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 SeptemberJune 30, 20212022
OR
☐ | 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. 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 |
| X |
| No |
|
|
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted 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 such files).
Yes |
| X |
| No |
|
|
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 | ☐ |
| 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 |
|
|
| No |
| X |
As of OctoberJuly 31, 2021,2022, there were 151,917,177150,768,739 shares of the registrant’s common stock outstanding.
BlackRock, Inc.
Index to Form 10-Q
PART I
FINANCIAL INFORMATION
|
| Page |
|
|
|
Item 1. |
| |
|
|
|
| 1 | |
|
|
|
| 2 | |
|
|
|
| 3 | |
|
|
|
| 4 | |
|
|
|
| 6 | |
|
|
|
| 7 | |
|
|
|
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|
|
|
|
Item 3. |
| |
|
|
|
Item 4. |
|
PART II
OTHER INFORMATION
Item 1. |
| |
|
|
|
Item 1A. |
| |
|
|
|
Item 2. |
| |
|
|
|
Item 6. |
| |
|
|
|
i
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
BlackRock, Inc.
Condensed Consolidated Statements of Financial Condition
(unaudited)
|
| September 30, |
|
| December 31, |
|
| June 30, |
|
| December 31, |
| ||||
(in millions, except shares and per share data) |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents(1) |
| $ | 7,361 |
|
| $ | 8,664 |
| ||||||||
Cash and cash equivalents(1) |
| $ | 6,481 |
|
| $ | 9,323 |
| ||||||||
Accounts receivable |
|
| 4,015 |
|
|
| 3,535 |
|
|
| 3,471 |
|
|
| 3,789 |
|
Investments(1) |
|
| 7,101 |
|
|
| 6,919 |
| ||||||||
Investments(1) |
|
| 7,302 |
|
|
| 7,262 |
| ||||||||
Separate account assets |
|
| 96,755 |
|
|
| 104,663 |
|
|
| 61,269 |
|
|
| 86,226 |
|
Separate account collateral held under securities lending agreements |
|
| 14,106 |
|
|
| 16,507 |
|
|
| 7,279 |
|
|
| 7,081 |
|
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 |
| ||||||||
Property and equipment (net of accumulated depreciation and amortization of $1,344 and $1,256 at June 30, 2022 and December 31, 2021, respectively) |
|
| 900 |
|
|
| 762 |
| ||||||||
Intangible assets (net of accumulated amortization of $447 and $399 at June 30, 2022 and December 31, 2021, respectively) |
|
| 18,377 |
|
|
| 18,453 |
| ||||||||
Goodwill |
|
| 15,360 |
|
|
| 14,551 |
|
|
| 15,346 |
|
|
| 15,351 |
|
Operating lease right-of-use assets |
|
| 1,798 |
|
|
| 649 |
|
|
| 1,543 |
|
|
| 1,621 |
|
Other assets(1) |
|
| 3,961 |
|
|
| 2,550 |
| ||||||||
Other assets(1) |
|
| 3,998 |
|
|
| 2,780 |
| ||||||||
Total assets |
| $ | 169,636 |
|
| $ | 176,982 |
|
| $ | 125,966 |
|
| $ | 152,648 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued compensation and benefits |
| $ | 2,343 |
|
| $ | 2,499 |
|
| $ | 1,408 |
|
| $ | 2,951 |
|
Accounts payable and accrued liabilities |
|
| 1,402 |
|
|
| 1,028 |
|
|
| 1,324 |
|
|
| 1,397 |
|
Borrowings |
|
| 6,474 |
|
|
| 7,264 |
|
|
| 6,635 |
|
|
| 7,446 |
|
Separate account liabilities |
|
| 96,755 |
|
|
| 104,663 |
|
|
| 61,269 |
|
|
| 86,226 |
|
Separate account collateral liabilities under securities lending agreements |
|
| 14,106 |
|
|
| 16,507 |
|
|
| 7,279 |
|
|
| 7,081 |
|
Deferred income tax liabilities |
|
| 3,659 |
|
|
| 3,673 |
|
|
| 2,801 |
|
|
| 2,758 |
|
Operating lease liabilities |
|
| 1,946 |
|
|
| 755 |
|
|
| 1,815 |
|
|
| 1,872 |
|
Other liabilities(1) |
|
| 4,585 |
|
|
| 2,937 |
| ||||||||
Other liabilities(1) |
|
| 5,130 |
|
|
| 4,024 |
| ||||||||
Total liabilities |
|
| 131,270 |
|
|
| 139,326 |
|
|
| 87,661 |
|
|
| 113,755 |
|
Commitments and contingencies (Note 15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable noncontrolling interests |
|
| 1,437 |
|
|
| 2,322 |
|
|
| 1,103 |
|
|
| 1,087 |
|
Permanent Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BlackRock, Inc. stockholders’ equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, $0.01 par value; |
|
| 2 |
|
|
| 2 |
|
|
| 2 |
|
|
| 2 |
|
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 |
|
|
|
|
|
|
|
| ||||||||
Shares authorized: 500,000,000 at June 30, 2022 and December 31, 2021; Shares issued: 172,075,373 at June 30, 2022 and December 31, 2021; Shares outstanding: 150,966,457 and 151,684,491 at June 30, 2022 and December 31, 2021, respectively |
|
|
|
|
|
|
|
| ||||||||
Additional paid-in capital |
|
| 19,462 |
|
|
| 19,293 |
|
|
| 19,469 |
|
|
| 19,640 |
|
Retained earnings |
|
| 26,672 |
|
|
| 24,334 |
|
|
| 28,678 |
|
|
| 27,688 |
|
Accumulated other comprehensive loss |
|
| (526 | ) |
|
| (337 | ) |
|
| (1,091 | ) |
|
| (550 | ) |
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 | ) | ||||||||
Treasury stock, common, at cost (21,108,916 and 20,390,882 shares held at June 30, 2022 and December 31, 2021, respectively) |
|
| (9,969 | ) |
|
| (9,087 | ) | ||||||||
Total BlackRock, Inc. stockholders’ equity |
|
| 36,817 |
|
|
| 35,283 |
|
|
| 37,089 |
|
|
| 37,693 |
|
Nonredeemable noncontrolling interests |
|
| 112 |
|
|
| 51 |
|
|
| 113 |
|
|
| 113 |
|
Total permanent equity |
|
| 36,929 |
|
|
| 35,334 |
|
|
| 37,202 |
|
|
| 37,806 |
|
Total liabilities, temporary equity and permanent equity |
| $ | 169,636 |
|
| $ | 176,982 |
|
| $ | 125,966 |
|
| $ | 152,648 |
|
(1) | At |
See accompanying notes to condensed consolidated financial statements.
BlackRock, Inc.
Condensed Consolidated Statements of Income
(unaudited)
|
| Three Months Ended |
|
| Nine Months Ended |
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
|
| September 30, |
|
| September 30, |
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions, except shares and per share data) |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment advisory, administration fees and securities lending revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Related parties |
| $ | 2,964 |
|
| $ | 2,329 |
|
| $ | 8,478 |
|
| $ | 6,556 |
|
| $ | 2,769 |
|
| $ | 2,829 |
|
| $ | 5,652 |
|
| $ | 5,514 |
|
Other third parties |
|
| 979 |
|
|
| 896 |
|
|
| 2,814 |
|
|
| 2,690 |
|
|
| 919 |
|
|
| 928 |
|
|
| 1,869 |
|
|
| 1,835 |
|
Total investment advisory, administration fees and securities lending revenue |
|
| 3,943 |
|
|
| 3,225 |
|
|
| 11,292 |
|
|
| 9,246 |
|
|
| 3,688 |
|
|
| 3,757 |
|
|
| 7,521 |
|
|
| 7,349 |
|
Investment advisory performance fees |
|
| 345 |
|
|
| 532 |
|
|
| 814 |
|
|
| 685 |
|
|
| 106 |
|
|
| 340 |
|
|
| 204 |
|
|
| 469 |
|
Technology services revenue |
|
| 320 |
|
|
| 282 |
|
|
| 942 |
|
|
| 834 |
|
|
| 332 |
|
|
| 316 |
|
|
| 673 |
|
|
| 622 |
|
Distribution fees |
|
| 401 |
|
|
| 288 |
|
|
| 1,110 |
|
|
| 817 |
|
|
| 361 |
|
|
| 369 |
|
|
| 742 |
|
|
| 709 |
|
Advisory and other revenue |
|
| 41 |
|
|
| 42 |
|
|
| 110 |
|
|
| 145 |
|
|
| 39 |
|
|
| 38 |
|
|
| 85 |
|
|
| 69 |
|
Total revenue |
|
| 5,050 |
|
|
| 4,369 |
|
|
| 14,268 |
|
|
| 11,727 |
|
|
| 4,526 |
|
|
| 4,820 |
|
|
| 9,225 |
|
|
| 9,218 |
|
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and benefits |
|
| 1,527 |
|
|
| 1,411 |
|
|
| 4,484 |
|
|
| 3,700 |
|
|
| 1,414 |
|
|
| 1,548 |
|
|
| 2,912 |
|
|
| 2,957 |
|
Distribution and servicing costs |
|
| 585 |
|
|
| 456 |
|
|
| 1,613 |
|
|
| 1,330 |
|
|
| 572 |
|
|
| 523 |
|
|
| 1,146 |
|
|
| 1,028 |
|
Direct fund expense |
|
| 354 |
|
|
| 257 |
|
|
| 994 |
|
|
| 780 |
|
|
| 304 |
|
|
| 320 |
|
|
| 633 |
|
|
| 640 |
|
General and administration expense |
|
| 611 |
|
|
| 461 |
|
|
| 1,657 |
|
|
| 1,991 |
|
|
| 530 |
|
|
| 461 |
|
|
| 1,026 |
|
|
| 1,046 |
|
Amortization of intangible assets |
|
| 38 |
|
|
| 27 |
|
|
| 109 |
|
|
| 79 |
|
|
| 38 |
|
|
| 37 |
|
|
| 76 |
|
|
| 71 |
|
Total expense |
|
| 3,115 |
|
|
| 2,612 |
|
|
| 8,857 |
|
|
| 7,880 |
|
|
| 2,858 |
|
|
| 2,889 |
|
|
| 5,793 |
|
|
| 5,742 |
|
Operating income |
|
| 1,935 |
|
|
| 1,757 |
|
|
| 5,411 |
|
|
| 3,847 |
|
|
| 1,668 |
|
|
| 1,931 |
|
|
| 3,432 |
|
|
| 3,476 |
|
Nonoperating income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain (loss) on investments |
|
| 370 |
|
|
| 269 |
|
|
| 766 |
|
|
| 627 |
|
|
| (314 | ) |
|
| 314 |
|
|
| (416 | ) |
|
| 396 |
|
Interest and dividend income |
|
| 14 |
|
|
| 9 |
|
|
| 41 |
|
|
| 34 |
|
|
| 21 |
|
|
| 8 |
|
|
| 39 |
|
|
| 27 |
|
Interest expense |
|
| (48 | ) |
|
| (54 | ) |
|
| (155 | ) |
|
| (151 | ) |
|
| (54 | ) |
|
| (52 | ) |
|
| (108 | ) |
|
| (107 | ) |
Total nonoperating income (expense) |
|
| 336 |
|
|
| 224 |
|
|
| 652 |
|
|
| 510 |
|
|
| (347 | ) |
|
| 270 |
|
|
| (485 | ) |
|
| 316 |
|
Income before income taxes |
|
| 2,271 |
|
|
| 1,981 |
|
|
| 6,063 |
|
|
| 4,357 |
|
|
| 1,321 |
|
|
| 2,201 |
|
|
| 2,947 |
|
|
| 3,792 |
|
Income tax expense |
|
| 518 |
|
|
| 464 |
|
|
| 1,490 |
|
|
| 811 |
|
|
| 358 |
|
|
| 654 |
|
|
| 621 |
|
|
| 972 |
|
Net income |
|
| 1,753 |
|
|
| 1,517 |
|
|
| 4,573 |
|
|
| 3,546 |
|
|
| 963 |
|
|
| 1,547 |
|
|
| 2,326 |
|
|
| 2,820 |
|
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to noncontrolling interests |
|
| 72 |
|
|
| 153 |
|
|
| 315 |
|
|
| 162 |
|
|
| (114 | ) |
|
| 169 |
|
|
| (187 | ) |
|
| 243 |
|
Net income attributable to BlackRock, Inc. |
| $ | 1,681 |
|
| $ | 1,364 |
|
| $ | 4,258 |
|
| $ | 3,384 |
|
| $ | 1,077 |
|
| $ | 1,378 |
|
| $ | 2,513 |
|
| $ | 2,577 |
|
Earnings per share attributable to BlackRock, Inc. common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
| $ | 11.05 |
|
| $ | 8.94 |
|
| $ | 27.94 |
|
| $ | 22.00 |
|
| $ | 7.12 |
|
| $ | 9.04 |
|
| $ | 16.59 |
|
| $ | 16.90 |
|
Diluted |
| $ | 10.89 |
|
| $ | 8.87 |
|
| $ | 27.59 |
|
| $ | 21.84 |
|
| $ | 7.06 |
|
| $ | 8.92 |
|
| $ | 16.43 |
|
| $ | 16.69 |
|
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
| 152,120,927 |
|
|
| 152,488,073 |
|
|
| 152,375,504 |
|
|
| 153,816,544 |
|
|
| 151,292,580 |
|
|
| 152,443,039 |
|
|
| 151,511,496 |
|
|
| 152,504,902 |
|
Diluted |
|
| 154,343,277 |
|
|
| 153,742,264 |
|
|
| 154,352,590 |
|
|
| 154,959,812 |
|
|
| 152,452,320 |
|
|
| 154,417,581 |
|
|
| 152,990,147 |
|
|
| 154,359,353 |
|
See accompanying notes to condensed consolidated financial statements.
BlackRock, Inc.
Condensed Consolidated Statements of Comprehensive Income
(unaudited)
|
| Three Months Ended |
|
| Nine Months Ended |
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
|
| September 30, |
|
| September 30, |
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Net income |
| $ | 1,753 |
|
| $ | 1,517 |
|
| $ | 4,573 |
|
| $ | 3,546 |
|
| $ | 963 |
|
| $ | 1,547 |
|
| $ | 2,326 |
|
| $ | 2,820 |
|
Other comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments(1) |
|
| (138 | ) |
|
| 180 |
|
|
| (189 | ) |
|
| (30 | ) | ||||||||||||||||
Foreign currency translation adjustments(1) |
|
| (416 | ) |
|
| 23 |
|
|
| (541 | ) |
|
| (51 | ) | ||||||||||||||||
Comprehensive income (loss) |
|
| 1,615 |
|
|
| 1,697 |
|
|
| 4,384 |
|
|
| 3,516 |
|
|
| 547 |
|
|
| 1,570 |
|
|
| 1,785 |
|
|
| 2,769 |
|
Less: Comprehensive income (loss) attributable to noncontrolling interests |
|
| 72 |
|
|
| 153 |
|
|
| 315 |
|
|
| 162 |
|
|
| (114 | ) |
|
| 169 |
|
|
| (187 | ) |
|
| 243 |
|
Comprehensive income attributable to BlackRock, Inc. |
| $ | 1,543 |
|
| $ | 1,544 |
|
| $ | 4,069 |
|
| $ | 3,354 |
|
| $ | 661 |
|
| $ | 1,401 |
|
| $ | 1,972 |
|
| $ | 2,526 |
|
(1) | Amounts for the three months ended |
See accompanying notes to condensed consolidated financial statements.
BlackRock, Inc.
Condensed Consolidated Statements of Changes in Equity
(unaudited)
For the NineSix Months Ended SeptemberJune 30, 20212022
(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) |
| 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, 2020 | $ | 19,295 |
|
| $ | 24,334 |
|
| $ | (337 | ) |
| $ | (8,009 | ) |
| $ | 35,283 |
|
| $ | 51 |
|
| $ | 35,334 |
|
| $ | 2,322 |
| ||||||||||||||||||||||||||||||||||||
December 31, 2021 | $ | 19,642 |
|
| $ | 27,688 |
|
| $ | (550 | ) |
| $ | (9,087 | ) |
| $ | 37,693 |
|
| $ | 113 |
|
| $ | 37,806 |
|
| $ | 1,087 |
| ||||||||||||||||||||||||||||||||||||
Net income |
| — |
|
|
| 4,258 |
|
|
| — |
|
|
| — |
|
|
| 4,258 |
|
|
| (4 | ) |
|
| 4,254 |
|
|
| 319 |
|
| — |
|
|
| 2,513 |
|
|
| — |
|
|
| — |
|
|
| 2,513 |
|
|
| (2 | ) |
|
| 2,511 |
|
|
| (185 | ) | |||||
Dividends declared ($12.39 per share) |
| — |
|
|
| (1,920 | ) |
|
| — |
|
|
| — |
|
|
| (1,920 | ) |
|
| — |
|
|
| (1,920 | ) |
|
| — |
| ||||||||||||||||||||||||||||||||||||
Dividends declared ($9.76 per share) |
| — |
|
|
| (1,523 | ) |
|
| — |
|
|
| — |
|
|
| (1,523 | ) |
|
| — |
|
|
| (1,523 | ) |
|
| — |
| ||||||||||||||||||||||||||||||||||||
Stock-based compensation |
| 551 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 551 |
|
|
| — |
|
|
| 551 |
|
|
| — |
|
| 376 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 376 |
|
|
| — |
|
|
| 376 |
|
|
| — |
| |||||
Issuance of common shares related to employee stock transactions |
| (382 | ) |
|
| — |
|
|
| — |
|
|
| 398 |
|
|
| 16 |
|
|
| — |
|
|
| 16 |
|
|
| — |
|
| (547 | ) |
|
| — |
|
|
| — |
|
|
| 561 |
|
|
| 14 |
|
|
| — |
|
|
| 14 |
|
|
| — |
| |||||
Employee tax withholdings related to employee stock transactions |
| — |
|
|
| — |
|
|
| — |
|
|
| (282 | ) |
|
| (282 | ) |
|
| — |
|
|
| (282 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (443 | ) |
|
| (443 | ) |
|
| — |
|
|
| (443 | ) |
|
| — |
| |||||
Shares repurchased |
| — |
|
|
| — |
|
|
| — |
|
|
| (900 | ) |
|
| (900 | ) |
|
| — |
|
|
| (900 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1,000 | ) |
|
| (1,000 | ) |
|
| — |
|
|
| (1,000 | ) |
|
| — |
| |||||
Contributions (redemptions/distributions) — noncontrolling interest holders |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 68 |
|
|
| 68 |
|
|
| 1,058 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 2 |
|
|
| 2 |
|
|
| 425 |
| |||||
Net consolidations (deconsolidations) of sponsored investment funds |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (3 | ) |
|
| (3 | ) |
|
| (2,262 | ) |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (224 | ) | |||||
Other comprehensive income (loss) |
| — |
|
|
| — |
|
|
| (189 | ) |
|
| — |
|
|
| (189 | ) |
|
| — |
|
|
| (189 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| (541 | ) |
|
| — |
|
|
| (541 | ) |
|
| — |
|
|
| (541 | ) |
|
| — |
| |||||
September 30, 2021 | $ | 19,464 |
|
| $ | 26,672 |
|
| $ | (526 | ) |
| $ | (8,793 | ) |
| $ | 36,817 |
|
| $ | 112 |
|
| $ | 36,929 |
|
| $ | 1,437 |
| ||||||||||||||||||||||||||||||||||||
June 30, 2022 | $ | 19,471 |
|
| $ | 28,678 |
|
| $ | (1,091 | ) |
| $ | (9,969 | ) |
| $ | 37,089 |
|
| $ | 113 |
|
| $ | 37,202 |
|
| $ | 1,103 |
|
(1) | Amounts include $2 million of common stock at both |
|
|
For the Three Months Ended SeptemberJune 30, 20212022
(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) |
| 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, 2021 | $ | 19,299 |
|
| $ | 25,620 |
|
| $ | (388 | ) |
| $ | (8,498 | ) |
| $ | 36,033 |
|
| $ | 115 |
|
| $ | 36,148 |
|
| $ | 2,242 |
| |||||||||||||||||||||||||||||||
March 31, 2022 | $ | 19,304 |
|
| $ | 28,338 |
|
| $ | (675 | ) |
| $ | (9,478 | ) |
| $ | 37,489 |
|
| $ | 107 |
|
| $ | 37,596 |
|
| $ | 1,263 |
| |||||||||||||||||||||||||||||||
Net income |
| — |
|
|
| 1,681 |
|
|
| — |
|
|
| — |
|
|
| 1,681 |
|
|
| (6 | ) |
|
| 1,675 |
|
|
| 78 |
|
| — |
|
|
| 1,077 |
|
|
| — |
|
|
| — |
|
|
| 1,077 |
|
|
| (2 | ) |
|
| 1,075 |
|
|
| (112 | ) |
Dividends declared ($4.13 per share) |
| — |
|
|
| (629 | ) |
|
| — |
|
|
| — |
|
|
| (629 | ) |
|
| — |
|
|
| (629 | ) |
|
| — |
| |||||||||||||||||||||||||||||||
Dividends declared ($4.88 per share) |
| — |
|
|
| (737 | ) |
|
| — |
|
|
| — |
|
|
| (737 | ) |
|
| — |
|
|
| (737 | ) |
|
| — |
| |||||||||||||||||||||||||||||||
Stock-based compensation |
| 173 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 173 |
|
|
| — |
|
|
| 173 |
|
|
| — |
|
| 175 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 175 |
|
|
| — |
|
|
| 175 |
|
|
| — |
|
Issuance of common shares related to employee stock transactions |
| (8 | ) |
|
| — |
|
|
| — |
|
|
| 14 |
|
|
| 6 |
|
|
| — |
|
|
| 6 |
|
|
| — |
|
| (8 | ) |
|
| — |
|
|
| — |
|
|
| 16 |
|
|
| 8 |
|
|
| — |
|
|
| 8 |
|
|
| — |
|
Employee tax withholdings related to employee stock transactions |
| — |
|
|
| — |
|
|
| — |
|
|
| (9 | ) |
|
| (9 | ) |
|
| — |
|
|
| (9 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (7 | ) |
|
| (7 | ) |
|
| — |
|
|
| (7 | ) |
|
| — |
|
Shares repurchased |
| — |
|
|
| — |
|
|
| — |
|
|
| (300 | ) |
|
| (300 | ) |
|
| — |
|
|
| (300 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (500 | ) |
|
| (500 | ) |
|
| — |
|
|
| (500 | ) |
|
| — |
|
Contributions (redemptions/distributions) — noncontrolling interest holders |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7 |
|
|
| 7 |
|
|
| 282 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 8 |
|
|
| 8 |
|
|
| 53 |
|
Net consolidations (deconsolidations) of sponsored investment funds |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4 | ) |
|
| (4 | ) |
|
| (1,165 | ) |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (101 | ) |
Other comprehensive income (loss) |
| — |
|
|
| — |
|
|
| (138 | ) |
|
| — |
|
|
| (138 | ) |
|
| — |
|
|
| (138 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| (416 | ) |
|
| — |
|
|
| (416 | ) |
|
| — |
|
|
| (416 | ) |
|
| — |
|
September 30, 2021 | $ | 19,464 |
|
| $ | 26,672 |
|
| $ | (526 | ) |
| $ | (8,793 | ) |
| $ | 36,817 |
|
| $ | 112 |
|
| $ | 36,929 |
|
| $ | 1,437 |
| |||||||||||||||||||||||||||||||
June 30, 2022 | $ | 19,471 |
|
| $ | 28,678 |
|
| $ | (1,091 | ) |
| $ | (9,969 | ) |
| $ | 37,089 |
|
| $ | 113 |
|
| $ | 37,202 |
|
| $ | 1,103 |
|
(1) | Amounts include $2 million of common stock at both |
|
|
See accompanying notes to condensed consolidated financial statements.
BlackRock, Inc.
Condensed Consolidated Statements of Changes in Equity
(unaudited)
For the NineSix Months Ended SeptemberJune 30, 20202021
(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 |
| 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 |
| ||||||||||||||||||||||||||||||||||||||||||||
December 31, 2020 | $ | 19,295 |
|
| $ | 24,334 |
|
| $ | (337 | ) |
| $ | (8,009 | ) |
| $ | 35,283 |
|
| $ | 51 |
|
| $ | 35,334 |
|
| $ | 2,322 |
| ||||||||||||||||||||||||||||||||||||||||||||
Net income |
| — |
|
|
| 3,384 |
|
|
| — |
|
|
| — |
|
|
| 3,384 |
|
|
| (2 | ) |
|
| 3,382 |
|
|
| 164 |
|
| — |
|
|
| 2,577 |
|
|
| — |
|
|
| — |
|
|
| 2,577 |
|
|
| 2 |
|
|
| 2,579 |
|
|
| 241 |
| |||||||||||||
Dividends declared ($10.89 per share) |
| — |
|
|
| (1,706 | ) |
|
| — |
|
|
| — |
|
|
| (1,706 | ) |
|
| — |
|
|
| (1,706 | ) |
|
| — |
| ||||||||||||||||||||||||||||||||||||||||||||
Dividends declared ($8.26 per share) |
| — |
|
|
| (1,291 | ) |
|
| — |
|
|
| — |
|
|
| (1,291 | ) |
|
| — |
|
|
| (1,291 | ) |
|
| — |
| ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation |
| 458 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 458 |
|
|
| — |
|
|
| 458 |
|
|
| — |
|
| 378 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 378 |
|
|
| — |
|
|
| 378 |
|
|
| — |
| |||||||||||||
Issuance of common shares related to employee stock transactions |
| (494 | ) |
|
| — |
|
|
| — |
|
|
| 506 |
|
|
| 12 |
|
|
| — |
|
|
| 12 |
|
|
| — |
|
| (374 | ) |
|
| — |
|
|
| — |
|
|
| 384 |
|
|
| 10 |
|
|
| — |
|
|
| 10 |
|
|
| — |
| |||||||||||||
Employee tax withholdings related to employee stock transactions |
| — |
|
|
| — |
|
|
| — |
|
|
| (280 | ) |
|
| (280 | ) |
|
| — |
|
|
| (280 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (273 | ) |
|
| (273 | ) |
|
| — |
|
|
| (273 | ) |
|
| — |
| |||||||||||||
Shares repurchased |
| — |
|
|
| — |
|
|
| — |
|
|
| (1,512 | ) |
|
| (1,512 | ) |
|
| — |
|
|
| (1,512 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (600 | ) |
|
| (600 | ) |
|
| — |
|
|
| (600 | ) |
|
| — |
| |||||||||||||
Contributions (redemptions/distributions) — noncontrolling interest holders |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5 | ) |
|
| (5 | ) |
|
| 1,363 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 61 |
|
|
| 61 |
|
|
| 776 |
| |||||||||||||
Net consolidations (deconsolidations) of sponsored investment funds |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (759 | ) |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1 |
|
|
| 1 |
|
|
| (1,097 | ) | |||||||||||||
Other comprehensive income (loss) |
| — |
|
|
| — |
|
|
| (30 | ) |
|
| — |
|
|
| (30 | ) |
|
| — |
|
|
| (30 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| (51 | ) |
|
| — |
|
|
| (51 | ) |
|
| — |
|
|
| (51 | ) |
|
| — |
| |||||||||||||
September 30, 2020 | $ | 19,152 |
|
| $ | 23,340 |
|
| $ | (601 | ) |
| $ | (8,018 | ) |
| $ | 33,873 |
|
| $ | 59 |
|
| $ | 33,932 |
|
| $ | 2,084 |
| ||||||||||||||||||||||||||||||||||||||||||||
June 30, 2021 | $ | 19,299 |
|
| $ | 25,620 |
|
| $ | (388 | ) |
| $ | (8,498 | ) |
| $ | 36,033 |
|
| $ | 115 |
|
| $ | 36,148 |
|
| $ | 2,242 |
|
(1) | Amounts include $2 million of common stock at both |
For the Three Months Ended SeptemberJune 30, 20202021
(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 |
| 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 |
| |||||||||||||||||||||||||||||||
March 31, 2021 | $ | 19,123 |
|
| $ | 24,872 |
|
| $ | (411 | ) |
| $ | (8,204 | ) |
| $ | 35,380 |
|
| $ | 49 |
|
| $ | 35,429 |
|
| $ | 2,411 |
| |||||||||||||||||||||||||||||||
Net income |
| — |
|
|
| 1,364 |
|
|
| — |
|
|
| — |
|
|
| 1,364 |
|
|
| (2 | ) |
|
| 1,362 |
|
|
| 155 |
|
| — |
|
|
| 1,378 |
|
|
| — |
|
|
| — |
|
|
| 1,378 |
|
|
| 2 |
|
|
| 1,380 |
|
|
| 167 |
|
Dividends declared ($3.63 per share) |
| — |
|
|
| (556 | ) |
|
| — |
|
|
| — |
|
|
| (556 | ) |
|
| — |
|
|
| (556 | ) |
|
| — |
| |||||||||||||||||||||||||||||||
Dividends declared ($4.13 per share) |
| — |
|
|
| (630 | ) |
|
| — |
|
|
| — |
|
|
| (630 | ) |
|
| — |
|
|
| (630 | ) |
|
| — |
| |||||||||||||||||||||||||||||||
Stock-based compensation |
| 160 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 160 |
|
|
| — |
|
|
| 160 |
|
|
| — |
|
| 182 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 182 |
|
|
| — |
|
|
| 182 |
|
|
| — |
|
Issuance of common shares related to employee stock transactions |
| (17 | ) |
|
| — |
|
|
| — |
|
|
| 22 |
|
|
| 5 |
|
|
| — |
|
|
| 5 |
|
|
| — |
|
| (6 | ) |
|
| — |
|
|
| — |
|
|
| 11 |
|
|
| 5 |
|
|
| — |
|
|
| 5 |
|
|
| — |
|
Employee tax withholdings related to employee stock transactions |
| — |
|
|
| — |
|
|
| — |
|
|
| (10 | ) |
|
| (10 | ) |
|
| — |
|
|
| (10 | ) |
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5 | ) |
|
| (5 | ) |
|
| — |
|
|
| (5 | ) |
|
| — |
|
Shares repurchased |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (300 | ) |
|
| (300 | ) |
|
| — |
|
|
| (300 | ) |
|
| — |
|
Contributions (redemptions/distributions) — noncontrolling interest holders |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 5 |
|
|
| 5 |
|
|
| 548 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 63 |
|
|
| 63 |
|
|
| 154 |
|
Net consolidations (deconsolidations) of sponsored investment funds |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 133 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1 |
|
|
| 1 |
|
|
| (490 | ) |
Other comprehensive income (loss) |
| — |
|
|
| — |
|
|
| 180 |
|
|
| — |
|
|
| 180 |
|
|
| — |
|
|
| 180 |
|
|
| — |
|
| — |
|
|
| — |
|
|
| 23 |
|
|
| — |
|
|
| 23 |
|
|
| — |
|
|
| 23 |
|
|
| — |
|
September 30, 2020 | $ | 19,152 |
|
| $ | 23,340 |
|
| $ | (601 | ) |
| $ | (8,018 | ) |
| $ | 33,873 |
|
| $ | 59 |
|
| $ | 33,932 |
|
| $ | 2,084 |
| |||||||||||||||||||||||||||||||
June 30, 2021 | $ | 19,299 |
|
| $ | 25,620 |
|
| $ | (388 | ) |
| $ | (8,498 | ) |
| $ | 36,033 |
|
| $ | 115 |
|
| $ | 36,148 |
|
| $ | 2,242 |
|
(1) | Amounts include $2 million of common stock at both |
See accompanying notes to condensed consolidated financial statements.
BlackRock, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
|
| Nine Months Ended |
|
| Six Months Ended |
| ||||||||||
(in millions) |
| September 30, |
|
| June 30, |
| ||||||||||
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
| $ | 4,573 |
|
| $ | 3,546 |
|
| $ | 2,326 |
|
| $ | 2,820 |
|
Adjustments to reconcile net income to net cash provided by/(used in) operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
| 305 |
|
|
| 255 |
|
|
| 199 |
|
|
| 198 |
|
Noncash lease expense |
|
| 101 |
|
|
| 87 |
|
|
| 82 |
|
|
| 63 |
|
Stock-based compensation |
|
| 551 |
|
|
| 458 |
|
|
| 376 |
|
|
| 378 |
|
Deferred income tax expense (benefit) |
|
| (5 | ) |
|
| 20 |
|
|
| 12 |
|
|
| 233 |
|
Charitable Contribution |
|
| — |
|
|
| 589 |
| ||||||||
Gain related to the Charitable Contribution |
|
| — |
|
|
| (122 | ) | ||||||||
Other investment gains |
|
| (153 | ) |
|
| (244 | ) | ||||||||
Net (gains) losses within CIPs |
|
| (350 | ) |
|
| (161 | ) |
|
| 388 |
|
|
| (310 | ) |
Net (purchases) proceeds within CIPs |
|
| (1,047 | ) |
|
| (1,603 | ) |
|
| (590 | ) |
|
| (759 | ) |
(Earnings) losses from equity method investees |
|
| (226 | ) |
|
| (75 | ) |
|
| 57 |
|
|
| (107 | ) |
Distributions of earnings from equity method investees |
|
| 54 |
|
|
| 25 |
|
|
| 32 |
|
|
| 25 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
| (527 | ) |
|
| (544 | ) |
|
| 216 |
|
|
| (264 | ) |
Investments, trading |
|
| 113 |
|
|
| 153 |
|
|
| 115 |
|
|
| 62 |
|
Other assets |
|
| (1,289 | ) |
|
| (864 | ) |
|
| (1,224 | ) |
|
| (1,330 | ) |
Accrued compensation and benefits |
|
| (180 | ) |
|
| (206 | ) |
|
| (1,582 | ) |
|
| (801 | ) |
Accounts payable and accrued liabilities |
|
| 354 |
|
|
| (183 | ) |
|
| (118 | ) |
|
| 205 |
|
Other liabilities |
|
| 753 |
|
|
| 633 |
|
|
| 934 |
|
|
| 840 |
|
Net cash provided by/(used in) operating activities |
|
| 3,027 |
|
|
| 1,764 |
|
|
| 1,223 |
|
|
| 1,253 |
|
Investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of investments |
|
| (579 | ) |
|
| (252 | ) |
|
| (383 | ) |
|
| (360 | ) |
Proceeds from sales and maturities of investments |
|
| 294 |
|
|
| 133 |
|
|
| 117 |
|
|
| 184 |
|
Distributions of capital from equity method investees |
|
| 77 |
|
|
| 124 |
|
|
| 34 |
|
|
| 55 |
|
Net consolidations (deconsolidations) of sponsored investment funds |
|
| (59 | ) |
|
| (42 | ) |
|
| (5 | ) |
|
| (39 | ) |
Acquisitions, net of cash acquired |
|
| (1,097 | ) |
|
| — |
|
|
| — |
|
|
| (1,097 | ) |
Purchases of property and equipment |
|
| (215 | ) |
|
| (140 | ) |
|
| (263 | ) |
|
| (178 | ) |
Net cash provided by/(used in) investing activities |
|
| (1,579 | ) |
|
| (177 | ) |
|
| (500 | ) |
|
| (1,435 | ) |
Financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings |
|
| — |
|
|
| 2,245 |
| ||||||||
Repayments of long-term borrowings |
|
| (750 | ) |
|
| — |
|
|
| (750 | ) |
|
| (750 | ) |
Cash dividends paid |
|
| (1,920 | ) |
|
| (1,706 | ) |
|
| (1,523 | ) |
|
| (1,291 | ) |
Repurchases of common stock |
|
| (1,182 | ) |
|
| (1,792 | ) |
|
| (1,443 | ) |
|
| (873 | ) |
Net proceeds from (repayments of) borrowings by CIPs |
|
| 32 |
|
|
| 38 |
| ||||||||
Net contributions (redemptions/distributions) - noncontrolling interest holders |
|
| 1,126 |
|
|
| 1,358 |
|
|
| 427 |
|
|
| 837 |
|
Other financing activities |
|
| (1 | ) |
|
| (37 | ) |
|
| 17 |
|
|
| 11 |
|
Net cash provided by/(used in) financing activities |
|
| (2,695 | ) |
|
| 106 |
|
|
| (3,272 | ) |
|
| (2,066 | ) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
| (56 | ) |
|
| (15 | ) |
|
| (293 | ) |
|
| — |
|
Net increase/(decrease) in cash, cash equivalents and restricted cash |
|
| (1,303 | ) |
|
| 1,678 |
|
|
| (2,842 | ) |
|
| (2,248 | ) |
Cash, cash equivalents and restricted cash, beginning of period |
|
| 8,681 |
|
|
| 4,846 |
|
|
| 9,340 |
|
|
| 8,681 |
|
Cash, cash equivalents and restricted cash, end of period |
| $ | 7,378 |
|
| $ | 6,524 |
|
| $ | 6,498 |
|
| $ | 6,433 |
|
Supplemental schedule of noncash investing and financing transactions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock |
| $ | 382 |
|
| $ | 494 |
|
| $ | 547 |
|
| $ | 374 |
|
Charitable Contribution of an investment |
| $ | — |
|
| $ | (589 | ) | ||||||||
Increase (decrease) in noncontrolling interests due to net consolidation (deconsolidation) of sponsored investment funds |
| $ | (2,265 | ) |
| $ | (759 | ) |
| $ | (224 | ) |
| $ | (1,096 | ) |
See accompanying notes to condensed consolidated financial statements.
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 technology services to institutional and retail clients worldwide.
BlackRock’s diverse platform of alpha-seeking active, index and 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® and BlackRock exchange-traded funds (“ETFs”), separate accounts, collective trust funds (“CTFs”) and other pooled investment vehicles. BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin®, Aladdin Wealth, eFront Cachematrix and FutureAdvisor,Cachematrix, as well as advisory services and solutions to a broad base of institutional and wealth management 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 represent the portion of CIPsconsolidated sponsored investment products (“CIPs”) and a consolidated affiliate (collectively, “consolidated entities”) in which the Company does not have direct equity ownership. Intercompany balances and transactions have been 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 notesfootnotes related thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020,2021, which was filed with the Securities and Exchange Commission on February 25, 2022 (“2021 (“2020 Form 10-K”).
The interim financial information at SeptemberJune 30, 20212022 and for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 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 prior period presentations and disclosures, while not required to be recast, were reclassified to ensure comparability with current period classifications.
Consolidated Affiliate. During the second quarter of 2021, the Company formed a majority-controlled asset management company in China - BlackRock 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 operating policies of the entity, based on the Company’s 50.1% ownership and 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 financial condition. NCI that are redeemable at the option of the holders are classified as temporary equity and nonredeemable NCI are classified as a component of permanent equity in the condensed consolidated statements of financial condition. In addition, the Company reports net income (loss) attributable to redeemable and nonredeemable NCI holders in net income (loss) attributable to NCI in the condensed consolidated statements of 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
Hierarchy of Fair Value 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 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 collateralized loan obligations (“CLOs”), bank loans, short-term floating-rate notes, asset-backed securities, securities held within consolidated hedge funds, |
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, investments in CLOs and bank loans held within consolidated CLOs. |
| • | 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.
A significant number of inputs used to value equity, debt securities, 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.
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 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.
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 mayCIPs 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 US dollars. The gain or loss from revaluing net investment hedges 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 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 receivesobtains either a) the legal title, toor b) a first ranking priority security interest, in the collateral. The minimum collateral with minimum values generally rangingrange 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.
TheIn situations where the Company obtains the legal title to collateral under these securities lending arrangements, the Company records an asset 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. Additionally, in situations where the Company obtains a first ranking priority security interest in the collateral, the Company does not have the ability to pledge or resell the collateral and therefore does not record the collateral on the condensed consolidated statements of financial condition. At June 30, 2022 and December 31, 2021, the fair value of loaned securities held by separate accounts was approximately $12.6 billion and $13.2 billion, respectively, and the fair value of the collateral under these securities lending agreements was approximately $13.5 billion and $14.1 billion, respectively, of which approximately $7.3 billion as of June 30, 2022 and $7.1 billion as of December 31, 2021 was recognized on the condensed consolidated statements of financial condition. During the six months ended June 30, 2022 and 2021, the Company had 0t resold or repledged any of the collateral obtained under these arrangements. 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, 2021 and 2020, the Company had 0t resold or repledged any of the collateral received under these arrangements. At September 30, 2021 and December 31, 2020, the fair value of loaned securities held by separate accounts was approximately $13 billion and $15.2 billion, respectively, and the fair value of the collateral held under these securities lending agreements was approximately $14.1 billion and $16.5 billion, respectively.income.
Money Market Fee Waivers. The Company may voluntarily waive 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 ninesix months ended SeptemberJune 30, 2021,2022, these waivers resulted in a reduction of management fees of approximately $130$0 million and $360$72 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 forDuring the three and ninesix months ended SeptemberJune 30, 2020.2021, these waivers resulted in a reduction of management fees of approximately $160 million and $230 million, respectively, which also was partially offset by a reduction of BlackRock’s distribution and servicing costs paid to financial intermediaries. The Company may increase or decrease the level of Yield Support waivers in future periods.
3. AcquisitionsAcquisition
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 assets acquired and liabilities assumed based upon their estimated fair values at the date of the transaction. The goodwill recognized in connection with the acquisition is primarily attributable to anticipated synergies from the transaction. The amount of goodwill expected to be deductible for tax purposes is approximately $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 |
|
|
|
|
|
|
|
|
|
|
Finite-lived intangible assets are amortized over their estimated useful lives, which range from three to 10 years. Amortization expense related to the finite-lived intangible assets was $10 million and $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 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 |
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
| Fair Value |
| |
Accounts receivable |
| $ | 16 |
|
Finite-lived intangible assets: |
|
|
|
|
Customer relationships |
|
| 270 |
|
Other |
|
| 17 |
|
Goodwill |
|
| 776 |
|
Deferred income tax liabilities |
|
| (16 | ) |
Other liabilities assumed |
|
| (12 | ) |
Total consideration, net of cash acquired |
| $ | 1,051 |
|
|
|
|
|
|
Summary of consideration, net of cash acquired: |
|
|
|
|
Cash paid |
| $ | 1,055 |
|
Cash acquired |
|
| (4 | ) |
Total consideration, net of cash acquired |
| $ | 1,051 |
|
|
|
|
|
|
The financial results of Aperio have been included in BlackRock’s condensed consolidated financial statements from the closing of the Aperio Transaction. For the three and nine months ended September 30, 2021, Aperio contributed $22 million and $56 million, respectively, of 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 statements.
4. Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash and cash equivalents reported within the condensed consolidated statements of financial condition to the cash, cash equivalents, and restricted cash reported within the condensed consolidated statements of cash flows.
|
| September 30, |
|
| December 31, |
|
| June 30, |
|
| December 31, |
| ||||
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
(in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
| $ | 7,361 |
|
| $ | 8,664 |
|
| $ | 6,481 |
|
| $ | 9,323 |
|
Restricted cash included in other assets |
|
| 17 |
|
|
| 17 |
|
|
| 17 |
|
|
| 17 |
|
Total cash, cash equivalents and restricted cash |
| $ | 7,378 |
|
| $ | 8,681 |
|
| $ | 6,498 |
|
| $ | 9,340 |
|
5. Investments
A summary of the carrying value of total investments is as follows:
| 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 |
|
| June 30, |
|
| December 31, |
| |||
(in millions) | 2022 |
|
| 2021 |
| |||
Debt securities: |
|
|
|
|
|
|
| |
Trading securities (including $1,014 and $1,140 trading debt securities of CIPs at June 30, 2022 and December 31, 2021, respectively) | $ | 1,057 |
|
| $ | 1,186 |
| |
Held-to-maturity investments |
| 491 |
|
|
| 430 |
| |
Total debt securities |
| 1,548 |
|
|
| 1,616 |
| |
Equity securities at FVTNI (including $1,441 and $1,485 equity securities at FVTNI of CIPs at June 30, 2022 and December 31, 2021, respectively) |
| 1,684 |
|
|
| 1,738 |
| |
Equity method investments(1) |
| 1,782 |
|
|
| 1,694 |
| |
Bank loans held by CIPs |
| 279 |
|
|
| 284 |
| |
Federal Reserve Bank stock(2) |
| 90 |
|
|
| 96 |
| |
Carried interest(3) |
| 1,644 |
|
|
| 1,555 |
| |
Other investments(4) |
| 275 |
|
|
| 279 |
| |
Total investments | $ | 7,302 |
|
| $ | 7,262 |
|
|
|
( | Equity method investments primarily include BlackRock’s direct investments in certain BlackRock sponsored investment funds. |
( |
|
( | Carried interest 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. |
( | 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 |
Held-to-Maturity Investments
The carrying value of held-to-maturity investments was $386 million and $310 million at September 30, 2021 and December 31, 2020, respectively. Held-to-maturity investments included certain investments in BlackRock sponsored CLOs and foreign government debt held primarily for regulatory purposes. The amortized cost (carrying value) of these investments approximated fair value (primarily a Level 2 input). At SeptemberJune 30, 2021, $362022, $25 million of these investments mature between one to five years, $96$129 million of these investments mature between five to 10ten years and $254$337 million of these investments mature after 10 years.
Trading Debt Securities and Equity Securities at FVTNI
A summary of the cost and carrying value of trading debt securities and equity securities at FVTNIfair value recorded through net income (“FVTNI”) is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
| September 30, 2021 |
|
| December 31, 2020 |
| June 30, 2022 |
|
| December 31, 2021 |
| ||||||||||||||||||||
(in millions) | Cost |
|
| Carrying Value |
|
| Cost |
|
| Carrying Value |
| Cost |
|
| Carrying Value |
|
| Cost |
|
| Carrying Value |
| ||||||||
Trading debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate debt | $ | 961 |
|
| $ | 970 |
|
| $ | 1,591 |
|
| $ | 1,641 |
| $ | 629 |
|
| $ | 620 |
|
| $ | 703 |
|
| $ | 701 |
|
Government debt |
| 403 |
|
|
| 403 |
|
|
| 203 |
|
|
| 210 |
|
| 331 |
|
|
| 331 |
|
|
| 365 |
|
|
| 363 |
|
Asset/mortgage-backed debt |
| 120 |
|
|
| 107 |
|
|
| 132 |
|
|
| 113 |
|
| 120 |
|
|
| 106 |
|
|
| 126 |
|
|
| 122 |
|
Total trading debt securities | $ | 1,484 |
|
| $ | 1,480 |
|
| $ | 1,926 |
|
| $ | 1,964 |
| $ | 1,080 |
|
| $ | 1,057 |
|
| $ | 1,194 |
|
| $ | 1,186 |
|
Equity securities at FVTNI: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities/mutual funds | $ | 1,311 |
|
| $ | 1,591 |
|
| $ | 2,055 |
|
| $ | 2,317 |
| $ | 1,600 |
|
| $ | 1,684 |
|
| $ | 1,451 |
|
| $ | 1,738 |
|
Total equity securities at FVTNI | $ | 1,311 |
|
| $ | 1,591 |
|
| $ | 2,055 |
|
| $ | 2,317 |
| $ | 1,600 |
|
| $ | 1,684 |
|
| $ | 1,451 |
|
| $ | 1,738 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6. Consolidated Sponsored Investment Products
The Company consolidates certain sponsored investment funds accounted for as VREsvoting rights entities (“VREs”) because it is deemed to control such funds.
In the normal course of business, the Company is the manager of various types of sponsored investment vehicles, which may be considered 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’s consolidated VIEs include certain sponsored investment 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 products and the right to receive benefits (or the obligation to absorb losses) that could potentially be significant to these sponsored investment 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.
The following table presents the balances related to these CIPs accounted for as VIEs and VREs that were recorded on the condensed consolidated statements of financial condition, including BlackRock’s net interest in these products:
|
| September 30, 2021 |
|
| December 31, 2020 |
|
| June 30, 2022 |
|
| December 31, 2021 |
| ||||||||||||||||||||||||||||||||||||
(in millions) |
| VIEs |
|
| VREs |
|
| Total |
|
| VIEs |
|
| VREs |
|
| Total |
|
| VIEs |
|
| VREs |
|
| Total |
|
| VIEs |
|
| VREs |
|
| Total |
| ||||||||||||
Cash and cash equivalents |
| $ | 204 |
|
| $ | 61 |
|
| $ | 265 |
|
| $ | 155 |
|
| $ | 51 |
|
| $ | 206 |
|
| $ | 274 |
|
| $ | 44 |
|
| $ | 318 |
|
| $ | 251 |
|
| $ | 57 |
|
| $ | 308 |
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading debt securities |
|
| 1,258 |
|
|
| 167 |
|
|
| 1,425 |
|
|
| 1,618 |
|
|
| 310 |
|
|
| 1,928 |
|
|
| 684 |
|
|
| 330 |
|
|
| 1,014 |
|
|
| 870 |
|
|
| 270 |
|
|
| 1,140 |
|
Equity securities at FVTNI |
|
| 946 |
|
|
| 308 |
|
|
| 1,254 |
|
|
| 1,592 |
|
|
| 413 |
|
|
| 2,005 |
|
|
| 1,097 |
|
|
| 344 |
|
|
| 1,441 |
|
|
| 1,100 |
|
|
| 385 |
|
|
| 1,485 |
|
Bank loans |
|
| 282 |
|
|
| — |
|
|
| 282 |
|
|
| 248 |
|
|
| — |
|
|
| 248 |
|
|
| 279 |
|
|
| — |
|
|
| 279 |
|
|
| 284 |
|
|
| — |
|
|
| 284 |
|
Other investments |
|
| 207 |
|
|
| — |
|
|
| 207 |
|
|
| 191 |
|
|
| — |
|
|
| 191 |
|
|
| 228 |
|
|
| — |
|
|
| 228 |
|
|
| 210 |
|
|
| — |
|
|
| 210 |
|
Carried interest |
|
| 1,406 |
|
|
| — |
|
|
| 1,406 |
|
|
| 604 |
|
|
| — |
|
|
| 604 |
|
|
| 1,592 |
|
|
| — |
|
|
| 1,592 |
|
|
| 1,504 |
|
|
| — |
|
|
| 1,504 |
|
Total investments |
|
| 4,099 |
|
|
| 475 |
|
|
| 4,574 |
|
|
| 4,253 |
|
|
| 723 |
|
|
| 4,976 |
|
|
| 3,880 |
|
|
| 674 |
|
|
| 4,554 |
|
|
| 3,968 |
|
|
| 655 |
|
|
| 4,623 |
|
Other assets |
|
| 83 |
|
|
| 10 |
|
|
| 93 |
|
|
| 90 |
|
|
| 9 |
|
|
| 99 |
|
|
| 62 |
|
|
| 24 |
|
|
| 86 |
|
|
| 50 |
|
|
| 32 |
|
|
| 82 |
|
Other liabilities(1) |
|
| (1,799 | ) |
|
| (39 | ) |
|
| (1,838 | ) |
|
| (952 | ) |
|
| (70 | ) |
|
| (1,022 | ) | ||||||||||||||||||||||||
Other liabilities(1) |
|
| (2,059 | ) |
|
| (40 | ) |
|
| (2,099 | ) |
|
| (1,919 | ) |
|
| (82 | ) |
|
| (2,001 | ) | ||||||||||||||||||||||||
Noncontrolling interests - CIPs |
|
| (1,416 | ) |
|
| (59 | ) |
|
| (1,475 | ) |
|
| (2,193 | ) |
|
| (180 | ) |
|
| (2,373 | ) |
|
| (1,060 | ) |
|
| (89 | ) |
|
| (1,149 | ) |
|
| (1,046 | ) |
|
| (79 | ) |
|
| (1,125 | ) |
BlackRock's net interests in CIPs |
| $ | 1,171 |
|
| $ | 448 |
|
| $ | 1,619 |
|
| $ | 1,353 |
|
| $ | 533 |
|
| $ | 1,886 |
|
| $ | 1,097 |
|
| $ | 613 |
|
| $ | 1,710 |
|
| $ | 1,304 |
|
| $ | 583 |
|
| $ | 1,887 |
|
(1) | At both |
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 CIPSCIPs 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 |
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
|
| September 30, |
|
| September 30, |
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonoperating net gain (loss) on consolidated VIEs |
| $ | 50 |
|
| $ | 213 |
|
| $ | 323 |
|
| $ | 186 |
|
| $ | (183 | ) |
| $ | 190 |
|
| $ | (316 | ) |
| $ | 273 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to NCI on consolidated VIEs |
| $ | 73 |
|
| $ | 149 |
|
| $ | 296 |
|
| $ | 169 |
|
| $ | (108 | ) |
| $ | 168 |
|
| $ | (183 | ) |
| $ | 223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7. Variable Interest Entities
Nonconsolidated VIEs. At SeptemberJune 30, 20212022 and December 31, 2020,2021, 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 primary beneficiary (“PB”), was as follows:
(in millions) |
|
|
|
| Advisory Fee |
|
| Other Net Assets |
|
| Maximum |
|
|
|
|
| Advisory Fee |
|
| Other Net Assets |
|
| Maximum |
| ||||||
At September 30, 2021 | Investments |
|
| Receivables |
|
| (Liabilities) |
|
| Risk of Loss(1) |
| |||||||||||||||||||
At June 30, 2022 | Investments |
|
| Receivables |
|
| (Liabilities) |
|
| Risk of Loss(1) |
| |||||||||||||||||||
Sponsored investment products | $ | 865 |
|
| $ | 71 |
|
| $ | (12 | ) |
| $ | 953 |
| $ | 976 |
|
| $ | 92 |
|
| $ | (12 | ) |
| $ | 1,084 |
|
At December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
At December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Sponsored investment products | $ | 662 |
|
| $ | 71 |
|
| $ | (13 | ) |
| $ | 750 |
| $ | 882 |
|
| $ | 62 |
|
| $ | (12 | ) |
| $ | 961 |
|
(1) | At both |
The net assets of sponsored investment products that are nonconsolidated VIEs approximated $23$20 billion and $16$20 billion at SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.
8. Fair Value Disclosures
Fair Value Hierarchy
Assets and liabilities measured at fair value on a recurring basis
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 |
|
|
|
|
|
|
|
|
|
|
|
Assets and liabilities measured at fair value on a recurring basis
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 |
| |||||||||||||||||||||||||||||
June 30, 2022 (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) |
|
| June 30, 2022 |
| |||||||||||||||||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held-to-maturity investments | $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 310 |
|
| $ | 310 |
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 491 |
|
| $ | 491 |
|
Trading securities |
| — |
|
|
| 1,953 |
|
|
| 11 |
|
|
| — |
|
|
| — |
|
|
| 1,964 |
|
| — |
|
|
| 1,041 |
|
|
| 16 |
|
|
| — |
|
|
| — |
|
|
| 1,057 |
|
Total debt securities |
| — |
|
|
| 1,953 |
|
|
| 11 |
|
|
| — |
|
|
| 310 |
|
|
| 2,274 |
|
| — |
|
|
| 1,041 |
|
|
| 16 |
|
|
| — |
|
|
| 491 |
|
|
| 1,548 |
|
Equity securities at FVTNI: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities/mutual funds |
| 2,317 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 2,317 |
|
| 1,684 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1,684 |
|
Equity method: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity and fixed income mutual funds |
| 235 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 235 |
|
| 238 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 238 |
|
Hedge funds/funds of hedge funds |
| — |
|
|
| — |
|
|
| — |
|
|
| 313 |
|
|
| — |
|
|
| 313 |
| |||||||||||||||||||||||
Hedge funds/funds of hedge funds/other |
| — |
|
|
| — |
|
|
| — |
|
|
| 428 |
|
|
| — |
|
|
| 428 |
| |||||||||||||||||||||||
Private equity funds |
| — |
|
|
| — |
|
|
| — |
|
|
| 315 |
|
|
| — |
|
|
| 315 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 853 |
|
|
| — |
|
|
| 853 |
|
Real assets funds |
| — |
|
|
| — |
|
|
| — |
|
|
| 218 |
|
|
| — |
|
|
| 218 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 263 |
|
|
| — |
|
|
| 263 |
|
Total equity method |
| 235 |
|
|
| — |
|
|
| — |
|
|
| 846 |
|
|
| — |
|
|
| 1,081 |
|
| 238 |
|
|
| — |
|
|
| — |
|
|
| 1,544 |
|
|
| — |
|
|
| 1,782 |
|
Bank loans |
| — |
|
|
| 16 |
|
|
| 232 |
|
|
| — |
|
|
| — |
|
|
| 248 |
|
| — |
|
|
| 27 |
|
|
| 252 |
|
|
| — |
|
|
| — |
|
|
| 279 |
|
Federal Reserve Bank Stock |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 94 |
|
|
| 94 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 90 |
|
|
| 90 |
|
Carried interest |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 627 |
|
|
| 627 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1,644 |
|
|
| 1,644 |
|
Other investments(3) |
| — |
|
|
| — |
|
|
| 9 |
|
|
| 94 |
|
|
| 175 |
|
|
| 278 |
|
| — |
|
|
| 1 |
|
|
| 4 |
|
|
| 111 |
|
|
| 159 |
|
|
| 275 |
|
Total investments |
| 2,552 |
|
|
| 1,969 |
|
|
| 252 |
|
|
| 940 |
|
|
| 1,206 |
|
|
| 6,919 |
|
| 1,922 |
|
|
| 1,069 |
|
|
| 272 |
|
|
| 1,655 |
|
|
| 2,384 |
|
|
| 7,302 |
|
Other assets(4) |
| 205 |
|
|
| 13 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 218 |
|
| 126 |
|
|
| 33 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 159 |
|
Separate account assets |
| 71,392 |
|
|
| 32,404 |
|
|
| — |
|
|
| — |
|
|
| 867 |
|
|
| 104,663 |
|
| 40,072 |
|
|
| 20,476 |
|
|
| — |
|
|
| — |
|
|
| 721 |
|
|
| 61,269 |
|
Separate account collateral held under securities lending agreements: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities |
| 13,126 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 13,126 |
|
| 2,686 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 2,686 |
|
Debt securities |
| — |
|
|
| 3,381 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 3,381 |
|
| — |
|
|
| 4,593 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 4,593 |
|
Total separate account collateral held under securities lending agreements |
| 13,126 |
|
|
| 3,381 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 16,507 |
|
| 2,686 |
|
|
| 4,593 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7,279 |
|
Total | $ | 87,275 |
|
| $ | 37,767 |
|
| $ | 252 |
|
| $ | 940 |
|
| $ | 2,073 |
|
| $ | 128,307 |
| $ | 44,806 |
|
| $ | 26,171 |
|
| $ | 272 |
|
| $ | 1,655 |
|
| $ | 3,105 |
|
| $ | 76,009 |
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Separate account collateral liabilities under securities lending agreements | $ | 13,126 |
|
| $ | 3,381 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 16,507 |
| $ | 2,686 |
|
| $ | 4,593 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 7,279 |
|
Other liabilities(5) |
| — |
|
|
| 68 |
|
|
| 272 |
|
|
| — |
|
|
| — |
|
|
| 340 |
|
| — |
|
|
| 36 |
|
|
| 314 |
|
|
| — |
|
|
| — |
|
|
| 350 |
|
Total | $ | 13,126 |
|
| $ | 3,449 |
|
| $ | 272 |
|
| $ | — |
|
| $ | — |
|
| $ | 16,847 |
| $ | 2,686 |
|
| $ | 4,629 |
|
| $ | 314 |
|
| $ | — |
|
| $ | — |
|
| $ | 7,629 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 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 |
(4) | Level 1 amount includes a minority investment in a publicly traded company. |
(5) | Level 2 amount primarily includes fair value of 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 15, Commitments and Contingencies, for more information). |
Assets and liabilities measured at fair value on a recurring basis
December 31, 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) |
|
| December 31, 2021 |
| ||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held-to-maturity investments | $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 430 |
|
| $ | 430 |
|
Trading securities |
| — |
|
|
| 1,169 |
|
|
| 17 |
|
|
| — |
|
|
| — |
|
|
| 1,186 |
|
Total debt securities |
| — |
|
|
| 1,169 |
|
|
| 17 |
|
|
| — |
|
|
| 430 |
|
|
| 1,616 |
|
Equity securities at FVTNI: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities/mutual funds |
| 1,738 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1,738 |
|
Equity method: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity and fixed income mutual funds |
| 245 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 245 |
|
Hedge funds/funds of hedge funds/other |
| — |
|
|
| — |
|
|
| — |
|
|
| 369 |
|
|
| — |
|
|
| 369 |
|
Private equity funds |
| — |
|
|
| — |
|
|
| — |
|
|
| 846 |
|
|
| — |
|
|
| 846 |
|
Real assets funds |
| — |
|
|
| — |
|
|
| — |
|
|
| 234 |
|
|
| — |
|
|
| 234 |
|
Total equity method |
| 245 |
|
|
| — |
|
|
| — |
|
|
| 1,449 |
|
|
| — |
|
|
| 1,694 |
|
Bank loans |
| — |
|
|
| 14 |
|
|
| 270 |
|
|
| — |
|
|
| — |
|
|
| 284 |
|
Federal Reserve Bank Stock |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 96 |
|
|
| 96 |
|
Carried interest |
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 1,555 |
|
|
| 1,555 |
|
Other investments(3) |
| — |
|
|
| — |
|
|
| 5 |
|
|
| 96 |
|
|
| 178 |
|
|
| 279 |
|
Total investments |
| 1,983 |
|
|
| 1,183 |
|
|
| 292 |
|
|
| 1,545 |
|
|
| 2,259 |
|
|
| 7,262 |
|
Other assets(4) |
| 195 |
|
|
| 39 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 234 |
|
Separate account assets |
| 54,675 |
|
|
| 30,786 |
|
|
| — |
|
|
| — |
|
|
| 765 |
|
|
| 86,226 |
|
Separate account collateral held under securities lending agreements: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities |
| 3,717 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 3,717 |
|
Debt securities |
| — |
|
|
| 3,364 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 3,364 |
|
Total separate account collateral held under securities lending agreements |
| 3,717 |
|
|
| 3,364 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7,081 |
|
Total | $ | 60,570 |
|
| $ | 35,372 |
|
| $ | 292 |
|
| $ | 1,545 |
|
| $ | 3,024 |
|
| $ | 100,803 |
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Separate account collateral liabilities under securities lending agreements | $ | 3,717 |
|
| $ | 3,364 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 7,081 |
|
Other liabilities(5) |
| — |
|
|
| 26 |
|
|
| 342 |
|
|
| — |
|
|
| — |
|
|
| 368 |
|
Total | $ | 3,717 |
|
| $ | 3,390 |
|
| $ | 342 |
|
| $ | — |
|
| $ | — |
|
| $ | 7,449 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 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 include direct investments in private equity companies held by consolidated private equity funds. |
(4) | Level 1 amount includes a minority investment in a publicly traded company. |
(5) | Level 2 amount primarily includes fair value of 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 15, Commitments and Contingencies, for more information). |
Level 3 Assets. 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 or income approach.
Level 3 investments of $308$272 million and $252$292 million at SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively, primarily included bank loans of a consolidated CLO.
Level 3 Liabilities. Level 3 liabilities primarily include 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 SeptemberJune 30, 20212022
(in millions) |
| 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) |
|
| March 31, 2022 |
|
| Realized and Unrealized Gains (Losses) |
|
| Purchases |
|
| Sales and Maturities |
|
| Issuances and other Settlements |
|
| Transfers into Level 3 |
|
| Transfers out of Level 3 |
|
| June 30, 2022 |
|
| Total Net Unrealized Gains (Losses) Included in Earnings(1) |
| ||||||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading |
| $ | 21 |
|
| $ | 2 |
|
| $ | 12 |
|
| $ | (5 | ) |
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 30 |
|
| $ | 2 |
|
| $ | 8 |
|
| $ | (3 | ) |
| $ | 13 |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | (1 | ) |
| $ | 16 |
|
| $ | (3 | ) |
Total debt securities |
|
| 21 |
|
|
| 2 |
|
|
| 12 |
|
|
| (5 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 30 |
|
|
| 2 |
|
|
| 8 |
|
|
| (3 | ) |
|
| 13 |
|
|
| (1 | ) |
|
| — |
|
|
| — |
|
|
| (1 | ) |
|
| 16 |
|
|
| (3 | ) |
Private equity |
|
| 5 |
|
|
| 1 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1 | ) |
|
| 5 |
|
|
| 1 |
|
|
| 4 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 4 |
|
|
| — |
|
Bank loans |
|
| 261 |
|
|
| — |
|
|
| 16 |
|
|
| — |
|
|
| — |
|
|
| 1 |
|
|
| (5 | ) |
|
| 273 |
|
|
| — |
|
|
| 264 |
|
|
| (3 | ) |
|
| 8 |
|
|
| (18 | ) |
|
| — |
|
|
| 4 |
|
|
| (3 | ) |
|
| 252 |
|
|
| (3 | ) |
Total investments |
| $ | 287 |
|
| $ | 3 |
|
| $ | 28 |
|
| $ | (5 | ) |
| $ | — |
|
| $ | 1 |
|
| $ | (6 | ) |
| $ | 308 |
|
| $ | 3 |
|
|
| 276 |
|
|
| (6 | ) |
|
| 21 |
|
|
| (19 | ) |
|
| — |
|
|
| 4 |
|
|
| (4 | ) |
|
| 272 |
|
|
| (6 | ) |
Total Level 3 assets |
| $ | 276 |
|
| $ | (6 | ) |
| $ | 21 |
|
| $ | (19 | ) |
| $ | — |
|
| $ | 4 |
|
| $ | (4 | ) |
| $ | 272 |
|
| $ | (6 | ) | ||||||||||||||||||||||||||||||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities |
| $ | 298 |
|
| $ | (28 | ) |
| $ | — |
|
| $ | — |
|
| $ | 14 |
|
| $ | — |
|
| $ | — |
|
| $ | 340 |
|
| $ | (28 | ) |
| $ | 312 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 2 |
|
| $ | — |
|
| $ | — |
|
| $ | 314 |
|
| $ | — |
|
Total Level 3 liabilities |
| $ | 298 |
|
| $ | (28 | ) |
| $ | — |
|
| $ | — |
|
| $ | 14 |
|
| $ | — |
|
| $ | — |
|
| $ | 340 |
|
| $ | (28 | ) |
| $ | 312 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 2 |
|
| $ | — |
|
| $ | — |
|
| $ | 314 |
|
| $ | — |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
| Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date. |
Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the NineSix Months Ended SeptemberJune 30, 20212022
(in millions) |
| 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) |
|
| December 31, 2021 |
|
| Realized and Unrealized Gains (Losses) |
|
| Purchases |
|
| Sales and Maturities |
|
| Issuances and other Settlements(1) |
|
| Transfers into Level 3 |
|
| Transfers out of Level 3 |
|
| June 30, 2022 |
|
| Total Net Unrealized Gains (Losses) Included in Earnings(2) |
| ||||||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading |
| $ | 11 |
|
| $ | 2 |
|
| $ | 24 |
|
| $ | (5 | ) |
| $ | — |
|
| $ | — |
|
| $ | (2 | ) |
| $ | 30 |
|
| $ | 2 |
|
| $ | 17 |
|
| $ | (3 | ) |
| $ | 19 |
|
| $ | (13 | ) |
| $ | — |
|
| $ | — |
|
| $ | (4 | ) |
| $ | 16 |
|
| $ | (3 | ) |
Total debt securities |
|
| 11 |
|
|
| 2 |
|
|
| 24 |
|
|
| (5 | ) |
|
| — |
|
|
| — |
|
|
| (2 | ) |
|
| 30 |
|
|
| 2 |
|
|
| 17 |
|
|
| (3 | ) |
|
| 19 |
|
|
| (13 | ) |
|
| — |
|
|
| — |
|
|
| (4 | ) |
|
| 16 |
|
|
| (3 | ) |
Private equity |
|
| 9 |
|
|
| 1 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5 | ) |
|
| 5 |
|
|
| 1 |
|
|
| 5 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1 | ) |
|
| 4 |
|
|
| — |
|
Bank loans |
|
| 232 |
|
|
| — |
|
|
| 45 |
|
|
| — |
|
|
| — |
|
|
| 11 |
|
|
| (15 | ) |
|
| 273 |
|
|
| — |
|
|
| 270 |
|
|
| (3 | ) |
|
| 16 |
|
|
| (18 | ) |
|
| — |
|
|
| 4 |
|
|
| (17 | ) |
|
| 252 |
|
|
| (3 | ) |
Total investments |
| $ | 252 |
|
| $ | 3 |
|
| $ | 69 |
|
| $ | (5 | ) |
| $ | — |
|
| $ | 11 |
|
| $ | (22 | ) |
| $ | 308 |
|
| $ | 3 |
|
|
| 292 |
|
|
| (6 | ) |
|
| 35 |
|
|
| (31 | ) |
|
| — |
|
|
| 4 |
|
|
| (22 | ) |
|
| 272 |
|
|
| (6 | ) |
Total Level 3 assets |
| $ | 292 |
|
| $ | (6 | ) |
| $ | 35 |
|
| $ | (31 | ) |
| $ | — |
|
| $ | 4 |
|
| $ | (22 | ) |
| $ | 272 |
|
| $ | (6 | ) | ||||||||||||||||||||||||||||||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities |
| $ | 272 |
|
| $ | (32 | ) |
| $ | — |
|
| $ | — |
|
| $ | 36 |
|
| $ | — |
|
| $ | — |
|
| $ | 340 |
|
| $ | (32 | ) |
| $ | 342 |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | (29 | ) |
| $ | — |
|
| $ | — |
|
| $ | 314 |
|
| $ | (1 | ) |
Total Level 3 liabilities |
| $ | 272 |
|
| $ | (32 | ) |
| $ | — |
|
| $ | — |
|
| $ | 36 |
|
| $ | — |
|
| $ | — |
|
| $ | 340 |
|
| $ | (32 | ) |
| $ | 342 |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | (29 | ) |
| $ | — |
|
| $ | — |
|
| $ | 314 |
|
| $ | (1 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Amounts include proceeds from borrowings of a consolidated CLO and |
(2) | Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities 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 SeptemberJune 30, 20202021
(in millions) |
| 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) |
|
| March 31, 2021 |
|
| Realized and Unrealized Gains (Losses) |
|
| Purchases |
|
| Sales and Maturities |
|
| Issuances and other Settlements(1) |
|
| Transfers into Level 3 |
|
| Transfers out of Level 3 |
|
| June 30, 2021 |
|
| Total Net Unrealized Gains (Losses) Included in Earnings(2) |
| ||||||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading |
| $ | 10 |
|
| $ | — |
|
| $ | 1 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 11 |
|
| $ | — |
|
| $ | 14 |
|
| $ | — |
|
| $ | 7 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 21 |
|
| $ | — |
|
Total debt securities |
|
| 10 |
|
|
| — |
|
|
| 1 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 11 |
|
|
| — |
|
|
| 14 |
|
|
| — |
|
|
| 7 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 21 |
|
|
| — |
|
Private equity |
|
| 16 |
|
|
| — |
|
|
| — |
|
|
| (6 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 10 |
|
|
| — |
|
|
| 9 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4 | ) |
|
| 5 |
|
|
| — |
|
Bank loans |
|
| 229 |
|
|
| — |
|
|
| — |
|
|
| (9 | ) |
|
| — |
|
|
| — |
|
|
| (3 | ) |
|
| 217 |
|
|
| — |
|
|
| 235 |
|
|
| — |
|
|
| 20 |
|
|
| — |
|
|
| — |
|
|
| 6 |
|
|
| — |
|
|
| 261 |
|
|
| — |
|
Total investments |
| $ | 255 |
|
| $ | — |
|
| $ | 1 |
|
| $ | (15 | ) |
| $ | — |
|
| $ | — |
|
| $ | (3 | ) |
| $ | 238 |
|
| $ | — |
|
|
| 258 |
|
|
| — |
|
|
| 27 |
|
|
| — |
|
|
| — |
|
|
| 6 |
|
|
| (4 | ) |
|
| 287 |
|
|
| — |
|
Total Level 3 assets |
| $ | 258 |
|
| $ | — |
|
| $ | 27 |
|
| $ | — |
|
| $ | — |
|
| $ | 6 |
|
| $ | (4 | ) |
| $ | 287 |
|
| $ | — |
| ||||||||||||||||||||||||||||||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities |
| $ | 262 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | 261 |
|
| $ | — |
|
| $ | 280 |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | 17 |
|
| $ | — |
|
| $ | — |
|
| $ | 298 |
|
| $ | (1 | ) |
Total Level 3 liabilities |
| $ | 262 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | 261 |
|
| $ | — |
|
| $ | 280 |
|
| $ | (1 | ) |
| $ | — |
|
| $ | — |
|
| $ | 17 |
|
| $ | — |
|
| $ | — |
|
| $ | 298 |
|
| $ | (1 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
(2) | Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date. |
Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the NineSix Months Ended SeptemberJune 30, 20202021
(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) |
|
| 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 |
|
| June 30, 2021 |
|
| Total Net Unrealized Gains (Losses) Included in Earnings(2) |
| ||||||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading |
| $ | 8 |
|
| $ | — |
|
| $ | 3 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 11 |
|
| $ | — |
|
| $ | 11 |
|
| $ | — |
|
| $ | 12 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | (2 | ) |
| $ | 21 |
|
| $ | — |
|
Total debt securities |
|
| 8 |
|
|
| — |
|
|
| 3 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 11 |
|
|
| — |
|
|
| 11 |
|
|
| — |
|
|
| 12 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2 | ) |
|
| 21 |
|
|
| — |
|
Private equity |
|
| 9 |
|
|
| — |
|
|
| 8 |
|
|
| (7 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 10 |
|
|
| — |
|
|
| 9 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4 | ) |
|
| 5 |
|
|
| — |
|
Bank loans |
|
| 177 |
|
|
| — |
|
|
| 36 |
|
|
| (9 | ) |
|
| — |
|
|
| 16 |
|
|
| (3 | ) |
|
| 217 |
|
|
| — |
|
|
| 232 |
|
|
| — |
|
|
| 29 |
|
|
| — |
|
|
| — |
|
|
| 10 |
|
|
| (10 | ) |
|
| 261 |
|
|
| — |
|
Total investments |
| $ | 194 |
|
| $ | — |
|
| $ | 47 |
|
| $ | (16 | ) |
| $ | — |
|
| $ | 16 |
|
| $ | (3 | ) |
| $ | 238 |
|
| $ | — |
|
|
| 252 |
|
|
| — |
|
|
| 41 |
|
|
| — |
|
|
| — |
|
|
| 10 |
|
|
| (16 | ) |
|
| 287 |
|
|
| — |
|
Total Level 3 assets |
| $ | 252 |
|
| $ | — |
|
| $ | 41 |
|
| $ | — |
|
| $ | — |
|
| $ | 10 |
|
| $ | (16 | ) |
| $ | 287 |
|
| $ | — |
| ||||||||||||||||||||||||||||||||||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other liabilities |
| $ | 388 |
|
| $ | (23 | ) |
| $ | — |
|
| $ | — |
|
| $ | (150 | ) |
| $ | — |
|
| $ | — |
|
| $ | 261 |
|
| $ | (5 | ) |
| $ | 272 |
|
| $ | (4 | ) |
| $ | — |
|
| $ | — |
|
| $ | 22 |
|
| $ | — |
|
| $ | — |
|
| $ | 298 |
|
| $ | (4 | ) |
Total Level 3 liabilities |
| $ | 388 |
|
| $ | (23 | ) |
| $ | — |
|
| $ | — |
|
| $ | (150 | ) |
| $ | — |
|
| $ | — |
|
| $ | 261 |
|
| $ | (5 | ) |
| $ | 272 |
|
| $ | (4 | ) |
| $ | — |
|
| $ | — |
|
| $ | 22 |
|
| $ | — |
|
| $ | — |
|
| $ | 298 |
|
| $ | (4 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
(2) | Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date. |
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 fundsrelated to securities held by CIPs is allocated to 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 SeptemberJune 30, 20212022 and December 31, 2020,2021, the fair value of the Company’s financial instruments not held at fair value are categorized in the table below:
| September 30, 2021 |
|
| December 31, 2020 |
|
|
|
| June 30, 2022 |
|
| December 31, 2021 |
|
|
|
| ||||||||||||||||||||
(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(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | $ | 7,361 |
|
| $ | 7,361 |
|
| $ | 8,664 |
|
| $ | 8,664 |
|
| Level 1 | (2) (3) | $ | 6,481 |
|
| $ | 6,481 |
|
| $ | 9,323 |
|
| $ | 9,323 |
|
| Level 1 | (2) (3) |
Other assets | $ | 48 |
|
| $ | 48 |
|
| $ | 69 |
|
| $ | 69 |
|
| Level 1 | (4) | $ | 44 |
|
| $ | 44 |
|
| $ | 22 |
|
| $ | 22 |
|
| Level 1 | (2) (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term borrowings | $ | 6,474 |
|
| $ | 6,836 |
|
| $ | 7,264 |
|
| $ | 7,883 |
|
| Level 2 | (5) | $ | 6,635 |
|
| $ | 6,102 |
|
| $ | 7,446 |
|
| $ | 7,735 |
|
| 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. |
(3) | At |
(4) | Other assets include restricted cash and cash collateral deposited with certain derivative counterparties. |
(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 determined using market prices and the EUR/USD foreign exchange rate at the end of |
Investments in Certain Entities that Calculate Net Asset ValueNAV Per 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, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||
June 30, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||
(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) |
| $ | 359 |
|
| $ | 123 |
|
| Daily/Monthly (21%) Quarterly (21%) N/R (58%) |
| 1 – 90 days | ||||||||||||||
Hedge funds/funds of hedge funds/ other |
| (a) |
| $ | 428 |
|
| $ | 103 |
|
| Daily/Monthly (32%) Quarterly (12%) N/R (56%) |
| 1 – 90 days | ||||||||||||||
Private equity funds |
| (b) |
|
| 633 |
|
|
| 302 |
|
| N/R |
| N/R |
| (b) |
|
| 853 |
|
|
| 215 |
|
| N/R |
| N/R |
Real assets funds |
| (c) |
|
| 213 |
|
|
| 229 |
|
| Quarterly (21%) N/R (79%) |
| 60 days |
| (c) |
|
| 263 |
|
|
| 245 |
|
| Quarterly (20%) N/R (80%) |
| 60 days |
Consolidated sponsored investment products: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private equity funds of funds |
| (d) |
|
| 5 |
|
|
| 3 |
|
| N/R |
| N/R | ||||||||||||||
Real assets funds |
| (c) |
|
| 87 |
|
|
| 106 |
|
| N/R |
| N/R |
| (d) |
|
| 95 |
|
|
| 91 |
|
| N/R |
| N/R |
Funds of hedge funds |
|
|
|
| 2 |
|
|
| 23 |
|
| N/R |
| N/R | ||||||||||||||
Other funds |
| (c) |
|
| 16 |
|
|
| 64 |
|
| N/R |
| N/R | ||||||||||||||
Total |
|
|
| $ | 1,299 |
|
| $ | 786 |
|
|
|
|
|
|
|
| $ | 1,655 |
|
| $ | 718 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||
December 31, 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) |
| $ | 313 |
|
| $ | 101 |
|
| Daily/Monthly (21%) Quarterly (21%) N/R (58%) |
| 1 – 90 days | ||||||||||||||
Hedge funds/funds of hedge funds/ other |
| (a) |
| $ | 369 |
|
| $ | 141 |
|
| Daily/Monthly (20%) Quarterly (20%) N/R (60%) |
| 1 – 90 days | ||||||||||||||
Private equity funds |
| (b) |
|
| 315 |
|
|
| 372 |
|
| N/R |
| N/R |
| (b) |
|
| 846 |
|
|
| 153 |
|
| N/R |
| N/R |
Real assets funds |
| (c) |
|
| 218 |
|
|
| 205 |
|
| Quarterly (31%) N/R (69%) |
| 60 days |
| (c) |
|
| 234 |
|
|
| 245 |
|
| Quarterly (20%) N/R (80%) |
| 60 days |
Consolidated sponsored investment products: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Private equity funds of funds |
| (d) |
|
| 19 |
|
|
| 7 |
|
| N/R |
| N/R | ||||||||||||||
Real assets funds |
| (c) |
|
| 75 |
|
|
| 94 |
|
| N/R |
| N/R |
| (d) |
|
| 90 |
|
|
| 101 |
|
| N/R |
| N/R |
Other funds |
| (c) |
|
| 6 |
|
|
| 25 |
|
| N/R |
| N/R | ||||||||||||||
Total |
|
|
| $ | 940 |
|
| $ | 779 |
|
|
|
|
|
|
|
| $ | 1,545 |
|
| $ | 665 |
|
|
|
|
|
N/R – not redeemable
(1) | Comprised of equity method investments, which include investment companies |
(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. The liquidation period for the investments in the funds that are not subject to redemption is unknown at both |
(b) | This category includes 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 |
(c) | This category includes several real assets funds that invest directly and indirectly in real estate 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 and realizations of the underlying assets of the funds. The liquidation period for the investments in the funds that are not subject to redemptions is unknown at both |
(d) | This category includes the underlying third-party private equity funds within consolidated BlackRock sponsored private equity funds of funds. |
Fair Value Option.
At SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company elected the fair value option for certain investments in CLOs of approximately $54$43 million and $35$47 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 SeptemberJune 30, 20212022 and December 31, 2020:2021:
|
| September 30, |
|
| December 31, |
|
| June 30, |
|
| December 31, |
| ||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
CLO Bank loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate principal amounts outstanding |
| $ | 280 |
|
| $ | 250 |
|
| $ | 280 |
|
| $ | 281 |
|
Fair value |
|
| 282 |
|
|
| 248 |
|
|
| 279 |
|
|
| 284 |
|
Aggregate unpaid principal balance in excess of (less than) fair value |
| $ | (2 | ) |
| $ | 2 |
|
| $ | 1 |
|
| $ | (3 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLO Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate principal amounts outstanding |
| $ | 275 |
|
| $ | 244 |
|
| $ | 293 |
|
| $ | 275 |
|
Fair value |
| $ | 278 |
|
| $ | 246 |
|
| $ | 281 |
|
| $ | 278 |
|
At SeptemberJune 30, 2021,2022, the principal amounts outstanding of the borrowings issued by the CLOs mature in 2030.
During the three and ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, the net gains (losses) from the change in fair value of the bank loans and borrowings held by the consolidated CLO were not material and were recorded in nonoperating (expense)net gain (loss) on the condensed consolidated statements of income. The change in fair value of the assets and liabilities included interest income and expense, respectively.
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 SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had outstanding total return swaps with aggregate notional values of approximately $801$651 million and $833$720 million, respectively.respectively.
The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange movements. At SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had outstanding forward foreign currency exchange contracts with aggregate notional values of approximately $2.2$1.7 billion and $2.81.8 billion, respectively, and with expiration dates in October 2021July 2022 and January 2021,2022, respectively.
At both SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had a derivative providing credit protection with a notional amount of approximately $17 million 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 expected discounted future cash outflows under the arrangement.
The following table presents the fair values of derivative instruments recognized in the condensed consolidated statements of financial condition at SeptemberJune 30, 20212022 and December 31, 2020:2021:
(in millions) | Assets |
|
| Liabilities |
| 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 |
| Statement of Financial Condition Classification |
| June 30, 2022 |
|
| December 31, 2021 | Statement of Financial Condition Classification |
| June 30, 2022 |
| December 31, 2021 |
| ||||||||
Total return swaps | Other assets |
| $ | 22 |
|
| $ | — |
|
| Other liabilities |
| $ | 1 |
|
| $ | 50 |
| Other assets |
| $ | 32 |
| $ | 5 | Other liabilities |
| $ | 5 | $ | 14 |
| ||
Forward foreign currency exchange contracts | Other assets |
|
| 1 |
|
|
| 13 |
|
| Other liabilities |
|
| 28 |
|
|
| 5 |
| Other assets |
|
| 1 |
| 34 |
|
|
| 19 |
| — |
| |||
Total |
|
| $ | 23 |
|
| $ | 13 |
|
|
|
| $ | 29 |
|
| $ | 55 |
|
|
| $ | 33 | $ | 39 |
| $ | 24 | 14 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents realized and unrealized gains (losses) recognized in the condensed consolidated statements of income on derivative instruments:
|
|
|
| Three Months Ended |
|
| Nine Months Ended |
|
|
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
|
|
|
| September 30, |
|
| September 30, |
|
|
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) |
| Statement of Income |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| Statement of Income |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Derivative Instruments |
| Classification |
| Gains (Losses) |
|
| Gains (Losses) |
|
| Classification |
| Gains (Losses) |
|
| Gains (Losses) |
| ||||||||||||||||||||
Total return swaps |
| Nonoperating income (expense) |
| $ | 14 |
|
| $ | (42 | ) |
| $ | (70 | ) |
| $ | 9 |
|
| Nonoperating income (expense) |
| $ | 62 |
|
| $ | (50 | ) |
| $ | 103 |
|
| $ | (84 | ) |
Forward foreign currency exchange contracts |
| General and administration expense |
|
| (46 | ) |
|
| 64 |
|
|
| (36 | ) |
|
| (34 | ) |
| General and administration expense |
|
| (129 | ) |
|
| 3 |
|
|
| (171 | ) |
|
| 10 |
|
Total gain (loss) from derivative instruments | Total gain (loss) from derivative instruments |
| $ | (32 | ) |
| $ | 22 |
|
| $ | (106 | ) |
| $ | (25 | ) | Total gain (loss) from derivative instruments |
| $ | (67 | ) |
| $ | (47 | ) |
| $ | (68 | ) |
| $ | (74 | ) |
The Company consolidates certain sponsored investment funds, which may utilize derivative instruments as a part of the funds’ investment strategies. The changeschange in fair value of such derivatives, which areis recorded in nonoperating income (expense), werewas not material for the three and ninesix months ended SeptemberJune 30, 20212022 and 2020.2021.
See Note 15, Borrowings, in the 20202021 Form 10-K for more information on the Company’s net investment hedge.
10. Goodwill
Goodwill activity during the ninesix months ended SeptemberJune 30, 20212022 was as follows:
(in millions) |
|
|
|
December 31, 2020 | $ | 14,551 |
|
Acquisitions(1) |
| 816 |
|
Other(2) |
| (7 | ) |
September 30, 2021 | $ | 15,360 |
|
(in millions) |
|
|
|
December 31, 2021 | $ | 15,351 |
|
Other(1) |
| (5 | ) |
June 30, 2022 | $ | 15,346 |
|
|
|
|
|
11. Intangible Assets
The carrying amounts of identifiable intangible assets are summarized as follows:
(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 |
|
(in millions) | Indefinite-lived |
|
| Finite-lived |
|
| Total |
| |||
December 31, 2021 | $ | 17,578 |
|
| $ | 875 |
|
| $ | 18,453 |
|
Amortization expense |
| — |
|
|
| (76 | ) |
|
| (76 | ) |
June 30, 2022 | $ | 17,578 |
|
| $ | 799 |
|
| $ | 18,377 |
|
|
|
12. Leases
The following table presents components of lease cost included in general and administration expense on the condensed consolidated statementstatements of income:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Lease cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating lease cost(1) | $ | 50 |
|
| $ | 37 |
|
| $ | 128 |
|
| $ | 110 |
| |||||||||||||||
Variable lease cost(2) |
| 10 |
|
|
| 10 |
|
|
| 30 |
|
|
| 29 |
| |||||||||||||||
Operating lease cost(1) | $ | 54 |
|
| $ | 39 |
|
| $ | 105 |
|
| $ | 78 |
| |||||||||||||||
Variable lease cost(2) |
| 11 |
|
|
| 10 |
|
|
| 22 |
|
|
| 20 |
| |||||||||||||||
Total lease cost | $ | 60 |
|
| $ | 47 |
|
| $ | 158 |
|
| $ | 139 |
| $ | 65 |
|
| $ | 49 |
|
| $ | 127 |
|
| $ | 98 |
|
(1) | Amounts include short-term leases, which are immaterial for the three and |
(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 |
|
| Six Months Ended |
| ||||||||||
|
| September 30, |
|
| June 30, |
| ||||||||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash flows from operating leases included in the measurement |
|
|
|
|
|
|
|
| ||||||||
of operating lease liabilities |
| $ | 108 |
|
| $ | 114 |
| ||||||||
Operating cash flows from operating leases included in the measurement of operating lease liabilities |
| $ | 82 |
|
| $ | 81 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental noncash information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROU assets in exchange for operating lease liabilities |
| $ | 1,297 |
|
| $ | 77 |
|
| $ | 37 |
|
| $ | 28 |
|
| September 30, |
| December 31, | June 30, |
| December 31, | ||||||||||||
| 2021 |
| 2020 | 2022 |
| 2021 | ||||||||||||
Lease term and discount rate: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average remaining lease term |
| 16 |
| years |
|
| 8 |
| years |
| 16 |
| years |
|
| 16 |
| years |
Weighted-average discount rate |
| 3 |
| % |
|
| 3 |
| % |
| 3 |
| % |
|
| 3 |
| % |
13. Other Assets
At SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had $582$553 million and $399$583 million of equity method investments, respectively, recorded within other assets on the condensed consolidated statements of financial condition.condition, since such investees are considered to be an extension of BlackRock’s core business. BlackRock’s share of these investees’ underlying net income or loss is based upon the most currently available information and is recorded within advisory and other revenue. 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.
iCapital
On March 10, 2020, in connection with a 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 SeptemberAt June 30, 2020. Following this transaction,2022 and December 31, 2021, the Company accounts for its interest in iCapital as an equityhad $304 million and $268 million of other nonequity method investment, which is included incorporate minority investments recorded within other assets on the condensed consolidated statements of financial condition. Duringcondition, which included investments in equity securities, generally measured at fair value or under the three and nine months ended September 30, 2021, BlackRockmeasurement alternative to fair value for nonmarketable securities. Changes in value of these securities are recorded ain nonoperating noncash, pre-tax gain of $107 million inincome (expense) on the condensed consolidated statements of incomeincome. See Note 2, Significant Accounting Policies, in connection with iCapital’s most recent third-party equity financing. At September 30,the notes to the consolidated financial statements contained in the 2021 and December 31, 2020, the carrying value of the Company’s interest in iCapital was approximately $401 million and $296 million, respectively.
Form 10-K for further information.
14. Borrowings
Short-Term Borrowings
20212022 Revolving Credit Facility. Since 2011, the Company has maintained an unsecured revolving credit facility which is available for working capital and general corporate purposes (the “2022 credit facility”). In March 2021,2022, the Company’s2022 credit facility was amended to, among other things, (i) increase the aggregate commitment amount by $300 million to $4.4$4.7 billion, and to(ii) extend the maturity date to March 2026 (the “2021 credit facility”). In addition,2027, (iii) change 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 onfor borrowings outstanding accrues atdenominated in US dollars from a rate based on the applicable London Interbank Offered Rate (“LIBOR”) to a rate based on the secured overnight financing rate (“SOFR”) subject to certain adjustments and (iv) raise and/or an applicable replacement benchmark, plus a spread.add certain specified targets for the sustainability-linked pricing mechanics. The 20212022 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasingwhich could increase the overall size of the 20212022 credit facility to an aggregate principal amount notof up to exceed $5.4$5.7 billion. The 20212022 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 SeptemberJune 30, 2021. The 2021 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities.2022. At SeptemberJune 30, 2021,2022, the Company had 0 amount outstanding under the 20212022 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 billion. The commercial paper program is currently supported by the 20212022 credit facility. At SeptemberJune 30, 2021,2022, BlackRock had 0 CP Notes outstanding.
Long-Term BorrowingsNotes
The carrying value and fair value of long-term borrowingsnotes determined using market prices and EUR/USD foreign exchange rate at SeptemberJune 30, 20212022 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(1) |
|
| Carrying Value |
|
| Fair Value |
| ||||||||
3.375% Notes due 2022 | $ | 750 |
|
| $ | — |
|
| $ | 750 |
|
| $ | 766 |
| |||||||||||||||
3.50% Notes due 2024 |
| 1,000 |
|
|
| (2 | ) |
|
| 998 |
|
|
| 1,071 |
| $ | 1,000 |
|
| $ | (2 | ) |
| $ | 998 |
|
| $ | 1,005 |
|
1.25% Notes due 2025 |
| 811 |
|
|
| (3 | ) |
|
| 808 |
|
|
| 851 |
|
| 732 |
|
|
| (2 | ) |
|
| 730 |
|
|
| 712 |
|
3.20% Notes due 2027 |
| 700 |
|
|
| (4 | ) |
|
| 696 |
|
|
| 767 |
|
| 700 |
|
|
| (3 | ) |
|
| 697 |
|
|
| 691 |
|
3.25% Notes due 2029 |
| 1,000 |
|
|
| (11 | ) |
|
| 989 |
|
|
| 1,097 |
|
| 1,000 |
|
|
| (10 | ) |
|
| 990 |
|
|
| 947 |
|
2.40% Notes due 2030 |
| 1,000 |
|
|
| (6 | ) |
|
| 994 |
|
|
| 1,034 |
|
| 1,000 |
|
|
| (6 | ) |
|
| 994 |
|
|
| 878 |
|
1.90% Notes due 2031 |
| 1,250 |
|
|
| (11 | ) |
|
| 1,239 |
|
|
| 1,250 |
|
| 1,250 |
|
|
| (10 | ) |
|
| 1,240 |
|
|
| 1,040 |
|
Total Long-term Borrowings | $ | 6,511 |
|
| $ | (37 | ) |
| $ | 6,474 |
|
| $ | 6,836 |
| |||||||||||||||
2.10% Notes due 2032 |
| 1,000 |
|
|
| (14 | ) |
|
| 986 |
|
|
| 829 |
| |||||||||||||||
Total long-term notes | $ | 6,682 |
|
| $ | (47 | ) |
| $ | 6,635 |
|
| $ | 6,102 |
|
(1) | The unamortized discount and debt issuance costs are being amortized over the term of the notes. |
Long-term notes at December 31, 2021 had a carrying value of $7.4 billion and a fair value of $7.7 billion, determined using market prices and EUR/USD foreign exchange rate at December 31, 2021.
In May 2021,June 2022, the Company fully repaid $750 million of 4.25%3.375% notes at maturity.
Long-term borrowings at December 31, 2020 had a carrying value of $7.3 billion and a fair value of $7.9 billion, determined using market prices at the end of December 31, 2020.
See Note 15, Borrowings, in the 20202021 Form 10-K for more information regarding the Company’s borrowings.
15. Commitments and Contingencies
Investment Commitments. At SeptemberJune 30, 2021,2022, the Company had $905$806 million of various capital commitments to fund sponsored investment products, including CIPs. These 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.
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 from acquired contracts. The fair value of the remaining aggregate contingent payments at September 30, 2021 totaled $62 million 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 9, Derivatives and Hedging, for further discussion.
Legal Proceedings. From time to time, BlackRock receives subpoenas or other requests for information from various US federal and state governmental and regulatory authorities and international governmental and regulatory authorities in connection with industry-wide or other investigations or proceedings. It is BlackRock’s policy to cooperate fully with such matters. The Company, 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 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 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 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”) 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 in investment options managed by BlackRock. On October 18, 2017, the plaintiffs filed an Amended Complaint, which, among other things, added as defendants certain current and former members of the BlackRock Retirement and Investment Committees. The Amended Complaint also included a new purported class claim on behalf of investors in certain CTFs managed by BTC. Specifically, the plaintiffs allege that BTC, as fiduciary to the CTFs, engaged in self-dealing by, most significantly, selecting itself as the securities lending 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 plaintiffs to file a Second Amended Complaint (“SAC”) which added as defendants 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 settlement was presented to the court for approval on March 23, 2021. There were no class member objections to the settlement following notice, and the court granted final approval of the settlement on November 3, 2021. We expect a final judgment to be entered in the 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 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. The amount of securities on loan as of SeptemberJune 30, 20212022 and subject to this type of indemnification was $279$268 billion. In the Company’s capacity as lending agent, cash and securities totaling $299$284 billion were held as collateral for indemnified securities on loan at SeptemberJune 30, 2021.2022. The fair value of these indemnifications was not material at SeptemberJune 30, 2021.2022.
16. Revenue
The table below presents detail of revenue for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 and includes the product mix of investment advisory, administration fees and securities lending revenue, and performance fees.
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Investment advisory, administration fees and securities lending revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active | $ | 674 |
|
| $ | 457 |
|
| $ | 1,891 |
|
| $ | 1,236 |
| $ | 550 |
|
| $ | 641 |
|
| $ | 1,166 |
|
| $ | 1,217 |
|
ETFs |
| 1,212 |
|
|
| 880 |
|
|
| 3,436 |
|
|
| 2,551 |
|
| 1,103 |
|
|
| 1,156 |
|
|
| 2,261 |
|
|
| 2,224 |
|
Non-ETF Index |
| 207 |
|
|
| 164 |
|
|
| 581 |
|
|
| 505 |
|
| 186 |
|
|
| 198 |
|
|
| 373 |
|
|
| 374 |
|
Equity subtotal |
| 2,093 |
|
|
| 1,501 |
|
|
| 5,908 |
|
|
| 4,292 |
|
| 1,839 |
|
|
| 1,995 |
|
|
| 3,800 |
|
|
| 3,815 |
|
Fixed income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 561 |
|
|
| 498 |
|
|
| 1,631 |
|
|
| 1,443 |
|
| 503 |
|
|
| 545 |
|
|
| 1,037 |
|
|
| 1,070 |
|
ETFs |
| 304 |
|
|
| 297 |
|
|
| 893 |
|
|
| 817 |
|
| 274 |
|
|
| 294 |
|
|
| 563 |
|
|
| 589 |
|
Non-ETF Index |
| 121 |
|
|
| 113 |
|
|
| 350 |
|
|
| 354 |
|
| 102 |
|
|
| 116 |
|
|
| 220 |
|
|
| 229 |
|
Fixed income subtotal |
| 986 |
|
|
| 908 |
|
|
| 2,874 |
|
|
| 2,614 |
|
| 879 |
|
|
| 955 |
|
|
| 1,820 |
|
|
| 1,888 |
|
Multi-asset |
| 369 |
|
|
| 289 |
|
|
| 1,041 |
|
|
| 852 |
|
| 331 |
|
|
| 344 |
|
|
| 690 |
|
|
| 672 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 166 |
|
|
| 140 |
|
|
| 501 |
|
|
| 416 |
|
| 184 |
|
|
| 167 |
|
|
| 363 |
|
|
| 335 |
|
Liquid alternatives |
| 163 |
|
|
| 132 |
|
|
| 460 |
|
|
| 361 |
|
| 161 |
|
|
| 150 |
|
|
| 328 |
|
|
| 297 |
|
Currency and commodities(1) |
| 55 |
|
|
| 51 |
|
|
| 163 |
|
|
| 118 |
| |||||||||||||||
Currency and commodities(1) |
| 62 |
|
|
| 55 |
|
|
| 118 |
|
|
| 108 |
| |||||||||||||||
Alternatives subtotal |
| 384 |
|
|
| 323 |
|
|
| 1,124 |
|
|
| 895 |
|
| 407 |
|
|
| 372 |
|
|
| 809 |
|
|
| 740 |
|
Long-term |
| 3,832 |
|
|
| 3,021 |
|
|
| 10,947 |
|
|
| 8,653 |
|
| 3,456 |
|
|
| 3,666 |
|
|
| 7,119 |
|
|
| 7,115 |
|
Cash management |
| 111 |
|
|
| 204 |
|
|
| 345 |
|
|
| 593 |
|
| 232 |
|
|
| 91 |
|
|
| 402 |
|
|
| 234 |
|
Total investment advisory, administration fees and securities lending revenue |
| 3,943 |
|
|
| 3,225 |
|
|
| 11,292 |
|
|
| 9,246 |
|
| 3,688 |
|
|
| 3,757 |
|
|
| 7,521 |
|
|
| 7,349 |
|
Investment advisory performance fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 8 |
|
|
| 4 |
|
|
| 70 |
|
|
| 29 |
|
| 3 |
|
|
| 36 |
|
|
| 15 |
|
|
| 62 |
|
Fixed income |
| 2 |
|
|
| 9 |
|
|
| 31 |
|
|
| 13 |
|
| 13 |
|
|
| 15 |
|
|
| 22 |
|
|
| 29 |
|
Multi-asset |
| — |
|
|
| 10 |
|
|
| 17 |
|
|
| 13 |
|
| 7 |
|
|
| 9 |
|
|
| 12 |
|
|
| 17 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 50 |
|
|
| 6 |
|
|
| 147 |
|
|
| 55 |
|
| 65 |
|
|
| 90 |
|
|
| 102 |
|
|
| 97 |
|
Liquid alternatives |
| 285 |
|
|
| 503 |
|
|
| 549 |
|
|
| 575 |
|
| 18 |
|
|
| 190 |
|
|
| 53 |
|
|
| 264 |
|
Alternatives subtotal |
| 335 |
|
|
| 509 |
|
|
| 696 |
|
|
| 630 |
|
| 83 |
|
|
| 280 |
|
|
| 155 |
|
|
| 361 |
|
Total performance fees |
| 345 |
|
|
| 532 |
|
|
| 814 |
|
|
| 685 |
|
| 106 |
|
|
| 340 |
|
|
| 204 |
|
|
| 469 |
|
Technology services revenue |
| 320 |
|
|
| 282 |
|
|
| 942 |
|
|
| 834 |
|
| 332 |
|
|
| 316 |
|
|
| 673 |
|
|
| 622 |
|
Distribution fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retrocessions |
| 294 |
|
|
| 188 |
|
|
| 796 |
|
|
| 519 |
|
| 269 |
|
|
| 264 |
|
|
| 548 |
|
|
| 502 |
|
12b-1 fees (US mutual fund distribution fees) |
| 91 |
|
|
| 85 |
|
|
| 263 |
|
|
| 254 |
|
| 80 |
|
|
| 87 |
|
|
| 168 |
|
|
| 172 |
|
Other |
| 16 |
|
|
| 15 |
|
|
| 51 |
|
|
| 44 |
|
| 12 |
|
|
| 18 |
|
|
| 26 |
|
|
| 35 |
|
Total distribution fees |
| 401 |
|
|
| 288 |
|
|
| 1,110 |
|
|
| 817 |
|
| 361 |
|
|
| 369 |
|
|
| 742 |
|
|
| 709 |
|
Advisory and other revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advisory |
| 13 |
|
|
| 14 |
|
|
| 37 |
|
|
| 48 |
|
| 15 |
|
|
| 9 |
|
|
| 31 |
|
|
| 24 |
|
Other |
| 28 |
|
|
| 28 |
|
|
| 73 |
|
|
| 97 |
|
| 24 |
|
|
| 29 |
|
|
| 54 |
|
|
| 45 |
|
Total advisory and other revenue |
| 41 |
|
|
| 42 |
|
|
| 110 |
|
|
| 145 |
|
| 39 |
|
|
| 38 |
|
|
| 85 |
|
|
| 69 |
|
Total revenue | $ | 5,050 |
|
| $ | 4,369 |
|
| $ | 14,268 |
|
| $ | 11,727 |
| $ | 4,526 |
|
| $ | 4,820 |
|
| $ | 9,225 |
|
| $ | 9,218 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
By client type: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail | $ | 1,291 |
|
| $ | 938 |
|
| $ | 3,647 |
|
| $ | 2,635 |
| $ | 1,139 |
|
| $ | 1,231 |
|
| $ | 2,363 |
|
| $ | 2,356 |
|
ETFs |
| 1,571 |
|
|
| 1,228 |
|
|
| 4,493 |
|
|
| 3,487 |
|
| 1,436 |
|
|
| 1,505 |
|
|
| 2,937 |
|
|
| 2,922 |
|
Institutional: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 684 |
|
|
| 594 |
|
|
| 1,991 |
|
|
| 1,714 |
|
| 636 |
|
|
| 657 |
|
|
| 1,311 |
|
|
| 1,307 |
|
Index |
| 286 |
|
|
| 261 |
|
|
| 816 |
|
|
| 817 |
|
| 245 |
|
|
| 273 |
|
|
| 508 |
|
|
| 530 |
|
Total institutional |
| 970 |
|
|
| 855 |
|
|
| 2,807 |
|
|
| 2,531 |
|
| 881 |
|
|
| 930 |
|
|
| 1,819 |
|
|
| 1,837 |
|
Long-term |
| 3,832 |
|
|
| 3,021 |
|
|
| 10,947 |
|
|
| 8,653 |
|
| 3,456 |
|
|
| 3,666 |
|
|
| 7,119 |
|
|
| 7,115 |
|
Cash management |
| 111 |
|
|
| 204 |
|
|
| 345 |
|
|
| 593 |
|
| 232 |
|
|
| 91 |
|
|
| 402 |
|
|
| 234 |
|
Total | $ | 3,943 |
|
| $ | 3,225 |
|
| $ | 11,292 |
|
| $ | 9,246 |
| $ | 3,688 |
|
| $ | 3,757 |
|
| $ | 7,521 |
|
| $ | 7,349 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By investment style: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active | $ | 1,928 |
|
| $ | 1,511 |
|
| $ | 5,509 |
|
| $ | 4,292 |
| $ | 1,727 |
|
| $ | 1,842 |
|
| $ | 3,578 |
|
| $ | 3,581 |
|
Index and ETFs |
| 1,904 |
|
|
| 1,510 |
|
|
| 5,438 |
|
|
| 4,361 |
|
| 1,729 |
|
|
| 1,824 |
|
|
| 3,541 |
|
|
| 3,534 |
|
Long-term |
| 3,832 |
|
|
| 3,021 |
|
|
| 10,947 |
|
|
| 8,653 |
|
| 3,456 |
|
|
| 3,666 |
|
|
| 7,119 |
|
|
| 7,115 |
|
Cash management |
| 111 |
|
|
| 204 |
|
|
| 345 |
|
|
| 593 |
|
| 232 |
|
|
| 91 |
|
|
| 402 |
|
|
| 234 |
|
Total | $ | 3,943 |
|
| $ | 3,225 |
|
| $ | 11,292 |
|
| $ | 9,246 |
| $ | 3,688 |
|
| $ | 3,757 |
|
| $ | 7,521 |
|
| $ | 7,349 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 SeptemberJune 30, 20212022 and 2020:2021:
SeptemberJune 30, 2022
| Remainder of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(in millions) | 2022 |
|
|
| 2023 |
|
|
| 2024 |
|
|
| 2025 |
|
| Thereafter |
|
| Total |
| |||
Investment advisory and administration fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alternatives(1)(2) | $ | 91 |
|
| $ | 169 |
|
| $ | 106 |
|
| $ | 68 |
|
| $ | 49 |
|
| $ | 483 |
|
June 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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Remainder of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
(in millions) | 2020 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2023 |
|
| Thereafter |
|
| Total |
| 2021 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2024 |
|
| Thereafter |
|
| Total |
| ||||||
Investment advisory and administration fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alternatives(1)(2) | $ | 33 |
|
| $ | 125 |
|
| $ | 108 |
|
| $ | 92 |
|
| $ | 61 |
|
| $ | 419 |
| |||||||||||||||||||||||
Alternatives(1)(2) | $ | 86 |
|
| $ | 168 |
|
| $ | 137 |
|
| $ | 82 |
|
| $ | 51 |
|
| $ | 524 |
|
(1) | Investment advisory and administration fees include management fees related to certain alternative products, which are based on contractual committed capital outstanding at |
(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 ninesix months ended SeptemberJune 30, 20212022 and 2020:2021:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Beginning balance | $ | 1,132 |
|
| $ | 418 |
|
| $ | 584 |
|
| $ | 483 |
| $ | 1,699 |
|
| $ | 748 |
|
| $ | 1,508 |
|
| $ | 584 |
|
Net increase (decrease) in unrealized allocations |
| 277 |
|
|
| 29 |
|
|
| 904 |
|
|
| 4 |
|
| (46 | ) |
|
| 461 |
|
|
| 177 |
|
|
| 627 |
|
Performance fee revenue recognized |
| (43 | ) |
|
| — |
|
|
| (122 | ) |
|
| (40 | ) |
| (61 | ) |
|
| (77 | ) |
|
| (93 | ) |
|
| (79 | ) |
Ending balance | $ | 1,366 |
|
| $ | 447 |
|
| $ | 1,366 |
|
| $ | 447 |
| $ | 1,592 |
|
| $ | 1,132 |
|
| $ | 1,592 |
|
| $ | 1,132 |
|
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 SeptemberJune 30, 20212022 and 2020:2021:
SeptemberJune 30, 2022
| Remainder of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(in millions) | 2022 |
|
|
| 2023 |
|
|
| 2024 |
|
|
| 2025 |
|
| Thereafter |
|
| Total |
| |||
Technology services revenue(1)(2) | $ | 65 |
|
| $ | 70 |
|
| $ | 42 |
|
| $ | 27 |
|
| $ | 23 |
|
| $ | 227 |
|
June 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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Remainder of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
(in millions) | 2020 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2023 |
|
| Thereafter |
|
| Total |
| 2021 |
|
|
| 2022 |
|
|
| 2023 |
|
|
| 2024 |
|
| Thereafter |
|
| Total |
| ||||||
Technology services revenue(1)(2) | $ | 37 |
|
| $ | 95 |
|
| $ | 47 |
|
| $ | 22 |
|
| $ | 18 |
|
| $ | 219 |
| |||||||||||||||||||||||
Technology services revenue(1)(2) | $ | 67 |
|
| $ | 71 |
|
| $ | 40 |
|
| $ | 20 |
|
| $ | 14 |
|
| $ | 212 |
|
(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 SeptemberJune 30, 2021,2022, the estimated fixed minimum fees for the remainder of the year approximated $193$425 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 ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, which is included in other liabilities on the condensed consolidated statements of financial condition:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Beginning balance | $ | 107 |
|
| $ | 108 |
|
| $ | 123 |
|
| $ | 116 |
| $ | 113 |
|
| $ | 111 |
|
| $ | 122 |
|
| $ | 123 |
|
Additions (1) |
| 28 |
|
|
| 30 |
|
|
| 72 |
|
|
| 88 |
| |||||||||||||||
Additions(1) |
| 27 |
|
|
| 26 |
|
|
| 49 |
|
|
| 44 |
| |||||||||||||||
Revenue recognized that was included in the beginning balance |
| (31 | ) |
|
| (33 | ) |
|
| (91 | ) |
|
| (99 | ) |
| (32 | ) |
|
| (30 | ) |
|
| (63 | ) |
|
| (60 | ) |
Ending balance | $ | 104 |
|
| $ | 105 |
|
| $ | 104 |
|
| $ | 105 |
| $ | 108 |
|
| $ | 107 |
|
| $ | 108 |
|
| $ | 107 |
|
(1) | Amounts are net of revenue recognized. |
17. Stock-Based Compensation
Restricted Stock and RSUs.
Restricted stock and restricted stock units (“RSUs”) activity for the ninesix months ended SeptemberJune 30, 20212022 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, 2020 |
| 2,139,930 |
|
| $ | 489.81 |
| |||||||
December 31, 2021 |
| 2,183,017 |
|
| $ | 586.45 |
| |||||||
Granted |
| 875,480 |
|
| $ | 747.49 |
|
| 733,872 |
|
| $ | 830.24 |
|
Converted |
| (745,474 | ) |
| $ | 506.78 |
|
| (840,871 | ) |
| $ | 500.83 |
|
Forfeited |
| (54,874 | ) |
| $ | 571.05 |
|
| (43,037 | ) |
| $ | 703.76 |
|
September 30, 2021 |
| 2,215,062 |
|
| $ | 583.93 |
| |||||||
June 30, 2022 |
| 2,032,981 |
|
| $ | 707.39 |
|
In January 2021,2022, the Company granted 470,253498,633 RSUs or shares of restricted stock to employees as part of 20202021 annual incentive compensation that vest ratably over three years from the date of grant and 247,621197,817 RSUs or shares of restricted stock to employees that cliff vest 100% on January 31, 2024.2025. 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 ninesix months ended SeptemberJune 30, 20212022 was $654$609 million.
At SeptemberJune 30, 2021,2022, the intrinsic value of outstanding RSUs was $1.9$1.2 billion, reflecting a closing stock price of $838.66.$609.04.
At SeptemberJune 30, 2021,2022, total unrecognized stock-based compensation expense related to unvested RSUs was $607$743 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of 1.21.4 years.
Performance-Based RSUs.
Performance-based RSU activity for the ninesix months ended SeptemberJune 30, 20212022 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, 2020 |
| 700,217 |
|
| $ | 494.51 |
| |||||||
December 31, 2021 |
| 668,805 |
|
| $ | 533.48 |
| |||||||
Granted |
| 162,029 |
|
| $ | 739.22 |
|
| 143,846 |
|
| $ | 820.28 |
|
Additional shares granted due to attainment of performance measures |
| 4,545 |
|
| $ | 566.44 |
| |||||||
Additional shares due to attainment of performance measures |
| 111,991 |
|
| $ | 410.32 |
| |||||||
Converted |
| (193,872 | ) |
| $ | 566.44 |
|
| (385,134 | ) |
| $ | 410.32 |
|
Forfeited |
| (1,584 | ) |
| $ | 410.32 |
|
| (8,454 | ) |
| $ | 662.34 |
|
September 30, 2021 |
| 671,335 |
|
| $ | 533.48 |
| |||||||
June 30, 2022 |
| 531,054 |
|
| $ | 672.47 |
|
In January 2021,2022, the Company granted 162,029143,846 performance-based RSUs to certain employees that cliff vest 100% on January 31, 2024.2025. 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 2021,2022, the Company granted 4,545111,991 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 ninesix months ended SeptemberJune 30, 20212022 was $122$164 million.
At SeptemberJune 30, 2021,2022, the intrinsic value of outstanding performance-based RSUs was $563$323 million, reflecting a closing stock price of $838.66.$609.04.
At SeptemberJune 30, 2021,2022, total unrecognized stock-based compensation expense related to unvested performance-based awards was $190$197 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of 1.21.4 years.
See Note 18, Stock-Based Compensation, in the 20202021 Form 10-K for more information on performance-based RSUs.
Performance-based Stock Options.
Stock option activity for the ninesix months ended SeptemberJune 30, 20212022 is summarized below.
Outstanding at | Shares Under Option |
|
| Weighted Average Exercise Price |
| Shares Under Option |
|
| Weighted Average Exercise Price |
| ||||
December 31, 2020 |
| 1,915,792 |
|
| $ | 513.50 |
| |||||||
December 31, 2021 |
| 1,817,923 |
|
| $ | 513.50 |
| |||||||
Forfeited |
| (28,742 | ) |
| $ | 513.50 |
|
| (60,392 | ) |
| $ | 513.50 |
|
September 30, 2021 |
| 1,887,050 |
|
| $ | 513.50 |
| |||||||
June 30, 2022 |
| 1,757,531 |
|
| $ | 513.50 |
|
Vesting of the performance-based 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 the attainment of Company performance measures during the four-year performance period. If both hurdles are achieved, the award will vest in 3 equal installments at the end of 2022, 2023 and 2024, respectively. Both hurdles have been achieved. Vested options are exercisable for up to nine years following the grant date. The stock price hurdle was achieved in December of 2020.awards are generally forfeited if the employee leaves the Company before the respective vesting date. The expense for each tranche is amortized over the respective requisite service period.
At SeptemberJune 30, 2021,2022, total unrecognized stock-based compensation expense related to unvested performance-based stock options was $55$32 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of 2.21.4 years. At SeptemberJune 30, 2021,2022, the weighted-average remaining life of the awards is approximately 5.24.4 years.
See Note 18, Stock-Based Compensation, in the 20202021 Form 10-K for more information on performance-based stock options.
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 may have adverse tax consequences that could discourage such transfers.
At SeptemberJune 30, 2021,2022, the Company was required to maintain approximately $2.4$2.2 billion in net capital in certain regulated subsidiaries, including BTCBlackRock Institutional Trust Company, N.A. (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 UK, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.
19. Accumulated Other Comprehensive Income (Loss)
The following table presents changes in AOCI for the three and ninesix months ended SeptemberJune 30, 20212022 and 2020:2021:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Beginning balance | $ | (388 | ) |
| $ | (781 | ) |
| $ | (337 | ) |
| $ | (571 | ) | $ | (675 | ) |
| $ | (411 | ) |
| $ | (550 | ) |
| $ | (337 | ) |
Foreign currency translation adjustments(1) |
| (138 | ) |
|
| 180 |
|
|
| (189 | ) |
|
| (30 | ) | |||||||||||||||
Foreign currency translation adjustments(1) |
| (416 | ) |
|
| 23 |
|
|
| (541 | ) |
|
| (51 | ) | |||||||||||||||
Ending balance | $ | (526 | ) |
| $ | (601 | ) |
| $ | (526 | ) |
| $ | (601 | ) | $ | (1,091 | ) |
| $ | (388 | ) |
| $ | (1,091 | ) |
| $ | (388 | ) |
(1) | Amounts for the three months ended |
20. Capital Stock
Share Repurchases. During the ninesix months ended SeptemberJune 30, 2021,2022, the Company repurchased 1.11.4 million common shares under the Company’s existing share repurchase program for approximately $900 million.$1 billion. At SeptemberJune 30, 2021,2022, there were 3.9approximately 2.2 million shares still authorized to be repurchased under the program.program
.
21. Income Taxes
Income tax expense for the ninesix months ended SeptemberJune 30, 2022 included $133 million of discrete tax benefits related to stock-based compensation awards and the resolution of certain outstanding tax matters. In addition, income tax expense for the six months ended June 30, 2022 included $18 million of net noncash tax benefits related to the revaluation of certain deferred income tax liabilities.
Income tax expense for the three and six months ended June 30, 2021 included $171 million of noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the UKUnited Kingdom increasing its corporate tax rate. Income tax expense for the ninesix months ended SeptemberJune 30, 2021 also reflected $42included $39 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, 2020 income tax expense also included the previously disclosed $54 million noncash net expense related to legislation enacted in the United Kingdom.
awards.
22. Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 under the treasury stock method:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions, except shares and per share data) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Net income attributable to BlackRock, Inc. | $ | 1,681 |
|
| $ | 1,364 |
|
| $ | 4,258 |
|
| $ | 3,384 |
| $ | 1,077 |
|
| $ | 1,378 |
|
| $ | 2,513 |
|
| $ | 2,577 |
|
Basic weighted-average shares outstanding |
| 152,120,927 |
|
|
| 152,488,073 |
|
|
| 152,375,504 |
|
|
| 153,816,544 |
|
| 151,292,580 |
|
|
| 152,443,039 |
|
|
| 151,511,496 |
|
|
| 152,504,902 |
|
Dilutive effect of: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonparticipating RSUs |
| 1,474,725 |
|
|
| 1,254,191 |
|
|
| 1,354,405 |
|
|
| 1,143,268 |
|
| 835,374 |
|
|
| 1,304,463 |
|
|
| 1,032,540 |
|
|
| 1,294,242 |
|
Stock options |
| 747,625 |
|
|
| — |
|
|
| 622,681 |
|
|
| — |
|
| 324,366 |
|
|
| 670,079 |
|
|
| 446,111 |
|
|
| 560,209 |
|
Total diluted weighted-average shares outstanding |
| 154,343,277 |
|
|
| 153,742,264 |
|
|
| 154,352,590 |
|
|
| 154,959,812 |
|
| 152,452,320 |
|
|
| 154,417,581 |
|
|
| 152,990,147 |
|
|
| 154,359,353 |
|
Basic earnings per share | $ | 11.05 |
|
| $ | 8.94 |
|
| $ | 27.94 |
|
| $ | 22.00 |
| $ | 7.12 |
|
| $ | 9.04 |
|
| $ | 16.59 |
|
| $ | 16.90 |
|
Diluted earnings per share | $ | 10.89 |
|
| $ | 8.87 |
|
| $ | 27.59 |
|
| $ | 21.84 |
| $ | 7.06 |
|
| $ | 8.92 |
|
| $ | 16.43 |
|
| $ | 16.69 |
|
For the three and six months ended June 30, 2022, 560,841 and 492,045 RSUs, respectively, were excluded from the calculation of diluted EPS because to include them would have an anti-dilutive effect. The amount of anti-dilutive RSUs was immaterial for the three and ninesix months ended SeptemberJune 30, 2021 and 2020.2021. Certain performance-based RSUs were excluded from the diluted EPS calculation because the designated contingency was not met for the three and ninesix months ended SeptemberJune 30, 2022 and 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.
23. Segment Information
The Company’s management directs BlackRock’s operations as 1one business, the asset management business. The Company utilizes a consolidated approach to assess performance and allocate resources. As such, the Company operates in one1 business segment.
The following table illustrates total revenue for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 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 |
|
| Six Months Ended |
| ||||||||||||||||||||
(in millions) |
| September 30, |
|
| September 30, |
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
Revenue |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Americas |
| $ | 3,127 |
|
| $ | 2,631 |
|
| $ | 9,095 |
|
| $ | 7,581 |
|
| $ | 3,014 |
|
| $ | 3,158 |
|
| $ | 6,103 |
|
| $ | 5,968 |
|
Europe |
|
| 1,706 |
|
|
| 1,574 |
|
|
| 4,533 |
|
|
| 3,661 |
|
|
| 1,307 |
|
|
| 1,440 |
|
|
| 2,703 |
|
|
| 2,827 |
|
Asia-Pacific |
|
| 217 |
|
|
| 164 |
|
|
| 640 |
|
|
| 485 |
|
|
| 205 |
|
|
| 222 |
|
|
| 419 |
|
|
| 423 |
|
Total revenue |
| $ | 5,050 |
|
| $ | 4,369 |
|
| $ | 14,268 |
|
| $ | 11,727 |
|
| $ | 4,526 |
|
| $ | 4,820 |
|
| $ | 9,225 |
|
| $ | 9,218 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 SeptemberJune 30, 20212022 and December 31, 20202021 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, |
|
| June 30, |
|
| December 31, |
| ||||
Long-lived Assets |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Americas |
| $ | 14,623 |
|
| $ | 13,784 |
|
| $ | 14,828 |
|
| $ | 14,675 |
|
Europe |
|
| 1,344 |
|
|
| 1,360 |
|
|
| 1,324 |
|
|
| 1,341 |
|
Asia-Pacific |
|
| 96 |
|
|
| 88 |
|
|
| 94 |
|
|
| 97 |
|
Total long-lived assets |
| $ | 16,063 |
|
| $ | 15,232 |
|
| $ | 16,246 |
|
| $ | 16,113 |
|
Americas is primarily comprised of the United States, Latin America and Canada, while Europe is primarily comprised of the UK,United Kingdom, the Netherlands, Switzerland, France, Ireland and Luxembourg. Asia-Pacific is primarily comprised of Hong Kong, Australia, Japan and Singapore.
24. Subsequent Events
The Company conducted a review for subsequent events and determined that no subsequent events had occurred that would require accrual or additional disclosures.
Item 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 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; (3) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management (“AUM”); (4) the relative and absolute investment performance of BlackRock’s investment products; (5) BlackRock’s ability to develop new products and services that address client preferences; (6) the impact of increased competition; (7) the impact of future acquisitions or divestitures; (8) BlackRock’s ability to integrate acquired businesses successfully; (9) the unfavorable resolution of legal proceedings; (10) the extent and timing of any share repurchases; (11) the impact, extent and timing of technological changes and the adequacy of intellectual property, data, information and cyber securitycybersecurity protection; (12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; (13) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock; (14) changes in law and policy and uncertainty pending any such changes; (15) any failure to effectively manage conflicts of interest; (16) damage to BlackRock’s reputation; (17) geopolitical unrest, terrorist activities, civil unrest,or international hostilities, including the military conflict between Russia and Ukraine, and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (18) climate change-related risks to BlackRock's business, products, operations and clients; (19) the ability to attract and retain highly talented professionals; (19)(20) fluctuations in the carrying value of BlackRock’s economic investments; (20)(21) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products or transactions, which could affect the value proposition to clients and, generally, the tax position of the Company; (21)(22) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (22)(23) the failure by a key vendorthird-party providers of BlackRock to fulfill itstheir obligations to the Company; (23)(24) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (24)(25) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds (“ETF”) platform; (25)(26) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (26)(27) 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 $9.5$8.5 trillion of AUM at SeptemberJune 30, 2021.2022. With approximately 18,00018,900 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 technology services to institutional and retail clients worldwide.
BlackRock’s diverse platform of alpha-seeking active, index and 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, ETFs, separate accounts, collective trust funds and other pooled investment vehicles. BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin,®, Aladdin Wealth, eFront, Cachematrix and FutureAdvisor,Cachematrix, as well as advisory services and solutions to a broad base of institutional and wealth management 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 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.
Certain prior period presentations and disclosures, while not required to be recast, were reclassified to ensure comparability with current period classifications.
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, andincluding existing and new variants of COVID-19, affectand its continued related impact on the global economy, affects 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 further duration of the pandemic and any recovery period, the emergence and spread of additional variants of the COVID-19 virus, the continuing prevalence of severe, unconstrained and/or escalating rates of infection in certain countries and regions, and the availability, adoption and efficacy of treatments and vaccines.vaccines and future actions taken by governmental authorities, central banks, and other third parties in response to the pandemic. See Part II,I, Item 1A - Risk Factors, of this filingthe Company’s Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the Securities and Exchange Commission on February 25, 2022 (“2021 Form 10-K”), for further information on the possible future impact of the COVID-19 pandemic on BlackRock’s business, results of operations and financial condition.
United Kingdom Exit from European Union
On December 31, 2020, the United Kingdom (“UK”) and the European Union (“EU”) reverted to being distinct regulatory, legal and customs territories. The 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 its European operations, particularly with regard to delegation and cross-border marketing of funds, which may impede the 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 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.
EXECUTIVE SUMMARY
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions, except shares and per share data) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
GAAP basis: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue | $ | 5,050 |
|
| $ | 4,369 |
|
| $ | 14,268 |
|
| $ | 11,727 |
| $ | 4,526 |
|
| $ | 4,820 |
|
| $ | 9,225 |
|
| $ | 9,218 |
|
Total expense |
| 3,115 |
|
|
| 2,612 |
|
|
| 8,857 |
|
|
| 7,880 |
|
| 2,858 |
|
|
| 2,889 |
|
|
| 5,793 |
|
|
| 5,742 |
|
Operating income | $ | 1,935 |
|
| $ | 1,757 |
|
| $ | 5,411 |
|
| $ | 3,847 |
| $ | 1,668 |
|
| $ | 1,931 |
|
| $ | 3,432 |
|
| $ | 3,476 |
|
Operating margin |
| 38.3 | % |
|
| 40.2 | % |
|
| 37.9 | % |
|
| 32.8 | % |
| 36.9 | % |
|
| 40.1 | % |
|
| 37.2 | % |
|
| 37.7 | % |
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests |
| 264 |
|
|
| 71 |
|
|
| 337 |
|
|
| 348 |
|
| (233 | ) |
|
| 101 |
|
|
| (298 | ) |
|
| 73 |
|
Income tax expense |
| (518 | ) |
|
| (464 | ) |
|
| (1,490 | ) |
|
| (811 | ) |
| 358 |
|
|
| 654 |
|
|
| 621 |
|
|
| 972 |
|
Net income attributable to BlackRock | $ | 1,681 |
|
| $ | 1,364 |
|
| $ | 4,258 |
|
| $ | 3,384 |
| $ | 1,077 |
|
| $ | 1,378 |
|
| $ | 2,513 |
|
| $ | 2,577 |
|
Diluted earnings per common share | $ | 10.89 |
|
| $ | 8.87 |
|
| $ | 27.59 |
|
| $ | 21.84 |
| $ | 7.06 |
|
| $ | 8.92 |
|
| $ | 16.43 |
|
| $ | 16.69 |
|
Effective tax rate |
| 23.6 | % |
|
| 25.4 | % |
|
| 25.9 | % |
|
| 19.3 | % |
| 24.9 | % |
|
| 32.2 | % |
|
| 19.8 | % |
|
| 27.4 | % |
As adjusted(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income | $ | 1,946 |
|
| $ | 1,757 |
|
| $ | 5,422 |
|
| $ | 4,436 |
| $ | 1,727 |
|
| $ | 2,016 |
|
| $ | 3,549 |
|
| $ | 3,615 |
|
Operating margin |
| 45.8 | % |
|
| 47.0 | % |
|
| 45.1 | % |
|
| 44.3 | % |
| 43.7 | % |
|
| 46.9 | % |
|
| 43.9 | % |
|
| 46.4 | % |
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests | $ | 264 |
|
| $ | 71 |
|
| $ | 337 |
|
| $ | 226 |
| $ | (233 | ) |
| $ | 101 |
|
| $ | (298 | ) |
| $ | 73 |
|
Net income attributable to BlackRock | $ | 1,690 |
|
| $ | 1,418 |
|
| $ | 4,438 |
|
| $ | 3,664 |
| $ | 1,122 |
|
| $ | 1,614 |
|
| $ | 2,584 |
|
| $ | 2,854 |
|
Diluted earnings per common share | $ | 10.95 |
|
| $ | 9.22 |
|
| $ | 28.75 |
|
| $ | 23.64 |
| $ | 7.36 |
|
| $ | 10.45 |
|
| $ | 16.89 |
|
| $ | 18.49 |
|
Effective tax rate |
| 23.6 | % |
|
| 22.5 | % |
|
| 22.9 | % |
|
| 21.4 | % |
| 24.9 | % |
|
| 23.8 | % |
|
| 20.5 | % |
|
| 22.6 | % |
Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUM (end of period) | $ | 9,463,662 |
|
| $ | 7,808,497 |
|
| $ | 9,463,662 |
|
| $ | 7,808,497 |
| |||||||||||||||
Assets under management (end of period) | $ | 8,487,410 |
|
| $ | 9,495,993 |
|
| $ | 8,487,410 |
|
| $ | 9,495,993 |
| |||||||||||||||
Diluted weighted-average common shares outstanding |
| 154,343,277 |
|
|
| 153,742,264 |
|
|
| 154,352,590 |
|
|
| 154,959,812 |
|
| 152,452,320 |
|
|
| 154,417,581 |
|
|
| 152,990,147 |
|
|
| 154,359,353 |
|
Shares outstanding (end of period) |
| 151,988,234 |
|
|
| 152,496,403 |
|
|
| 151,988,234 |
|
|
| 152,496,403 |
|
| 150,966,457 |
|
|
| 152,298,784 |
|
|
| 150,966,457 |
|
|
| 152,298,784 |
|
Book value per share(2) | $ | 242.24 |
|
| $ | 222.12 |
|
| $ | 242.24 |
|
| $ | 222.12 |
| $ | 245.68 |
|
| $ | 236.59 |
|
| $ | 245.68 |
|
| $ | 236.59 |
|
Cash dividends declared and paid per share | $ | 4.13 |
|
| $ | 3.63 |
|
| $ | 12.39 |
|
| $ | 10.89 |
| $ | 4.88 |
|
| $ | 4.13 |
|
| $ | 9.76 |
|
| $ | 8.26 |
|
|
(1) | As adjusted items are described in more detail in Non-GAAP Financial Measures. Beginning in the first quarter of 2022, BlackRock updated the definitions of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include new adjustments. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments. For further information, refer to the Current Report on Form 8-K furnished on April 13, 2022. |
(2) | Total BlackRock stockholders’ equity divided by total shares outstanding at |
THREE MONTHS ENDED SEPTEMBERJUNE 30, 20212022 COMPARED WITH THREE MONTHS ENDED SEPTEMBERJUNE 30, 20202021
GAAP. Operating income of $1,935$1,668 million increased $178decreased $263 million and operating margin of 38.3%36.9% decreased 190320 bps from the thirdsecond quarter of 2020. Operating2021. Decreases in operating income and operating margin reflectedwere driven by the impact of significantly lower markets, the negative impact of foreign exchange movements and lower performance fees, partially offset by organic base fee growth, the elimination of yield-related fee waivers on money market gains as well as strong organic growth andfunds, higher technology services revenue offset byand lower performance fees and higher expense, driven by higher general and 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).
expense. Nonoperating income (expense) less net income (loss) attributable to noncontrolling interests (“NCI”) increased $193decreased $334 million from the thirdsecond quarter of 2020,2021, driven primarily driven by non-cash gains related to our strategic minority investments in iCapital Network, Inc. (“iCapital”) and Scalable Capital Limited (“Scalable”) and higher mark-to-market gainslosses on the Company’s private equityun-hedged seed capital, co-investment portfolio.portfolios and certain minority investments.
Earnings per diluted common share increased $2.02,decreased $1.86, or 23%21%, from the thirdsecond quarter of 2020,2021, primarily reflecting higherlower operating and nonoperating income, andpartially offset by a lower effective tax rate in the current quarter.
As Adjusted. Operating income of $1,946 million increased $189 million and operating margin of 45.8% decreased 120 bps from the thirdquarter. Second quarter 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. Income2021 income tax expense as adjusted, for the third quarter of 2020 excluded a $54 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.
NINE MONTHS ENDED SEPTEMBER 30, 2021 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2020
GAAP.Operating income of $5,411 million increased $1,564 million and operating margin of 37.9% increased 510 bps from the nine months ended September 30, 2020. Increases in operating income and operating margin reflected the impact of $589 million related to the previously reported charitable contribution of BlackRock’s remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”) during the nine months ended September 30, 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 2021.
Nonoperating income (expense) less net income (loss) attributable to NCI decreased $11 million from the nine months ended September 30, 2020, reflecting the impact of a pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital and $122 million pre-tax gain related to the Charitable Contribution during the nine months ended September 30, 2020, partially offset by the impact of non-cash gains related to iCapital and Scalable and higher mark-to-market gains on the Company’s private equity co-investment portfolio during the nine months ended September 30, 2021.
Income tax expense for the nine months ended September 30, 2021 reflected theincluded $171 million of noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the UK increasing its corporate tax rate. See Income Tax Expense within Discussion of Financial Results for more information.
As Adjusted.Operating income of $1,727 million decreased $289 million and operating margin of 43.7% decreased 320 bps from the second quarter of 2021. Earnings per diluted common share decreased $3.09, or 30%, from the second quarter of 2021. Income tax expense, as adjusted, for the second quarter 2021 excluded $171 million of noncash net expense described above.
SIX MONTHS ENDED JUNE 30, 2022 COMPARED WITH SIX MONTHS ENDED JUNE 30, 2021
GAAP.Operating income of $3,432 million decreased $44 million and operating margin of 37.2% decreased 50 bps from the six months ended June 30, 2021. Decreases in operating income and operating margin reflected lower performance fees and higher volume related expense, partially offset by higher investment advisory and administration fees (collectively “base fees”), higher technology services revenue, lower employee compensation and benefits expense and lower general and administration expense, including the impact of $178 million of product launch costs incurred in 2021.
Nonoperating income (expense) less net income (loss) attributable to NCI decreased $371 million from the six months ended June 30, 2021, driven primarily by mark-to-market losses on the Company’s un-hedged seed capital, co-investment portfolios and certain minority investments during the six months ended June 30, 2022.
Income tax expense for the ninesix months ended SeptemberJune 30, 2020 included a discrete tax benefit of $2412022 reflected $133 million recognized in connection with the Charitable Contribution and a $54 million noncash net expense related to the revaluation of 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 2022 and the first quarterresolution of each year.certain outstanding tax matters, and $18 million of net noncash tax benefits related to the revaluation of certain deferred income tax liabilities. Income tax expense for the six months ended June 30, 2021 included $171 million of noncash net expense described above and $39 million of discrete tax benefits related to stock-based compensation awards that vested in 2021. See Income Tax Expense within Discussion of Financial Results for more information.
Earnings per diluted common share increased $5.75,decreased $0.26 or 26%2%, from the ninesix months ended SeptemberJune 30, 2020,2021, 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 nine months ended September 30, 2021.
As Adjusted. Operating income of $5,422 million 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 higherlower effective tax rate inrate.
As Adjusted. Operating income of $3,549 million decreased $66 million and operating margin of 43.9% decreased 250 bps from the ninesix months ended SeptemberJune 30, 2021.Income tax expense for the nine months ended September 30, 2021 and 2020 excluded the $171 million and $54 million, respectively, The impact of noncash net expense described above. The financial impact related to the Lease cost – Hudson Yards and the Charitable Contributionproduct launch costs has been excluded from as adjusted resultsoperating margin for the ninesix months ended SeptemberJune 30, 2021.
Earnings per diluted common share decreased $1.60, or 9%, from the six months ended June 30, 2021, primarily driven by lower nonoperating income in the six months ended June 30, 2022.Income tax expense for the six months ended June 30, 2022 and 2020, respectively.2021 excluded the $18 million net noncash benefit and the $171 million net noncash expense, respectively, described above.
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”). Beginning in the first quarter of 2022, BlackRock updated the definitions of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include new adjustments. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments. For further information, refer to the Current Report on Form 8-K furnished on April 13, 2022.
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. 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. Management reviews non-GAAP financial measures, in addition to 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 GAAPBeginning in the first quarter of 2022, the Company updated its definition of operating income, as adjusted, operating margin, as adjusted, and non-GAAP financialnet income attributable to BlackRock, Inc., as adjusted, to include adjustments related to amortization of intangible assets, other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation, and contingent consideration fair value adjustments incurred in connection with certain acquisitions. Such measures in evaluating BlackRock’s financial performance. Adjustmentshave been recast for 2021 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.reflect the inclusion of such new adjustments. For further information, refer to the Current Report on Form 8-K furnished on April 13, 2022.
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:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Operating income, GAAP basis | $ | 1,935 |
|
| $ | 1,757 |
|
| $ | 5,411 |
|
| $ | 3,847 |
| $ | 1,668 |
|
| $ | 1,931 |
|
| $ | 3,432 |
|
| $ | 3,476 |
|
Non-GAAP expense adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Lease costs - Hudson Yards |
| 11 |
|
|
| — |
|
|
| 11 |
|
|
| — |
| |||||||||||||||
Charitable Contribution |
| — |
|
|
| — |
|
|
| — |
|
|
| 589 |
| |||||||||||||||
Non-GAAP expense adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Amortization of intangible assets |
| 38 |
|
| 37 |
|
| 76 |
|
| 71 |
| ||||||||||||||||||
Acquisition-related compensation costs |
| 6 |
|
| 47 |
|
| 13 |
|
| 64 |
| ||||||||||||||||||
Contingent consideration fair value adjustments |
| — |
|
| 1 |
|
| 1 |
|
| 4 |
| ||||||||||||||||||
Lease cost - Hudson Yards |
| 15 |
|
|
| — |
|
|
| 27 |
|
|
| — |
| |||||||||||||||
Operating income, as adjusted |
| 1,946 |
|
|
| 1,757 |
|
|
| 5,422 |
|
|
| 4,436 |
|
| 1,727 |
|
|
| 2,016 |
|
|
| 3,549 |
|
|
| 3,615 |
|
Product launch costs and commissions |
| 99 |
|
|
| 83 |
|
|
| 284 |
|
|
| 170 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 185 |
|
Operating income used for operating margin measurement | $ | 2,045 |
|
| $ | 1,840 |
|
| $ | 5,706 |
|
| $ | 4,606 |
| $ | 1,727 |
|
| $ | 2,016 |
|
| $ | 3,549 |
|
| $ | 3,800 |
|
Revenue, GAAP basis | $ | 5,050 |
|
| $ | 4,369 |
|
| $ | 14,268 |
|
| $ | 11,727 |
| $ | 4,526 |
|
| $ | 4,820 |
|
| $ | 9,225 |
|
| $ | 9,218 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distribution fees |
| (401 | ) |
|
| (288 | ) |
|
| (1,110 | ) |
|
| (817 | ) |
| (361 | ) |
|
| (369 | ) |
|
| (742 | ) |
|
| (709 | ) |
Investment advisory fees |
| (184 | ) |
|
| (168 | ) |
|
| (503 | ) |
|
| (513 | ) |
| (211 | ) |
|
| (154 | ) |
|
| (404 | ) |
|
| (319 | ) |
Revenue used for operating margin measurement | $ | 4,465 |
|
| $ | 3,913 |
|
| $ | 12,655 |
|
| $ | 10,397 |
| $ | 3,954 |
|
| $ | 4,297 |
|
| $ | 8,079 |
|
| $ | 8,190 |
|
Operating margin, GAAP basis |
| 38.3 | % |
|
| 40.2 | % |
|
| 37.9 | % |
|
| 32.8 | % |
| 36.9 | % |
|
| 40.1 | % |
|
| 37.2 | % |
|
| 37.7 | % |
Operating margin, as adjusted |
| 45.8 | % |
|
| 47.0 | % |
|
| 45.1 | % |
|
| 44.3 | % |
| 43.7 | % |
|
| 46.9 | % |
|
| 43.9 | % |
|
| 46.4 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 usedemployees and to evaluate the Company’s relative performance against industry peers, as itpeers. Furthermore, this metric 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. |
| • | 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) | 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 |
|
Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of this information among reporting periods. Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure, for both management and investors, of BlackRock’s nonoperating results, which ultimately impact BlackRock’s book value. During the nine months ended September 30, 2020, the noncash, nonoperating pre-tax gain of $122 million related to the Charitable Contribution has been excluded from nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, due to its nonrecurring nature.
(3)(2) Net income attributable to BlackRock, Inc., as adjusted:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions, except per share data) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Net income attributable to BlackRock, Inc., GAAP basis | $ | 1,681 |
|
| $ | 1,364 |
|
| $ | 4,258 |
|
| $ | 3,384 |
| $ | 1,077 |
|
| $ | 1,378 |
|
| $ | 2,513 |
|
| $ | 2,577 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease costs - Hudson Yards, net of tax |
| 9 |
|
|
| — |
|
|
| 9 |
|
|
| — |
| |||||||||||||||
Charitable Contribution, net of tax |
| — |
|
|
| — |
|
|
| — |
|
|
| 226 |
| |||||||||||||||
Amortization of intangible assets, net of tax |
| 29 |
|
| 28 |
|
|
| 58 |
|
| 54 |
| |||||||||||||||||
Acquisition-related compensation costs, net of tax |
| 5 |
|
| 36 |
|
|
| 10 |
|
| 49 |
| |||||||||||||||||
Contingent consideration fair value adjustments, net of tax |
| — |
|
|
| 1 |
|
|
| 1 |
|
| 3 |
| ||||||||||||||||
Lease cost - Hudson Yards, net of tax |
| 11 |
|
|
| — |
|
|
| 20 |
|
|
| — |
| |||||||||||||||
Income tax matters |
| — |
|
|
| 54 |
|
|
| 171 |
|
|
| 54 |
|
| — |
|
|
| 171 |
|
|
| (18 | ) |
|
| 171 |
|
Net income attributable to BlackRock, Inc., as adjusted | $ | 1,690 |
|
| $ | 1,418 |
|
| $ | 4,438 |
|
| $ | 3,664 |
| $ | 1,122 |
|
| $ | 1,614 |
|
| $ | 2,584 |
|
| $ | 2,854 |
|
Diluted weighted-average common shares outstanding |
| 154.3 |
|
|
| 153.7 |
|
|
| 154.4 |
|
|
| 155.0 |
|
| 152.5 |
|
|
| 154.4 |
|
|
| 153.0 |
|
|
| 154.4 |
|
Diluted earnings per common share, GAAP basis | $ | 10.89 |
|
| $ | 8.87 |
|
| $ | 27.59 |
|
| $ | 21.84 |
| $ | 7.06 |
|
| $ | 8.92 |
|
| $ | 16.43 |
|
| $ | 16.69 |
|
Diluted earnings per common share, as adjusted | $ | 10.95 |
|
| $ | 9.22 |
|
| $ | 28.75 |
|
| $ | 23.64 |
| $ | 7.36 |
|
| $ | 10.45 |
|
| $ | 16.89 |
|
| $ | 18.49 |
|
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 discussionnote (1) above 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 updated presentation of non-GAAP expense adjustments related to amortization of intangible assets, other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation, and contingent consideration fair value adjustments incurred in connection with certain acquisitions, as well as previously reported 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 Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the nonrecurring nature of the Charitable Contribution. Amounts for income tax matters represent net noncash (benefits) expense primarily associated with the revaluation of certain deferred tax liabilities related to intangible assets and goodwill as a result of tax rate changes. These amounts have been excluded from the as adjusted results as these items will not have a cash flow impact and to ensure comparability among periods presented.Yards.
Per share amounts reflect net income attributable to BlackRock, Inc., as adjusted divided by diluted weighted-average common shares outstanding.
ASSETS UNDER MANAGEMENT
AUM for reporting purposes generally is based upon how baseinvestment advisory and administration 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 and Product 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 |
| ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ended |
|
| Ended |
|
| Ended |
| AUM |
|
| Net inflows (outflows) |
| |||||||||||||||||||||||||
| September 30, |
|
| June 30, |
|
| December 31, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
| June 30, |
|
| March 31, |
|
| December 31, |
|
| June 30, |
|
| Three Months Ended June 30, |
|
| Six Months Ended June 30, |
|
| Twelve Months Ended June 30, |
| ||||||||||||||
(in millions) | 2021 |
|
| 2021 |
|
| 2020 |
|
| 2020 |
|
| 2021 |
|
| 2021 |
|
| 2021 |
| 2022 |
|
| 2022 |
|
| 2021 |
|
| 2021 |
|
| 2022 |
|
| 2022 |
|
| 2022 |
| ||||||||||||||
Retail | $ | 1,000,627 |
|
| $ | 995,483 |
|
| $ | 845,917 |
|
| $ | 746,264 |
|
| $ | 22,672 |
|
| $ | 80,572 |
|
| $ | 115,889 |
| $ | 863,425 |
|
| $ | 989,123 |
|
| $ | 1,040,053 |
|
| $ | 995,483 |
|
| $ | (9,973 | ) |
| $ | 191 |
|
| $ | 44,386 |
|
ETFs |
| 3,038,751 |
|
|
| 3,031,505 |
|
|
| 2,669,007 |
|
|
| 2,321,335 |
|
|
| 57,954 |
|
|
| 201,591 |
|
|
| 280,344 |
|
| 2,784,296 |
|
|
| 3,150,496 |
|
|
| 3,267,354 |
|
|
| 3,031,505 |
|
|
| 52,103 |
|
|
| 108,312 |
|
|
| 270,209 |
|
Institutional: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 1,638,545 |
|
|
| 1,624,049 |
|
|
| 1,524,462 |
|
|
| 1,427,122 |
|
|
| 25,558 |
|
|
| 85,558 |
|
|
| 86,913 |
|
| 1,510,862 |
|
|
| 1,676,167 |
|
|
| 1,756,717 |
|
|
| 1,624,049 |
|
|
| 5,275 |
|
|
| 21,673 |
|
|
| 130,738 |
|
Index |
| 3,063,692 |
|
|
| 3,097,073 |
|
|
| 2,948,683 |
|
|
| 2,641,408 |
|
|
| (8,212 | ) |
|
| (77,405 | ) |
|
| (76,633 | ) |
| 2,580,603 |
|
|
| 3,019,764 |
|
|
| 3,181,652 |
|
|
| 3,097,073 |
|
|
| 21,208 |
|
|
| 52,182 |
|
|
| 3,549 |
|
Institutional subtotal |
| 4,702,237 |
|
|
| 4,721,122 |
|
|
| 4,473,145 |
|
|
| 4,068,530 |
|
|
| 17,346 |
|
|
| 8,153 |
|
|
| 10,280 |
|
| 4,091,465 |
|
|
| 4,695,931 |
|
|
| 4,938,369 |
|
|
| 4,721,122 |
|
|
| 26,483 |
|
|
| 73,855 |
|
|
| 134,287 |
|
Long-term |
| 8,741,615 |
|
|
| 8,748,110 |
|
|
| 7,988,069 |
|
|
| 7,136,129 |
|
|
| 97,972 |
|
|
| 290,316 |
|
|
| 406,513 |
|
| 7,739,186 |
|
|
| 8,835,550 |
|
|
| 9,245,776 |
|
|
| 8,748,110 |
|
|
| 68,613 |
|
|
| 182,358 |
|
|
| 448,882 |
|
Cash management |
| 712,015 |
|
|
| 727,603 |
|
|
| 666,252 |
|
|
| 652,002 |
|
|
| (12,398 | ) |
|
| 50,132 |
|
|
| 59,076 |
|
| 739,457 |
|
|
| 724,939 |
|
|
| 755,057 |
|
|
| 727,603 |
|
|
| 21,218 |
|
|
| (5,876 | ) |
|
| 25,638 |
|
Advisory(1) |
| 10,032 |
|
|
| 20,280 |
|
|
| 22,359 |
|
|
| 20,366 |
|
|
| (10,260 | ) |
|
| (12,530 | ) |
|
| (10,738 | ) |
| 8,767 |
|
|
| 9,025 |
|
|
| 9,310 |
|
|
| 20,280 |
|
|
| (258 | ) |
|
| (543 | ) |
|
| (11,530 | ) |
Total | $ | 9,463,662 |
|
| $ | 9,495,993 |
|
| $ | 8,676,680 |
|
| $ | 7,808,497 |
|
| $ | 75,314 |
|
| $ | 327,918 |
|
| $ | 454,851 |
| $ | 8,487,410 |
|
| $ | 9,569,514 |
|
| $ | 10,010,143 |
|
| $ | 9,495,993 |
|
| $ | 89,573 |
|
| $ | 175,939 |
|
| $ | 462,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUM and Net Inflows (Outflows) by Investment Style and Product Type | 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) |
| AUM |
|
| Net inflows (outflows) |
| ||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months |
|
| Nine Months |
|
| Twelve Months |
| June 30, |
|
| March 31, |
|
| December 31, |
|
| June 30, |
|
| Three Months Ended June 30, |
|
| Six Months Ended June 30, |
|
| Twelve Months Ended June 30, |
| ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 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 |
| 2022 |
|
| 2022 |
|
| 2021 |
|
| 2021 |
|
| 2022 |
|
| 2022 |
|
| 2022 |
| ||||||||||||||
Active | $ | 2,463,867 |
|
| $ | 2,446,632 |
|
| $ | 2,250,887 |
|
| $ | 2,072,673 |
|
| $ | 44,528 |
|
| $ | 166,233 |
|
| $ | 197,293 |
| $ | 2,210,648 |
|
| $ | 2,479,140 |
|
| $ | 2,606,325 |
|
| $ | 2,446,632 |
|
| $ | (10,339 | ) |
| $ | 9,699 |
|
| $ | 154,734 |
|
Index and ETFs |
| 6,277,748 |
|
|
| 6,301,478 |
|
|
| 5,737,182 |
|
|
| 5,063,456 |
|
|
| 53,444 |
|
|
| 124,083 |
|
|
| 209,220 |
|
| 5,528,538 |
|
|
| 6,356,410 |
|
|
| 6,639,451 |
|
|
| 6,301,478 |
|
|
| 78,952 |
|
|
| 172,659 |
|
|
| 294,148 |
|
Long-term |
| 8,741,615 |
|
|
| 8,748,110 |
|
|
| 7,988,069 |
|
|
| 7,136,129 |
|
|
| 97,972 |
|
|
| 290,316 |
|
|
| 406,513 |
|
| 7,739,186 |
|
|
| 8,835,550 |
|
|
| 9,245,776 |
|
|
| 8,748,110 |
|
|
| 68,613 |
|
|
| 182,358 |
|
|
| 448,882 |
|
Cash management |
| 712,015 |
|
|
| 727,603 |
|
|
| 666,252 |
|
|
| 652,002 |
|
|
| (12,398 | ) |
|
| 50,132 |
|
|
| 59,076 |
|
| 739,457 |
|
|
| 724,939 |
|
|
| 755,057 |
|
|
| 727,603 |
|
|
| 21,218 |
|
|
| (5,876 | ) |
|
| 25,638 |
|
Advisory(1) |
| 10,032 |
|
|
| 20,280 |
|
|
| 22,359 |
|
|
| 20,366 |
|
|
| (10,260 | ) |
|
| (12,530 | ) |
|
| (10,738 | ) |
| 8,767 |
|
|
| 9,025 |
|
|
| 9,310 |
|
|
| 20,280 |
|
|
| (258 | ) |
|
| (543 | ) |
|
| (11,530 | ) |
Total | $ | 9,463,662 |
|
| $ | 9,495,993 |
|
| $ | 8,676,680 |
|
| $ | 7,808,497 |
|
| $ | 75,314 |
|
| $ | 327,918 |
|
| $ | 454,851 |
| $ | 8,487,410 |
|
| $ | 9,569,514 |
|
| $ | 10,010,143 |
|
| $ | 9,495,993 |
|
| $ | 89,573 |
|
| $ | 175,939 |
|
| $ | 462,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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) |
| |||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months |
|
| Nine Months |
|
| Twelve Months |
| ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Ended |
|
| Ended |
|
| Ended |
| AUM |
|
| Net inflows (outflows) |
| |||||||||||||||||||||||||
| September 30, |
|
| June 30, |
|
| December 31, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
| June 30, |
|
| March 31, |
|
| December 31, |
|
| June 30, |
|
| Three Months Ended June 30, |
|
| Six Months Ended June 30, |
|
| Twelve Months Ended June 30, |
| ||||||||||||||
(in millions) | 2021 |
|
| 2021 |
|
| 2020 |
|
| 2020 |
|
| 2021 |
|
| 2021 |
|
| 2021 |
| 2022 |
|
| 2022 |
|
| 2021 |
|
| 2021 |
|
| 2022 |
|
| 2022 |
|
| 2022 |
| ||||||||||||||
Equity | $ | 4,998,410 |
|
| $ | 5,034,391 |
|
| $ | 4,419,806 |
|
| $ | 3,784,118 |
|
| $ | 33,168 |
|
| $ | 56,576 |
|
| $ | 104,653 |
| $ | 4,345,120 |
|
| $ | 5,119,044 |
|
| $ | 5,342,360 |
|
| $ | 5,034,391 |
|
| $ | 28,642 |
|
| $ | 104,666 |
|
| $ | 182,940 |
|
Fixed income |
| 2,713,899 |
|
|
| 2,712,165 |
|
|
| 2,674,488 |
|
|
| 2,531,465 |
|
|
| 27,315 |
|
|
| 129,445 |
|
|
| 192,149 |
|
| 2,439,844 |
|
|
| 2,645,871 |
|
|
| 2,822,041 |
|
|
| 2,712,165 |
|
|
| 36,126 |
|
|
| 43,649 |
|
|
| 171,856 |
|
Multi-asset |
| 773,158 |
|
|
| 748,770 |
|
|
| 658,733 |
|
|
| 598,246 |
|
|
| 30,935 |
|
|
| 80,824 |
|
|
| 80,422 |
|
| 678,465 |
|
|
| 785,182 |
|
|
| 816,494 |
|
|
| 748,770 |
|
|
| 1,380 |
|
|
| 19,052 |
|
|
| 66,994 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 98,321 |
|
|
| 95,961 |
|
|
| 85,770 |
|
|
| 79,723 |
|
|
| 2,743 |
|
|
| 12,315 |
|
|
| 16,844 |
|
| 112,039 |
|
|
| 109,141 |
|
|
| 102,579 |
|
|
| 95,961 |
|
|
| 5,414 |
|
|
| 9,286 |
|
|
| 15,835 |
|
Liquid alternatives |
| 85,052 |
|
|
| 81,560 |
|
|
| 73,218 |
|
|
| 69,255 |
|
|
| 3,782 |
|
|
| 9,455 |
|
|
| 10,492 |
|
| 83,770 |
|
|
| 87,326 |
|
|
| 87,348 |
|
|
| 81,560 |
|
|
| (932 | ) |
|
| 976 |
|
|
| 6,629 |
|
Currency and commodities(2) |
| 72,775 |
|
|
| 75,263 |
|
|
| 76,054 |
|
|
| 73,322 |
|
|
| 29 |
|
|
| 1,701 |
|
|
| 1,953 |
|
| 79,948 |
|
|
| 88,986 |
|
|
| 74,954 |
|
|
| 75,263 |
|
|
| (2,017 | ) |
|
| 4,729 |
|
|
| 4,628 |
|
Alternatives subtotal |
| 256,148 |
|
|
| 252,784 |
|
|
| 235,042 |
|
|
| 222,300 |
|
|
| 6,554 |
|
|
| 23,471 |
|
|
| 29,289 |
|
| 275,757 |
|
|
| 285,453 |
|
|
| 264,881 |
|
|
| 252,784 |
|
|
| 2,465 |
|
|
| 14,991 |
|
|
| 27,092 |
|
Long-term |
| 8,741,615 |
|
|
| 8,748,110 |
|
|
| 7,988,069 |
|
|
| 7,136,129 |
|
|
| 97,972 |
|
|
| 290,316 |
|
|
| 406,513 |
|
| 7,739,186 |
|
|
| 8,835,550 |
|
|
| 9,245,776 |
|
|
| 8,748,110 |
|
|
| 68,613 |
|
|
| 182,358 |
|
|
| 448,882 |
|
Cash management |
| 712,015 |
|
|
| 727,603 |
|
|
| 666,252 |
|
|
| 652,002 |
|
|
| (12,398 | ) |
|
| 50,132 |
|
|
| 59,076 |
|
| 739,457 |
|
|
| 724,939 |
|
|
| 755,057 |
|
|
| 727,603 |
|
|
| 21,218 |
|
|
| (5,876 | ) |
|
| 25,638 |
|
Advisory |
| 10,032 |
|
|
| 20,280 |
|
|
| 22,359 |
|
|
| 20,366 |
|
|
| (10,260 | ) |
|
| (12,530 | ) |
|
| (10,738 | ) | |||||||||||||||||||||||||||
Advisory(1) |
| 8,767 |
|
|
| 9,025 |
|
|
| 9,310 |
|
|
| 20,280 |
|
|
| (258 | ) |
|
| (543 | ) |
|
| (11,530 | ) | |||||||||||||||||||||||||||
Total | $ | 9,463,662 |
|
| $ | 9,495,993 |
|
| $ | 8,676,680 |
|
| $ | 7,808,497 |
|
| $ | 75,314 |
|
| $ | 327,918 |
|
| $ | 454,851 |
| $ | 8,487,410 |
|
| $ | 9,569,514 |
|
| $ | 10,010,143 |
|
| $ | 9,495,993 |
|
| $ | 89,573 |
|
| $ | 175,939 |
|
| $ | 462,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 ETFs. |
Component Changes in AUM for the Three Months Ended SeptemberJune 30, 20212022
The following table presents the component changes in AUM by client type and product type for the three months ended SeptemberJune 30, 2021.2022.
|
|
|
|
| Net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||
| June 30, |
|
| inflows |
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| March 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2021 |
|
| AUM(2) |
| 2022 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| ||||||||||||
Retail: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 446,327 |
|
| $ | 9,952 |
|
| $ | (7,823 | ) |
| $ | (2,719 | ) |
| $ | 445,737 |
|
| $ | 452,433 |
| $ | 446,043 |
|
| $ | (872 | ) |
| $ | (66,388 | ) |
| $ | (7,557 | ) |
| $ | 371,226 |
|
| $ | 409,171 |
|
Fixed income |
| 359,480 |
|
|
| 4,524 |
|
|
| (3,156 | ) |
|
| (1,687 | ) |
|
| 359,161 |
|
|
| 361,730 |
|
| 343,712 |
|
|
| (7,563 | ) |
|
| (18,397 | ) |
|
| (3,892 | ) |
|
| 313,860 |
|
|
| 328,816 |
|
Multi-asset |
| 147,228 |
|
|
| 5,395 |
|
|
| (1,332 | ) |
|
| (338 | ) |
|
| 150,953 |
|
|
| 150,409 |
|
| 149,480 |
|
|
| (3,000 | ) |
|
| (16,394 | ) |
|
| (944 | ) |
|
| 129,142 |
|
|
| 139,662 |
|
Alternatives |
| 42,448 |
|
|
| 2,801 |
|
|
| (318 | ) |
|
| (155 | ) |
|
| 44,776 |
|
|
| 43,690 |
|
| 49,888 |
|
|
| 1,462 |
|
|
| (1,681 | ) |
|
| (472 | ) |
|
| 49,197 |
|
|
| 49,900 |
|
Retail subtotal |
| 995,483 |
|
|
| 22,672 |
|
|
| (12,629 | ) |
|
| (4,899 | ) |
|
| 1,000,627 |
|
|
| 1,008,262 |
|
| 989,123 |
|
|
| (9,973 | ) |
|
| (102,860 | ) |
|
| (12,865 | ) |
|
| 863,425 |
|
|
| 927,549 |
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,257,828 |
|
|
| 34,987 |
|
|
| (36,247 | ) |
|
| (5,719 | ) |
|
| 2,250,849 |
|
|
| 2,279,480 |
|
| 2,350,421 |
|
|
| 23,328 |
|
|
| (348,798 | ) |
|
| (14,608 | ) |
|
| 2,010,343 |
|
|
| 2,178,149 |
|
Fixed income |
| 700,009 |
|
|
| 22,489 |
|
|
| (3,494 | ) |
|
| (2,408 | ) |
|
| 716,596 |
|
|
| 711,729 |
|
| 712,767 |
|
|
| 30,739 |
|
|
| (41,926 | ) |
|
| (5,692 | ) |
|
| 695,888 |
|
|
| 702,485 |
|
Multi-asset |
| 7,663 |
|
|
| 593 |
|
|
| (70 | ) |
|
| (36 | ) |
|
| 8,150 |
|
|
| 7,954 |
|
| 8,716 |
|
|
| 161 |
|
|
| (942 | ) |
|
| (67 | ) |
|
| 7,868 |
|
|
| 8,246 |
|
Alternatives |
| 66,005 |
|
|
| (115 | ) |
|
| (2,688 | ) |
|
| (46 | ) |
|
| 63,156 |
|
|
| 65,863 |
|
| 78,592 |
|
|
| (2,125 | ) |
|
| (6,159 | ) |
|
| (111 | ) |
|
| 70,197 |
|
|
| 75,187 |
|
ETFs subtotal |
| 3,031,505 |
|
|
| 57,954 |
|
|
| (42,499 | ) |
|
| (8,209 | ) |
|
| 3,038,751 |
|
|
| 3,065,026 |
|
| 3,150,496 |
|
|
| 52,103 |
|
|
| (397,825 | ) |
|
| (20,478 | ) |
|
| 2,784,296 |
|
|
| 2,964,067 |
|
Institutional: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 184,174 |
|
|
| 1,930 |
|
|
| (2,410 | ) |
|
| (1,462 | ) |
|
| 182,232 |
|
|
| 185,208 |
|
| 188,822 |
|
|
| 3,885 |
|
|
| (23,962 | ) |
|
| (5,048 | ) |
|
| 163,697 |
|
|
| 176,618 |
|
Fixed income |
| 716,671 |
|
|
| (5,716 | ) |
|
| 806 |
|
|
| (3,063 | ) |
|
| 708,698 |
|
|
| 718,139 |
|
| 718,225 |
|
|
| (6,774 | ) |
|
| (40,123 | ) |
|
| (9,476 | ) |
|
| 661,852 |
|
|
| 687,561 |
|
Multi-asset |
| 584,582 |
|
|
| 25,477 |
|
|
| 920 |
|
|
| (5,682 | ) |
|
| 605,297 |
|
|
| 604,848 |
|
| 617,843 |
|
|
| 4,866 |
|
|
| (72,880 | ) |
|
| (15,670 | ) |
|
| 534,159 |
|
|
| 575,970 |
|
Alternatives |
| 138,622 |
|
|
| 3,867 |
|
|
| 560 |
|
|
| (731 | ) |
|
| 142,318 |
|
|
| 140,894 |
|
| 151,277 |
|
|
| 3,298 |
|
|
| (805 | ) |
|
| (2,616 | ) |
|
| 151,154 |
|
|
| 150,957 |
|
Active subtotal |
| 1,624,049 |
|
|
| 25,558 |
|
|
| (124 | ) |
|
| (10,938 | ) |
|
| 1,638,545 |
|
|
| 1,649,089 |
|
| 1,676,167 |
|
|
| 5,275 |
|
|
| (137,770 | ) |
|
| (32,810 | ) |
|
| 1,510,862 |
|
|
| 1,591,106 |
|
Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,146,062 |
|
|
| (13,701 | ) |
|
| (114 | ) |
|
| (12,655 | ) |
|
| 2,119,592 |
|
|
| 2,158,274 |
|
| 2,133,758 |
|
|
| 2,301 |
|
|
| (287,363 | ) |
|
| (48,842 | ) |
|
| 1,799,854 |
|
|
| 1,969,660 |
|
Fixed income |
| 936,005 |
|
|
| 6,018 |
|
|
| 139 |
|
|
| (12,718 | ) |
|
| 929,444 |
|
|
| 947,359 |
|
| 871,167 |
|
|
| 19,724 |
|
|
| (73,665 | ) |
|
| (48,982 | ) |
|
| 768,244 |
|
|
| 813,260 |
|
Multi-asset |
| 9,297 |
|
|
| (530 | ) |
|
| 19 |
|
|
| (28 | ) |
|
| 8,758 |
|
|
| 9,095 |
|
| 9,143 |
|
|
| (647 | ) |
|
| (937 | ) |
|
| (263 | ) |
|
| 7,296 |
|
|
| 7,863 |
|
Alternatives |
| 5,709 |
|
|
| 1 |
|
|
| 222 |
|
|
| (34 | ) |
|
| 5,898 |
|
|
| 5,796 |
|
| 5,696 |
|
|
| (170 | ) |
|
| (99 | ) |
|
| (218 | ) |
|
| 5,209 |
|
|
| 5,600 |
|
Index subtotal |
| 3,097,073 |
|
|
| (8,212 | ) |
|
| 266 |
|
|
| (25,435 | ) |
|
| 3,063,692 |
|
|
| 3,120,524 |
|
| 3,019,764 |
|
|
| 21,208 |
|
|
| (362,064 | ) |
|
| (98,305 | ) |
|
| 2,580,603 |
|
|
| 2,796,383 |
|
Institutional subtotal |
| 4,721,122 |
|
|
| 17,346 |
|
|
| 142 |
|
|
| (36,373 | ) |
|
| 4,702,237 |
|
|
| 4,769,613 |
|
| 4,695,931 |
|
|
| 26,483 |
|
|
| (499,834 | ) |
|
| (131,115 | ) |
|
| 4,091,465 |
|
|
| 4,387,489 |
|
Long-term |
| 8,748,110 |
|
|
| 97,972 |
|
|
| (54,986 | ) |
|
| (49,481 | ) |
|
| 8,741,615 |
|
|
| 8,842,901 |
|
| 8,835,550 |
|
|
| 68,613 |
|
|
| (1,000,519 | ) |
|
| (164,458 | ) |
|
| 7,739,186 |
|
|
| 8,279,105 |
|
Cash management |
| 727,603 |
|
|
| (12,398 | ) |
|
| (784 | ) |
|
| (2,406 | ) |
|
| 712,015 |
|
|
| 722,103 |
|
| 724,939 |
|
|
| 21,218 |
|
|
| (130 | ) |
|
| (6,570 | ) |
|
| 739,457 |
|
|
| 734,270 |
|
Advisory(3) |
| 20,280 |
|
|
| (10,260 | ) |
|
| 23 |
|
|
| (11 | ) |
|
| 10,032 |
|
|
| 13,749 |
|
| 9,025 |
|
|
| (258 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 8,903 |
|
Total | $ | 9,495,993 |
|
| $ | 75,314 |
|
| $ | (55,747 | ) |
| $ | (51,898 | ) |
| $ | 9,463,662 |
|
| $ | 9,578,753 |
| $ | 9,569,514 |
|
| $ | 89,573 |
|
| $ | (1,000,649 | ) |
| $ | (171,028 | ) |
| $ | 8,487,410 |
|
| $ | 9,022,278 |
|
(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. |
The following table presents the component changes in AUM by investment style and product type for the three months ended SeptemberJune 30, 2021.2022.
|
|
|
|
| Net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||
| June 30, |
|
| inflows |
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| March 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2021 |
|
| AUM(2) |
| 2022 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| ||||||||||||
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 479,240 |
|
| $ | 9,651 |
|
| $ | (10,660 | ) |
| $ | (2,999 | ) |
| $ | 475,232 |
|
| $ | 483,441 |
| $ | 472,849 |
|
| $ | (1,825 | ) |
| $ | (69,076 | ) |
| $ | (8,900 | ) |
| $ | 393,048 |
|
| $ | 434,212 |
|
Fixed income |
| 1,054,517 |
|
|
| (2,662 | ) |
|
| (2,217 | ) |
|
| (4,341 | ) |
|
| 1,045,297 |
|
|
| 1,057,426 |
|
| 1,037,813 |
|
|
| (15,139 | ) |
|
| (56,717 | ) |
|
| (12,000 | ) |
|
| 953,957 |
|
|
| 993,668 |
|
Multi-asset |
| 731,806 |
|
|
| 30,870 |
|
|
| (411 | ) |
|
| (6,020 | ) |
|
| 756,245 |
|
|
| 755,251 |
|
| 767,316 |
|
|
| 1,865 |
|
|
| (89,273 | ) |
|
| (16,613 | ) |
|
| 663,295 |
|
|
| 715,624 |
|
Alternatives |
| 181,069 |
|
|
| 6,669 |
|
|
| 241 |
|
|
| (886 | ) |
|
| 187,093 |
|
|
| 184,583 |
|
| 201,162 |
|
|
| 4,760 |
|
|
| (2,486 | ) |
|
| (3,088 | ) |
|
| 200,348 |
|
|
| 200,855 |
|
Active subtotal |
| 2,446,632 |
|
|
| 44,528 |
|
|
| (13,047 | ) |
|
| (14,246 | ) |
|
| 2,463,867 |
|
|
| 2,480,701 |
|
| 2,479,140 |
|
|
| (10,339 | ) |
|
| (217,552 | ) |
|
| (40,601 | ) |
|
| 2,210,648 |
|
|
| 2,344,359 |
|
Index and ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,257,828 |
|
|
| 34,987 |
|
|
| (36,247 | ) |
|
| (5,719 | ) |
|
| 2,250,849 |
|
|
| 2,279,480 |
|
| 2,350,421 |
|
|
| 23,328 |
|
|
| (348,798 | ) |
|
| (14,608 | ) |
|
| 2,010,343 |
|
|
| 2,178,149 |
|
Fixed income |
| 700,009 |
|
|
| 22,489 |
|
|
| (3,494 | ) |
|
| (2,408 | ) |
|
| 716,596 |
|
|
| 711,729 |
|
| 712,767 |
|
|
| 30,739 |
|
|
| (41,926 | ) |
|
| (5,692 | ) |
|
| 695,888 |
|
|
| 702,485 |
|
Multi-asset |
| 7,663 |
|
|
| 593 |
|
|
| (70 | ) |
|
| (36 | ) |
|
| 8,150 |
|
|
| 7,954 |
|
| 8,716 |
|
|
| 161 |
|
|
| (942 | ) |
|
| (67 | ) |
|
| 7,868 |
|
|
| 8,246 |
|
Alternatives |
| 66,005 |
|
|
| (115 | ) |
|
| (2,688 | ) |
|
| (46 | ) |
|
| 63,156 |
|
|
| 65,863 |
|
| 78,592 |
|
|
| (2,125 | ) |
|
| (6,159 | ) |
|
| (111 | ) |
|
| 70,197 |
|
|
| 75,187 |
|
ETFs subtotal |
| 3,031,505 |
|
|
| 57,954 |
|
|
| (42,499 | ) |
|
| (8,209 | ) |
|
| 3,038,751 |
|
|
| 3,065,026 |
|
| 3,150,496 |
|
|
| 52,103 |
|
|
| (397,825 | ) |
|
| (20,478 | ) |
|
| 2,784,296 |
|
|
| 2,964,067 |
|
Non-ETF Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,297,323 |
|
|
| (11,470 | ) |
|
| 313 |
|
|
| (13,837 | ) |
|
| 2,272,329 |
|
|
| 2,312,474 |
|
| 2,295,774 |
|
|
| 7,139 |
|
|
| (308,637 | ) |
|
| (52,547 | ) |
|
| 1,941,729 |
|
|
| 2,121,237 |
|
Fixed income |
| 957,639 |
|
|
| 7,488 |
|
|
| 6 |
|
|
| (13,127 | ) |
|
| 952,006 |
|
|
| 969,802 |
|
| 895,291 |
|
|
| 20,526 |
|
|
| (75,468 | ) |
|
| (50,350 | ) |
|
| 789,999 |
|
|
| 835,969 |
|
Multi-asset |
| 9,301 |
|
|
| (528 | ) |
|
| 18 |
|
|
| (28 | ) |
|
| 8,763 |
|
|
| 9,101 |
|
| 9,150 |
|
|
| (646 | ) |
|
| (938 | ) |
|
| (264 | ) |
|
| 7,302 |
|
|
| 7,871 |
|
Alternatives |
| 5,710 |
|
|
| - |
|
|
| 223 |
|
|
| (34 | ) |
|
| 5,899 |
|
|
| 5,797 |
|
| 5,699 |
|
|
| (170 | ) |
|
| (99 | ) |
|
| (218 | ) |
|
| 5,212 |
|
|
| 5,602 |
|
Non-ETF Index subtotal |
| 3,269,973 |
|
|
| (4,510 | ) |
|
| 560 |
|
|
| (27,026 | ) |
|
| 3,238,997 |
|
|
| 3,297,174 |
|
| 3,205,914 |
|
|
| 26,849 |
|
|
| (385,142 | ) |
|
| (103,379 | ) |
|
| 2,744,242 |
|
|
| 2,970,679 |
|
Index & ETFs subtotal |
| 6,301,478 |
|
|
| 53,444 |
|
|
| (41,939 | ) |
|
| (35,235 | ) |
|
| 6,277,748 |
|
|
| 6,362,200 |
|
| 6,356,410 |
|
|
| 78,952 |
|
|
| (782,967 | ) |
|
| (123,857 | ) |
|
| 5,528,538 |
|
|
| 5,934,746 |
|
Long-term |
| 8,748,110 |
|
|
| 97,972 |
|
|
| (54,986 | ) |
|
| (49,481 | ) |
|
| 8,741,615 |
|
|
| 8,842,901 |
|
| 8,835,550 |
|
|
| 68,613 |
|
|
| (1,000,519 | ) |
|
| (164,458 | ) |
|
| 7,739,186 |
|
|
| 8,279,105 |
|
Cash management |
| 727,603 |
|
|
| (12,398 | ) |
|
| (784 | ) |
|
| (2,406 | ) |
|
| 712,015 |
|
|
| 722,103 |
|
| 724,939 |
|
|
| 21,218 |
|
|
| (130 | ) |
|
| (6,570 | ) |
|
| 739,457 |
|
|
| 734,270 |
|
Advisory(3) |
| 20,280 |
|
|
| (10,260 | ) |
|
| 23 |
|
|
| (11 | ) |
|
| 10,032 |
|
|
| 13,749 |
|
| 9,025 |
|
| �� | (258 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 8,903 |
|
Total | $ | 9,495,993 |
|
| $ | 75,314 |
|
| $ | (55,747 | ) |
| $ | (51,898 | ) |
| $ | 9,463,662 |
|
| $ | 9,578,753 |
| $ | 9,569,514 |
|
| $ | 89,573 |
|
| $ | (1,000,649 | ) |
| $ | (171,028 | ) |
| $ | 8,487,410 |
|
| $ | 9,022,278 |
|
The following table presents the component changes in AUM by product type for the three months ended SeptemberJune 30, 2021.2022.
|
|
|
|
| Net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||
| June 30, |
|
| inflows |
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| March 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2021 |
|
| AUM(2) |
| 2022 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| ||||||||||||
Equity | $ | 5,034,391 |
|
| $ | 33,168 |
|
| $ | (46,594 | ) |
| $ | (22,555 | ) |
| $ | 4,998,410 |
|
| $ | 5,075,395 |
| $ | 5,119,044 |
|
| $ | 28,642 |
|
| $ | (726,511 | ) |
| $ | (76,055 | ) |
| $ | 4,345,120 |
|
| $ | 4,733,598 |
|
Fixed income |
| 2,712,165 |
|
|
| 27,315 |
|
|
| (5,705 | ) |
|
| (19,876 | ) |
|
| 2,713,899 |
|
|
| 2,738,957 |
|
| 2,645,871 |
|
|
| 36,126 |
|
|
| (174,111 | ) |
|
| (68,042 | ) |
|
| 2,439,844 |
|
|
| 2,532,122 |
|
Multi-asset |
| 748,770 |
|
|
| 30,935 |
|
|
| (463 | ) |
|
| (6,084 | ) |
|
| 773,158 |
|
|
| 772,306 |
|
| 785,182 |
|
|
| 1,380 |
|
|
| (91,153 | ) |
|
| (16,944 | ) |
|
| 678,465 |
|
|
| 731,741 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 95,961 |
|
|
| 2,743 |
|
|
| 195 |
|
|
| (578 | ) |
|
| 98,321 |
|
|
| 97,516 |
|
| 109,141 |
|
|
| 5,414 |
|
|
| (682 | ) |
|
| (1,834 | ) |
|
| 112,039 |
|
|
| 110,501 |
|
Liquid alternatives |
| 81,560 |
|
|
| 3,782 |
|
|
| 9 |
|
|
| (299 | ) |
|
| 85,052 |
|
|
| 83,431 |
|
| 87,326 |
|
|
| (932 | ) |
|
| (1,518 | ) |
|
| (1,106 | ) |
|
| 83,770 |
|
|
| 85,574 |
|
Currency and commodities(4) |
| 75,263 |
|
|
| 29 |
|
|
| (2,428 | ) |
|
| (89 | ) |
|
| 72,775 |
|
|
| 75,296 |
|
| 88,986 |
|
|
| (2,017 | ) |
|
| (6,544 | ) |
|
| (477 | ) |
|
| 79,948 |
|
|
| 85,569 |
|
Alternatives subtotal |
| 252,784 |
|
|
| 6,554 |
|
|
| (2,224 | ) |
|
| (966 | ) |
|
| 256,148 |
|
|
| 256,243 |
|
| 285,453 |
|
|
| 2,465 |
|
|
| (8,744 | ) |
|
| (3,417 | ) |
|
| 275,757 |
|
|
| 281,644 |
|
Long-term |
| 8,748,110 |
|
|
| 97,972 |
|
|
| (54,986 | ) |
|
| (49,481 | ) |
|
| 8,741,615 |
|
|
| 8,842,901 |
|
| 8,835,550 |
|
|
| 68,613 |
|
|
| (1,000,519 | ) |
|
| (164,458 | ) |
|
| 7,739,186 |
|
|
| 8,279,105 |
|
Cash management |
| 727,603 |
|
|
| (12,398 | ) |
|
| (784 | ) |
|
| (2,406 | ) |
|
| 712,015 |
|
|
| 722,103 |
|
| 724,939 |
|
|
| 21,218 |
|
|
| (130 | ) |
|
| (6,570 | ) |
|
| 739,457 |
|
|
| 734,270 |
|
Advisory(3) |
| 20,280 |
|
|
| (10,260 | ) |
|
| 23 |
|
|
| (11 | ) |
|
| 10,032 |
|
|
| 13,749 |
|
| 9,025 |
|
|
| (258 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 8,903 |
|
Total | $ | 9,495,993 |
|
| $ | 75,314 |
|
| $ | (55,747 | ) |
| $ | (51,898 | ) |
| $ | 9,463,662 |
|
| $ | 9,578,753 |
| $ | 9,569,514 |
|
| $ | 89,573 |
|
| $ | (1,000,649 | ) |
| $ | (171,028 | ) |
| $ | 8,487,410 |
|
| $ | 9,022,278 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 ETFs. |
AUM remained flat at $9.5decreased $1.08 trillion to $8.49 trillion at SeptemberJune 30, 2021, as positive net inflows were more than offset2022, driven by net market depreciation and the negative impact of foreign exchange movements.movements, partially offset by net inflows.
Long-term net inflows of $98$69 billion were comprised of net inflows of $58 billion, $23$52 billion and $17$26 billion into ETFs retail and institutional, respectively.respectively, partially offset by $10 billion of retail outflows. Net flows in long-term products are described below.
| • | ETFs net inflows of |
| • |
|
| • | Institutional active net inflows of |
| • |
|
Cash management AUM decreasedincreased to $712$739 billion, driven by net outflowsUS government mandates and included inflows from Circle Internet Financial as the Company became the primary manager of $12 billion.their USD Coin cash reserves.
Net market depreciation of $56 billion$1 trillion was primarily driven by global equity and fixed income market depreciation.
AUM decreased $52$171 billion due to the negative impact of foreign exchange movements, primarily due to the strengthening of the US dollar, largely against the British pound, the Japanese yen and the Euro.
Component Changes in AUM for the NineSix Months Ended SeptemberJune 30, 20212022
The following table presents the component changes in AUM by client type and product type for the ninesix months ended SeptemberJune 30, 2021.
2022.
| December 31, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| December 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Retail: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 338,434 |
|
| $ | 34,153 |
|
| $ | 41,324 |
|
| $ | 35,459 |
|
| $ | (3,633 | ) |
| $ | 445,737 |
|
| $ | 417,230 |
| $ | 471,937 |
|
| $ | 5,329 |
|
| $ | (95,767 | ) |
| $ | (10,273 | ) |
| $ | 371,226 |
|
| $ | 426,530 |
|
Fixed income |
| 340,468 |
|
|
| 26,011 |
|
|
| — |
|
|
| (4,457 | ) |
|
| (2,861 | ) |
|
| 359,161 |
|
|
| 354,337 |
|
| 365,306 |
|
|
| (9,458 | ) |
|
| (37,149 | ) |
|
| (4,839 | ) |
|
| 313,860 |
|
|
| 341,015 |
|
Multi-asset |
| 132,624 |
|
|
| 10,269 |
|
|
| — |
|
|
| 8,505 |
|
|
| (445 | ) |
|
| 150,953 |
|
|
| 143,345 |
|
| 155,461 |
|
|
| (22 | ) |
|
| (25,078 | ) |
|
| (1,219 | ) |
|
| 129,142 |
|
|
| 144,767 |
|
Alternatives |
| 34,391 |
|
|
| 10,139 |
|
|
| — |
|
|
| 468 |
|
|
| (222 | ) |
|
| 44,776 |
|
|
| 39,976 |
|
| 47,349 |
|
|
| 4,342 |
|
|
| (1,879 | ) |
|
| (615 | ) |
|
| 49,197 |
|
|
| 49,151 |
|
Retail subtotal |
| 845,917 |
|
|
| 80,572 |
|
|
| 41,324 |
|
|
| 39,975 |
|
|
| (7,161 | ) |
|
| 1,000,627 |
|
|
| 954,888 |
|
| 1,040,053 |
|
|
| 191 |
|
|
| (159,873 | ) |
|
| (16,946 | ) |
|
| 863,425 |
|
| �� | 961,463 |
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,905,101 |
|
|
| 152,785 |
|
|
| — |
|
|
| 202,397 |
|
|
| (9,434 | ) |
|
| 2,250,849 |
|
|
| 2,142,649 |
|
| 2,447,248 |
|
|
| 64,499 |
|
|
| (484,632 | ) |
|
| (16,772 | ) |
|
| 2,010,343 |
|
|
| 2,255,471 |
|
Fixed income |
| 690,033 |
|
|
| 45,804 |
|
|
| — |
|
|
| (14,826 | ) |
|
| (4,415 | ) |
|
| 716,596 |
|
|
| 694,541 |
|
| 745,373 |
|
|
| 38,889 |
|
|
| (81,054 | ) |
|
| (7,320 | ) |
|
| 695,888 |
|
|
| 713,181 |
|
Multi-asset |
| 6,268 |
|
|
| 1,539 |
|
|
| — |
|
|
| 349 |
|
|
| (6 | ) |
|
| 8,150 |
|
|
| 7,279 |
|
| 9,119 |
|
|
| 231 |
|
|
| (1,433 | ) |
|
| (49 | ) |
|
| 7,868 |
|
|
| 8,466 |
|
Alternatives |
| 67,605 |
|
|
| 1,463 |
|
|
| — |
|
|
| (5,837 | ) |
|
| (75 | ) |
|
| 63,156 |
|
|
| 66,272 |
|
| 65,614 |
|
|
| 4,693 |
|
|
| 14 |
|
|
| (124 | ) |
|
| 70,197 |
|
|
| 72,087 |
|
ETFs subtotal |
| 2,669,007 |
|
|
| 201,591 |
|
|
| — |
|
|
| 182,083 |
|
|
| (13,930 | ) |
|
| 3,038,751 |
|
|
| 2,910,741 |
|
| 3,267,354 |
|
|
| 108,312 |
|
|
| (567,105 | ) |
|
| (24,265 | ) |
|
| 2,784,296 |
|
|
| 3,049,205 |
|
Institutional: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 169,522 |
|
|
| (1,561 | ) |
|
| — |
|
|
| 16,555 |
|
|
| (2,284 | ) |
|
| 182,232 |
|
|
| 179,247 |
|
| 199,980 |
|
|
| 5,716 |
|
|
| (35,704 | ) |
|
| (6,295 | ) |
|
| 163,697 |
|
|
| 183,162 |
|
Fixed income |
| 716,269 |
|
|
| 5,606 |
|
|
| — |
|
|
| (7,030 | ) |
|
| (6,147 | ) |
|
| 708,698 |
|
|
| 710,668 |
|
| 767,402 |
|
|
| (9,667 | ) |
|
| (83,354 | ) |
|
| (12,529 | ) |
|
| 661,852 |
|
|
| 715,059 |
|
Multi-asset |
| 511,242 |
|
|
| 69,106 |
|
|
| — |
|
|
| 33,655 |
|
|
| (8,706 | ) |
|
| 605,297 |
|
|
| 556,569 |
|
| 642,951 |
|
|
| 18,997 |
|
|
| (108,576 | ) |
|
| (19,213 | ) |
|
| 534,159 |
|
|
| 598,329 |
|
Alternatives |
| 127,429 |
|
|
| 12,407 |
|
|
| — |
|
|
| 3,682 |
|
|
| (1,200 | ) |
|
| 142,318 |
|
|
| 135,656 |
|
| 146,384 |
|
|
| 6,627 |
|
|
| 1,285 |
|
|
| (3,142 | ) |
|
| 151,154 |
|
|
| 150,223 |
|
Active subtotal |
| 1,524,462 |
|
|
| 85,558 |
|
|
| — |
|
|
| 46,862 |
|
|
| (18,337 | ) |
|
| 1,638,545 |
|
|
| 1,582,140 |
|
| 1,756,717 |
|
|
| 21,673 |
|
|
| (226,349 | ) |
|
| (41,179 | ) |
|
| 1,510,862 |
|
|
| 1,646,773 |
|
Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,006,749 |
|
|
| (128,801 | ) |
|
| — |
|
|
| 264,183 |
|
|
| (22,539 | ) |
|
| 2,119,592 |
|
|
| 2,101,940 |
|
| 2,223,195 |
|
|
| 29,122 |
|
|
| (388,908 | ) |
|
| (63,555 | ) |
|
| 1,799,854 |
|
|
| 2,036,631 |
|
Fixed income |
| 927,718 |
|
|
| 52,024 |
|
|
| — |
|
|
| (25,447 | ) |
|
| (24,851 | ) |
|
| 929,444 |
|
|
| 933,212 |
|
| 943,960 |
|
|
| 23,885 |
|
|
| (130,877 | ) |
|
| (68,724 | ) |
|
| 768,244 |
|
|
| 861,222 |
|
Multi-asset |
| 8,599 |
|
|
| (90 | ) |
|
| — |
|
|
| 517 |
|
|
| (268 | ) |
|
| 8,758 |
|
|
| 8,919 |
|
| 8,963 |
|
|
| (154 | ) |
|
| (1,135 | ) |
|
| (378 | ) |
|
| 7,296 |
|
|
| 8,173 |
|
Alternatives |
| 5,617 |
|
|
| (538 | ) |
|
| — |
|
|
| 908 |
|
|
| (89 | ) |
|
| 5,898 |
|
|
| 5,680 |
|
| 5,534 |
|
|
| (671 | ) |
|
| 657 |
|
|
| (311 | ) |
|
| 5,209 |
|
|
| 5,540 |
|
Index subtotal |
| 2,948,683 |
|
|
| (77,405 | ) |
|
| — |
|
|
| 240,161 |
|
|
| (47,747 | ) |
|
| 3,063,692 |
|
|
| 3,049,751 |
|
| 3,181,652 |
|
|
| 52,182 |
|
|
| (520,263 | ) |
|
| (132,968 | ) |
|
| 2,580,603 |
|
|
| 2,911,566 |
|
Institutional subtotal |
| 4,473,145 |
|
|
| 8,153 |
|
|
| — |
|
|
| 287,023 |
|
|
| (66,084 | ) |
|
| 4,702,237 |
|
|
| 4,631,891 |
|
| 4,938,369 |
|
|
| 73,855 |
|
|
| (746,612 | ) |
|
| (174,147 | ) |
|
| 4,091,465 |
|
|
| 4,558,339 |
|
Long-term |
| 7,988,069 |
|
|
| 290,316 |
|
|
| 41,324 |
|
|
| 509,081 |
|
|
| (87,175 | ) |
| �� | 8,741,615 |
|
|
| 8,497,520 |
|
| 9,245,776 |
|
|
| 182,358 |
|
|
| (1,473,590 | ) |
|
| (215,358 | ) |
|
| 7,739,186 |
|
|
| 8,569,007 |
|
Cash management |
| 666,252 |
|
|
| 50,132 |
|
|
| — |
|
|
| (996 | ) |
|
| (3,373 | ) |
|
| 712,015 |
|
|
| 704,580 |
|
| 755,057 |
|
|
| (5,876 | ) |
|
| (759 | ) |
|
| (8,965 | ) |
|
| 739,457 |
|
|
| 735,753 |
|
Advisory |
| 22,359 |
|
|
| (12,530 | ) |
|
| — |
|
|
| 200 |
|
|
| 3 |
|
|
| 10,032 |
|
|
| 18,838 |
|
| 9,310 |
|
|
| (543 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 9,012 |
|
Total | $ | 8,676,680 |
|
| $ | 327,918 |
|
| $ | 41,324 |
|
| $ | 508,285 |
|
| $ | (90,545 | ) |
| $ | 9,463,662 |
|
| $ | 9,220,938 |
| $ | 10,010,143 |
|
| $ | 175,939 |
|
| $ | (1,474,349 | ) |
| $ | (224,323 | ) |
| $ | 8,487,410 |
|
| $ | 9,313,772 |
|
(1) |
|
| Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes. |
| Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing |
| 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 ninesix months ended SeptemberJune 30, 2021.2022.
| December 31, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| December 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 410,189 |
|
| $ | 34,854 |
|
| $ | — |
|
| $ | 34,944 |
|
| $ | (4,755 | ) |
| $ | 475,232 |
|
| $ | 457,458 |
| $ | 507,103 |
|
| $ | 172 |
|
| $ | (102,604 | ) |
| $ | (11,623 | ) |
| $ | 393,048 |
|
| $ | 454,645 |
|
Fixed income |
| 1,035,015 |
|
|
| 29,461 |
|
|
| — |
|
|
| (10,534 | ) |
|
| (8,645 | ) |
|
| 1,045,297 |
|
|
| 1,043,135 |
|
| 1,107,085 |
|
|
| (20,416 | ) |
|
| (117,195 | ) |
|
| (15,517 | ) |
|
| 953,957 |
|
|
| 1,032,671 |
|
Multi-asset |
| 643,864 |
|
|
| 79,374 |
|
|
| — |
|
|
| 42,158 |
|
|
| (9,151 | ) |
|
| 756,245 |
|
|
| 699,909 |
|
| 798,404 |
|
|
| 18,974 |
|
|
| (133,653 | ) |
|
| (20,430 | ) |
|
| 663,295 |
|
|
| 743,088 |
|
Alternatives |
| 161,819 |
|
|
| 22,544 |
|
|
| — |
|
|
| 4,153 |
|
|
| (1,423 | ) |
|
| 187,093 |
|
|
| 175,631 |
|
| 193,733 |
|
|
| 10,969 |
|
|
| (596 | ) |
|
| (3,758 | ) |
|
| 200,348 |
|
|
| 199,373 |
|
Active subtotal |
| 2,250,887 |
|
|
| 166,233 |
|
|
| — |
|
|
| 70,721 |
|
|
| (23,974 | ) |
|
| 2,463,867 |
|
|
| 2,376,133 |
|
| 2,606,325 |
|
|
| 9,699 |
|
|
| (354,048 | ) |
|
| (51,328 | ) |
|
| 2,210,648 |
|
|
| 2,429,777 |
|
Index and ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,905,101 |
|
|
| 152,785 |
|
|
| — |
|
|
| 202,397 |
|
|
| (9,434 | ) |
|
| 2,250,849 |
|
|
| 2,142,649 |
|
| 2,447,248 |
|
|
| 64,499 |
|
|
| (484,632 | ) |
|
| (16,772 | ) |
|
| 2,010,343 |
|
|
| 2,255,471 |
|
Fixed income |
| 690,033 |
|
|
| 45,804 |
|
|
| — |
|
|
| (14,826 | ) |
|
| (4,415 | ) |
|
| 716,596 |
|
|
| 694,541 |
|
| 745,373 |
|
|
| 38,889 |
|
|
| (81,054 | ) |
|
| (7,320 | ) |
|
| 695,888 |
|
|
| 713,181 |
|
Multi-asset |
| 6,268 |
|
|
| 1,539 |
|
|
| — |
|
|
| 349 |
|
|
| (6 | ) |
|
| 8,150 |
|
|
| 7,279 |
|
| 9,119 |
|
|
| 231 |
|
|
| (1,433 | ) |
|
| (49 | ) |
|
| 7,868 |
|
|
| 8,466 |
|
Alternatives |
| 67,605 |
|
|
| 1,463 |
|
|
| — |
|
|
| (5,837 | ) |
|
| (75 | ) |
|
| 63,156 |
|
|
| 66,272 |
|
| 65,614 |
|
|
| 4,693 |
|
|
| 14 |
|
|
| (124 | ) |
|
| 70,197 |
|
|
| 72,087 |
|
ETFs subtotal |
| 2,669,007 |
|
|
| 201,591 |
|
|
| — |
|
|
| 182,083 |
|
|
| (13,930 | ) |
|
| 3,038,751 |
|
|
| 2,910,741 |
|
| 3,267,354 |
|
|
| 108,312 |
|
|
| (567,105 | ) |
|
| (24,265 | ) |
|
| 2,784,296 |
|
|
| 3,049,205 |
|
Non-ETF Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 2,104,516 |
|
|
| (131,063 | ) |
|
| 41,324 |
|
|
| 281,253 |
|
|
| (23,701 | ) |
|
| 2,272,329 |
|
|
| 2,240,959 |
|
| 2,388,009 |
|
|
| 39,995 |
|
|
| (417,775 | ) |
|
| (68,500 | ) |
|
| 1,941,729 |
|
|
| 2,191,678 |
|
Fixed income |
| 949,440 |
|
|
| 54,180 |
|
|
| — |
|
|
| (26,400 | ) |
|
| (25,214 | ) |
|
| 952,006 |
|
|
| 955,082 |
|
| 969,583 |
|
|
| 25,176 |
|
|
| (134,185 | ) |
|
| (70,575 | ) |
|
| 789,999 |
|
|
| 884,625 |
|
Multi-asset |
| 8,601 |
|
|
| (89 | ) |
|
| — |
|
|
| 519 |
|
|
| (268 | ) |
|
| 8,763 |
|
|
| 8,924 |
|
| 8,971 |
|
|
| (153 | ) |
|
| (1,136 | ) |
|
| (380 | ) |
|
| 7,302 |
|
|
| 8,181 |
|
Alternatives |
| 5,618 |
|
|
| (536 | ) |
|
| — |
|
|
| 905 |
|
|
| (88 | ) |
|
| 5,899 |
|
|
| 5,681 |
|
| 5,534 |
|
|
| (671 | ) |
|
| 659 |
|
|
| (310 | ) |
|
| 5,212 |
|
|
| 5,541 |
|
Non-ETF Index subtotal |
| 3,068,175 |
|
|
| (77,508 | ) |
|
| 41,324 |
|
|
| 256,277 |
|
|
| (49,271 | ) |
|
| 3,238,997 |
|
|
| 3,210,646 |
|
| 3,372,097 |
|
|
| 64,347 |
|
|
| (552,437 | ) |
|
| (139,765 | ) |
|
| 2,744,242 |
|
|
| 3,090,025 |
|
Index & ETFs subtotal |
| 5,737,182 |
|
|
| 124,083 |
|
|
| 41,324 |
|
|
| 438,360 |
|
|
| (63,201 | ) |
|
| 6,277,748 |
|
|
| 6,121,387 |
|
| 6,639,451 |
|
|
| 172,659 |
|
|
| (1,119,542 | ) |
|
| (164,030 | ) |
|
| 5,528,538 |
|
|
| 6,139,230 |
|
Long-term |
| 7,988,069 |
|
|
| 290,316 |
|
|
| 41,324 |
|
|
| 509,081 |
|
|
| (87,175 | ) |
|
| 8,741,615 |
|
|
| 8,497,520 |
|
| 9,245,776 |
|
|
| 182,358 |
|
|
| (1,473,590 | ) |
|
| (215,358 | ) |
|
| 7,739,186 |
|
|
| 8,569,007 |
|
Cash management |
| 666,252 |
|
|
| 50,132 |
|
|
| — |
|
|
| (996 | ) |
|
| (3,373 | ) |
|
| 712,015 |
|
|
| 704,580 |
|
| 755,057 |
|
|
| (5,876 | ) |
|
| (759 | ) |
|
| (8,965 | ) |
|
| 739,457 |
|
|
| 735,753 |
|
Advisory(4) |
| 22,359 |
|
|
| (12,530 | ) |
|
| — |
|
|
| 200 |
|
|
| 3 |
|
|
| 10,032 |
|
|
| 18,838 |
| |||||||||||||||||||||||
Advisory(3) |
| 9,310 |
|
|
| (543 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 9,012 |
| |||||||||||||||||||||||||||
Total | $ | 8,676,680 |
|
| $ | 327,918 |
|
| $ | 41,324 |
|
| $ | 508,285 |
|
| $ | (90,545 | ) |
| $ | 9,463,662 |
|
| $ | 9,220,938 |
| $ | 10,010,143 |
|
| $ | 175,939 |
|
| $ | (1,474,349 | ) |
| $ | (224,323 | ) |
| $ | 8,487,410 |
|
| $ | 9,313,772 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents the component changes in AUM by product type for the ninesix months ended SeptemberJune 30, 2021.2022.
| December 31, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| December 31, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Equity | $ | 4,419,806 |
|
| $ | 56,576 |
|
| $ | 41,324 |
|
| $ | 518,594 |
|
| $ | (37,890 | ) |
| $ | 4,998,410 |
|
| $ | 4,841,066 |
| $ | 5,342,360 |
|
| $ | 104,666 |
|
| $ | (1,005,011 | ) |
| $ | (96,895 | ) |
| $ | 4,345,120 |
|
| $ | 4,901,794 |
|
Fixed income |
| 2,674,488 |
|
|
| 129,445 |
|
|
| — |
|
|
| (51,760 | ) |
|
| (38,274 | ) |
|
| 2,713,899 |
|
|
| 2,692,758 |
|
| 2,822,041 |
|
|
| 43,649 |
|
|
| (332,434 | ) |
|
| (93,412 | ) |
|
| 2,439,844 |
|
|
| 2,630,477 |
|
Multi-asset |
| 658,733 |
|
|
| 80,824 |
|
|
| — |
|
|
| 43,026 |
|
|
| (9,425 | ) |
|
| 773,158 |
|
|
| 716,112 |
|
| 816,494 |
|
|
| 19,052 |
|
|
| (136,222 | ) |
|
| (20,859 | ) |
|
| 678,465 |
|
|
| 759,735 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 85,770 |
|
|
| 12,315 |
|
|
| — |
|
|
| 1,148 |
|
|
| (912 | ) |
|
| 98,321 |
|
|
| 93,102 |
|
| 102,579 |
|
|
| 9,286 |
|
|
| 2,525 |
|
|
| (2,351 | ) |
|
| 112,039 |
|
|
| 108,652 |
|
Liquid alternatives |
| 73,218 |
|
|
| 9,455 |
|
|
| — |
|
|
| 2,745 |
|
|
| (366 | ) |
|
| 85,052 |
|
|
| 79,234 |
|
| 87,348 |
|
|
| 976 |
|
|
| (3,377 | ) |
|
| (1,177 | ) |
|
| 83,770 |
|
|
| 86,251 |
|
Currency and commodities |
| 76,054 |
|
|
| 1,701 |
|
|
| — |
|
|
| (4,672 | ) |
|
| (308 | ) |
|
| 72,775 |
|
|
| 75,248 |
|
| 74,954 |
|
|
| 4,729 |
|
|
| 929 |
|
|
| (664 | ) |
|
| 79,948 |
|
|
| 82,098 |
|
Alternatives subtotal |
| 235,042 |
|
|
| 23,471 |
|
|
| — |
|
|
| (779 | ) |
|
| (1,586 | ) |
|
| 256,148 |
|
|
| 247,584 |
|
| 264,881 |
|
|
| 14,991 |
|
|
| 77 |
|
|
| (4,192 | ) |
|
| 275,757 |
|
|
| 277,001 |
|
Long-term |
| 7,988,069 |
|
|
| 290,316 |
|
|
| 41,324 |
|
|
| 509,081 |
|
|
| (87,175 | ) |
|
| 8,741,615 |
|
|
| 8,497,520 |
|
| 9,245,776 |
|
|
| 182,358 |
|
|
| (1,473,590 | ) |
|
| (215,358 | ) |
|
| 7,739,186 |
|
|
| 8,569,007 |
|
Cash management |
| 666,252 |
|
|
| 50,132 |
|
|
| — |
|
|
| (996 | ) |
|
| (3,373 | ) |
|
| 712,015 |
|
|
| 704,580 |
|
| 755,057 |
|
|
| (5,876 | ) |
|
| (759 | ) |
|
| (8,965 | ) |
|
| 739,457 |
|
|
| 735,753 |
|
Advisory |
| 22,359 |
|
|
| (12,530 | ) |
|
| — |
|
|
| 200 |
|
|
| 3 |
|
|
| 10,032 |
|
|
| 18,838 |
|
| 9,310 |
|
|
| (543 | ) |
|
| - |
|
|
| - |
|
|
| 8,767 |
|
|
| 9,012 |
|
Total | $ | 8,676,680 |
|
| $ | 327,918 |
|
| $ | 41,324 |
|
| $ | 508,285 |
|
| $ | (90,545 | ) |
| $ | 9,463,662 |
|
| $ | 9,220,938 |
| $ | 10,010,143 |
|
| $ | 175,939 |
|
| $ | (1,474,349 | ) |
| $ | (224,323 | ) |
| $ | 8,487,410 |
|
| $ | 9,313,772 |
|
(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 seven 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 ETFs. |
AUM increased $787 billiondecreased $1.52 trillion to $9.5$8.49 trillion at SeptemberJune 30, 2021, 2022, driven by net market appreciation, positive net inflows,depreciation and AUM acquired in the Aperio Transaction, partially offset by thenegative impact of foreign exchange movements.movements, partially offset by net inflows.
Long-term net inflows of $290$182 billion were comprised of net inflows of $202 billion, $81$108 billion and $8$74 billion into ETFs retail and institutional, respectively. Net flows in long-term products are described below.
| • | ETFs net inflows of |
| • |
|
| • | Institutional active net inflows of |
|
|
Cash management AUM increaseddecreased to $712$739 billion, driven bydue to net inflowsoutflows of $50$6 billion and the negative impact of foreign exchange movements of $9 billion.
Net market appreciationdepreciation of $508 billion$1.5 trillion was primarily driven primarily by global equity and fixed income market appreciation.depreciation.
AUM decreased $91$224 billion due to the negative impact of foreign exchange movements, primarily resulting fromdue to the strengthening of the US dollar, largely against the EuroBritish pound, the Japanese yen and the Japanese yen.Euro.
Component Changes in AUM for the Twelve Months Ended SeptemberJune 30, 20212022
The following table presents the component changes in AUM by client type and product type for the twelve months ended SeptemberJune 30, 2021.2022.
| September 30, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| June 30, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Retail: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 279,427 |
|
| $ | 50,248 |
|
| $ | 41,324 |
|
| $ | 73,968 |
|
| $ | 770 |
|
| $ | 445,737 |
|
| $ | 387,825 |
| $ | 446,327 |
|
| $ | 23,190 |
|
| $ | (84,740 | ) |
| $ | (13,551 | ) |
| $ | 371,226 |
|
| $ | 439,849 |
|
Fixed income |
| 316,008 |
|
|
| 40,231 |
|
|
| — |
|
|
| 2,060 |
|
|
| 862 |
|
|
| 359,161 |
|
|
| 347,052 |
|
| 359,480 |
|
|
| 3,925 |
|
|
| (42,563 | ) |
|
| (6,982 | ) |
|
| 313,860 |
|
|
| 350,333 |
|
Multi-asset |
| 119,708 |
|
|
| 12,914 |
|
|
| — |
|
|
| 18,198 |
|
|
| 133 |
|
|
| 150,953 |
|
|
| 138,466 |
|
| 147,228 |
|
|
| 7,683 |
|
|
| (24,120 | ) |
|
| (1,649 | ) |
|
| 129,142 |
|
|
| 147,910 |
|
Alternatives |
| 31,121 |
|
|
| 12,496 |
|
|
| — |
|
|
| 1,081 |
|
|
| 78 |
|
|
| 44,776 |
|
|
| 38,183 |
|
| 42,448 |
|
|
| 9,588 |
|
|
| (2,023 | ) |
|
| (816 | ) |
|
| 49,197 |
|
|
| 46,930 |
|
Retail subtotal |
| 746,264 |
|
|
| 115,889 |
|
|
| 41,324 |
|
|
| 95,307 |
|
|
| 1,843 |
|
|
| 1,000,627 |
|
|
| 911,526 |
|
| 995,483 |
|
|
| 44,386 |
|
|
| (153,446 | ) |
|
| (22,998 | ) |
|
| 863,425 |
|
|
| 985,022 |
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,586,849 |
|
|
| 218,042 |
|
|
| — |
|
|
| 446,634 |
|
|
| (676 | ) |
|
| 2,250,849 |
|
|
| 2,028,304 |
|
| 2,257,828 |
|
|
| 169,555 |
|
|
| (392,003 | ) |
|
| (25,037 | ) |
|
| 2,010,343 |
|
|
| 2,279,120 |
|
Fixed income |
| 662,999 |
|
|
| 59,339 |
|
|
| — |
|
|
| (6,063 | ) |
|
| 321 |
|
|
| 716,596 |
|
|
| 689,132 |
|
| 700,009 |
|
|
| 94,433 |
|
|
| (87,618 | ) |
|
| (10,936 | ) |
|
| 695,888 |
|
|
| 714,420 |
|
Multi-asset |
| 5,430 |
|
|
| 1,955 |
|
|
| — |
|
|
| 736 |
|
|
| 29 |
|
|
| 8,150 |
|
|
| 6,895 |
|
| 7,663 |
|
|
| 1,551 |
|
|
| (1,265 | ) |
|
| (81 | ) |
|
| 7,868 |
|
|
| 8,312 |
|
Alternatives |
| 66,057 |
|
|
| 1,008 |
|
|
| — |
|
|
| (3,935 | ) |
|
| 26 |
|
|
| 63,156 |
|
|
| 65,933 |
|
| 66,005 |
|
|
| 4,670 |
|
|
| (311 | ) |
|
| (167 | ) |
|
| 70,197 |
|
|
| 69,079 |
|
ETFs subtotal |
| 2,321,335 |
|
|
| 280,344 |
|
|
| — |
|
|
| 437,372 |
|
|
| (300 | ) |
|
| 3,038,751 |
|
|
| 2,790,264 |
|
| 3,031,505 |
|
|
| 270,209 |
|
|
| (481,197 | ) |
|
| (36,221 | ) |
|
| 2,784,296 |
|
|
| 3,070,931 |
|
Institutional: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 149,260 |
|
|
| (4,379 | ) |
|
| — |
|
|
| 37,231 |
|
|
| 120 |
|
|
| 182,232 |
|
|
| 173,263 |
|
| 184,174 |
|
|
| 15,311 |
|
|
| (27,814 | ) |
|
| (7,974 | ) |
|
| 163,697 |
|
|
| 184,401 |
|
Fixed income |
| 693,061 |
|
|
| 9,122 |
|
|
| — |
|
|
| 5,825 |
|
|
| 690 |
|
|
| 708,698 |
|
|
| 707,349 |
|
| 716,671 |
|
|
| 43,210 |
|
|
| (80,946 | ) |
|
| (17,083 | ) |
|
| 661,852 |
|
|
| 720,305 |
|
Multi-asset |
| 464,242 |
|
|
| 66,535 |
|
|
| — |
|
|
| 74,282 |
|
|
| 238 |
|
|
| 605,297 |
|
|
| 536,848 |
|
| 584,582 |
|
|
| 58,347 |
|
|
| (81,391 | ) |
|
| (27,379 | ) |
|
| 534,159 |
|
|
| 603,840 |
|
Alternatives |
| 120,559 |
|
|
| 15,635 |
|
|
| — |
|
|
| 5,555 |
|
|
| 569 |
|
|
| 142,318 |
|
|
| 132,368 |
|
| 138,622 |
|
|
| 13,870 |
|
|
| 2,652 |
|
|
| (3,990 | ) |
|
| 151,154 |
|
|
| 146,260 |
|
Active subtotal |
| 1,427,122 |
|
|
| 86,913 |
|
|
| — |
|
|
| 122,893 |
|
|
| 1,617 |
|
|
| 1,638,545 |
|
|
| 1,549,828 |
|
| 1,624,049 |
|
|
| 130,738 |
|
|
| (187,499 | ) |
|
| (56,426 | ) |
|
| 1,510,862 |
|
|
| 1,654,806 |
|
Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,768,582 |
|
|
| (159,258 | ) |
|
| — |
|
|
| 508,028 |
|
|
| 2,240 |
|
|
| 2,119,592 |
|
|
| 2,034,356 |
|
| 2,146,062 |
|
|
| (25,116 | ) |
|
| (239,291 | ) |
|
| (81,801 | ) |
|
| 1,799,854 |
|
|
| 2,096,323 |
|
Fixed income |
| 859,397 |
|
|
| 83,457 |
|
|
| — |
|
|
| (16,605 | ) |
|
| 3,195 |
|
|
| 929,444 |
|
|
| 919,677 |
|
| 936,005 |
|
|
| 30,288 |
|
|
| (111,182 | ) |
|
| (86,867 | ) |
|
| 768,244 |
|
|
| 902,546 |
|
Multi-asset |
| 8,866 |
|
|
| (982 | ) |
|
| — |
|
|
| 1,029 |
|
|
| (155 | ) |
|
| 8,758 |
|
|
| 8,804 |
|
| 9,297 |
|
|
| (587 | ) |
|
| (925 | ) |
|
| (489 | ) |
|
| 7,296 |
|
|
| 9,074 |
|
Alternatives |
| 4,563 |
|
|
| 150 |
|
|
| — |
|
|
| 1,186 |
|
|
| (1 | ) |
|
| 5,898 |
|
|
| 5,512 |
|
| 5,709 |
|
|
| (1,036 | ) |
|
| 906 |
|
|
| (370 | ) |
|
| 5,209 |
|
|
| 5,604 |
|
Index subtotal |
| 2,641,408 |
|
|
| (76,633 | ) |
|
| — |
|
|
| 493,638 |
|
|
| 5,279 |
|
|
| 3,063,692 |
|
|
| 2,968,349 |
|
| 3,097,073 |
|
|
| 3,549 |
|
|
| (350,492 | ) |
|
| (169,527 | ) |
|
| 2,580,603 |
|
|
| 3,013,547 |
|
Institutional subtotal |
| 4,068,530 |
|
|
| 10,280 |
|
|
| — |
|
|
| 616,531 |
|
|
| 6,896 |
|
|
| 4,702,237 |
|
|
| 4,518,177 |
|
| 4,721,122 |
|
|
| 134,287 |
|
|
| (537,991 | ) |
|
| (225,953 | ) |
|
| 4,091,465 |
|
|
| 4,668,353 |
|
Long-term |
| 7,136,129 |
|
|
| 406,513 |
|
|
| 41,324 |
|
|
| 1,149,210 |
|
|
| 8,439 |
|
|
| 8,741,615 |
|
|
| 8,219,967 |
|
| 8,748,110 |
|
|
| 448,882 |
|
|
| (1,172,634 | ) |
|
| (285,172 | ) |
|
| 7,739,186 |
|
|
| 8,724,306 |
|
Cash management |
| 652,002 |
|
|
| 59,076 |
|
|
| — |
|
|
| (1,215 | ) |
|
| 2,152 |
|
|
| 712,015 |
|
|
| 695,260 |
|
| 727,603 |
|
|
| 25,638 |
|
|
| (1,687 | ) |
|
| (12,097 | ) |
|
| 739,457 |
|
|
| 729,454 |
|
Advisory |
| 20,366 |
|
|
| (10,738 | ) |
|
| — |
|
|
| 377 |
|
|
| 27 |
|
|
| 10,032 |
|
|
| 19,358 |
|
| 20,280 |
|
|
| (11,530 | ) |
|
| 18 |
|
|
| (1 | ) |
|
| 8,767 |
|
|
| 10,566 |
|
Total | $ | 7,808,497 |
|
| $ | 454,851 |
|
| $ | 41,324 |
|
| $ | 1,148,372 |
|
| $ | 10,618 |
|
| $ | 9,463,662 |
|
| $ | 8,934,585 |
| $ | 9,495,993 |
|
| $ | 462,990 |
|
| $ | (1,174,303 | ) |
| $ | (297,270 | ) |
| $ | 8,487,410 |
|
| $ | 9,464,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
| Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes. |
| Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months. |
| 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 SeptemberJune 30, 2021.2022.
| September 30, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| June 30, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Active: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity | $ | 347,631 |
|
| $ | 43,476 |
|
| $ | — |
|
| $ | 84,336 |
|
| $ | (211 | ) |
| $ | 475,232 |
|
| $ | 434,610 |
| $ | 479,240 |
|
| $ | 23,744 |
|
| $ | (94,518 | ) |
| $ | (15,418 | ) |
| $ | 393,048 |
|
| $ | 468,953 |
|
Fixed income |
| 989,412 |
|
|
| 46,244 |
|
|
| — |
|
|
| 8,559 |
|
|
| 1,082 |
|
|
| 1,045,297 |
|
|
| 1,032,919 |
|
| 1,054,517 |
|
|
| 41,507 |
|
|
| (120,201 | ) |
|
| (21,866 | ) |
|
| 953,957 |
|
|
| 1,047,608 |
|
Multi-asset |
| 583,952 |
|
|
| 79,443 |
|
|
| — |
|
|
| 92,479 |
|
|
| 371 |
|
|
| 756,245 |
|
|
| 675,310 |
|
| 731,806 |
|
|
| 66,025 |
|
|
| (105,509 | ) |
|
| (29,027 | ) |
|
| 663,295 |
|
|
| 751,743 |
|
Alternatives |
| 151,678 |
|
|
| 28,130 |
|
|
| — |
|
|
| 6,638 |
|
|
| 647 |
|
|
| 187,093 |
|
|
| 170,550 |
|
| 181,069 |
|
|
| 23,458 |
|
|
| 627 |
|
|
| (4,806 | ) |
|
| 200,348 |
|
|
| 193,189 |
|
Active subtotal |
| 2,072,673 |
|
|
| 197,293 |
|
|
| — |
|
|
| 192,012 |
|
|
| 1,889 |
|
|
| 2,463,867 |
|
|
| 2,313,389 |
|
| 2,446,632 |
|
|
| 154,734 |
|
|
| (319,601 | ) |
|
| (71,117 | ) |
|
| 2,210,648 |
|
|
| 2,461,493 |
|
Index and ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ETFs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,586,849 |
|
|
| 218,042 |
|
|
| — |
|
|
| 446,634 |
|
|
| (676 | ) |
|
| 2,250,849 |
|
|
| 2,028,304 |
|
| 2,257,828 |
|
|
| 169,555 |
|
|
| (392,003 | ) |
|
| (25,037 | ) |
|
| 2,010,343 |
|
|
| 2,279,120 |
|
Fixed income |
| 662,999 |
|
|
| 59,339 |
|
|
| — |
|
|
| (6,063 | ) |
|
| 321 |
|
|
| 716,596 |
|
|
| 689,132 |
|
| 700,009 |
|
|
| 94,433 |
|
|
| (87,618 | ) |
|
| (10,936 | ) |
|
| 695,888 |
|
|
| 714,420 |
|
Multi-asset |
| 5,430 |
|
|
| 1,955 |
|
|
| — |
|
|
| 736 |
|
|
| 29 |
|
|
| 8,150 |
|
|
| 6,895 |
|
| 7,663 |
|
|
| 1,551 |
|
|
| (1,265 | ) |
|
| (81 | ) |
|
| 7,868 |
|
|
| 8,312 |
|
Alternatives |
| 66,057 |
|
|
| 1,008 |
|
|
| — |
|
|
| (3,935 | ) |
|
| 26 |
|
|
| 63,156 |
|
|
| 65,933 |
|
| 66,005 |
|
|
| 4,670 |
|
|
| (311 | ) |
|
| (167 | ) |
|
| 70,197 |
|
|
| 69,079 |
|
ETFs subtotal |
| 2,321,335 |
|
|
| 280,344 |
|
|
| — |
|
|
| 437,372 |
|
|
| (300 | ) |
|
| 3,038,751 |
|
|
| 2,790,264 |
|
| 3,031,505 |
|
|
| 270,209 |
|
|
| (481,197 | ) |
|
| (36,221 | ) |
|
| 2,784,296 |
|
|
| 3,070,931 |
|
Non-ETF Index: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 1,849,638 |
|
|
| (156,865 | ) |
|
| 41,324 |
|
|
| 534,891 |
|
|
| 3,341 |
|
|
| 2,272,329 |
|
|
| 2,160,834 |
|
| 2,297,323 |
|
|
| (10,359 | ) |
|
| (257,327 | ) |
|
| (87,908 | ) |
|
| 1,941,729 |
|
|
| 2,251,620 |
|
Fixed income |
| 879,054 |
|
|
| 86,566 |
|
|
| — |
|
|
| (17,279 | ) |
|
| 3,665 |
|
|
| 952,006 |
|
|
| 941,159 |
|
| 957,639 |
|
|
| 35,916 |
|
|
| (114,490 | ) |
|
| (89,066 | ) |
|
| 789,999 |
|
|
| 925,576 |
|
Multi-asset |
| 8,864 |
|
|
| (976 | ) |
|
| — |
|
|
| 1,030 |
|
|
| (155 | ) |
|
| 8,763 |
|
|
| 8,808 |
|
| 9,301 |
|
|
| (582 | ) |
|
| (927 | ) |
|
| (490 | ) |
|
| 7,302 |
|
|
| 9,081 |
|
Alternatives |
| 4,565 |
|
|
| 151 |
|
|
| — |
|
|
| 1,184 |
|
|
| (1 | ) |
|
| 5,899 |
|
|
| 5,513 |
|
| 5,710 |
|
|
| (1,036 | ) |
|
| 908 |
|
|
| (370 | ) |
|
| 5,212 |
|
|
| 5,605 |
|
Non-ETF Index subtotal |
| 2,742,121 |
|
|
| (71,124 | ) |
|
| 41,324 |
|
|
| 519,826 |
|
|
| 6,850 |
|
|
| 3,238,997 |
|
|
| 3,116,314 |
|
| 3,269,973 |
|
|
| 23,939 |
|
|
| (371,836 | ) |
|
| (177,834 | ) |
|
| 2,744,242 |
|
|
| 3,191,882 |
|
Index & ETFs subtotal |
| 5,063,456 |
|
|
| 209,220 |
|
|
| 41,324 |
|
|
| 957,198 |
|
|
| 6,550 |
|
|
| 6,277,748 |
|
|
| 5,906,578 |
|
| 6,301,478 |
|
|
| 294,148 |
|
|
| (853,033 | ) |
|
| (214,055 | ) |
|
| 5,528,538 |
|
|
| 6,262,813 |
|
Long-term |
| 7,136,129 |
|
|
| 406,513 |
|
|
| 41,324 |
|
|
| 1,149,210 |
|
|
| 8,439 |
|
|
| 8,741,615 |
|
|
| 8,219,967 |
|
| 8,748,110 |
|
|
| 448,882 |
|
|
| (1,172,634 | ) |
|
| (285,172 | ) |
|
| 7,739,186 |
|
|
| 8,724,306 |
|
Cash management |
| 652,002 |
|
|
| 59,076 |
|
|
| — |
|
|
| (1,215 | ) |
|
| 2,152 |
|
|
| 712,015 |
|
|
| 695,260 |
|
| 727,603 |
|
|
| 25,638 |
|
|
| (1,687 | ) |
|
| (12,097 | ) |
|
| 739,457 |
|
|
| 729,454 |
|
Advisory |
| 20,366 |
|
|
| (10,738 | ) |
|
| — |
|
|
| 377 |
|
|
| 27 |
|
|
| 10,032 |
|
|
| 19,358 |
|
| 20,280 |
|
|
| (11,530 | ) |
|
| 18 |
|
|
| (1 | ) |
|
| 8,767 |
|
|
| 10,566 |
|
Total | $ | 7,808,497 |
|
| $ | 454,851 |
|
| $ | 41,324 |
|
| $ | 1,148,372 |
|
| $ | 10,618 |
|
| $ | 9,463,662 |
|
| $ | 8,934,585 |
| $ | 9,495,993 |
|
| $ | 462,990 |
|
| $ | (1,174,303 | ) |
| $ | (297,270 | ) |
| $ | 8,487,410 |
|
| $ | 9,464,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents the component changes in AUM by product type for the twelve months ended SeptemberJune 30, 2021.2022.
| September 30, |
|
| Net inflows |
|
|
|
|
|
| Market |
|
| FX |
|
| September 30, |
|
| Average |
| June 30, |
|
| Net inflows |
|
| Market |
|
| FX |
|
| June 30, |
|
| Average |
| ||||||||||||
(in millions) | 2020 |
|
| (outflows) |
|
| Acquisition(1) |
|
| change |
|
| impact(2) |
|
| 2021 |
|
| AUM(3) |
| 2021 |
|
| (outflows) |
|
| change |
|
| impact(1) |
|
| 2022 |
|
| AUM(2) |
| |||||||||||||
Equity | $ | 3,784,118 |
|
| $ | 104,653 |
|
| $ | 41,324 |
|
| $ | 1,065,861 |
|
| $ | 2,454 |
|
| $ | 4,998,410 |
|
| $ | 4,623,748 |
| $ | 5,034,391 |
|
| $ | 182,940 |
|
| $ | (743,848 | ) |
| $ | (128,363 | ) |
| $ | 4,345,120 |
|
| $ | 4,999,693 |
|
Fixed income |
| 2,531,465 |
|
|
| 192,149 |
|
|
| — |
|
|
| (14,783 | ) |
|
| 5,068 |
|
|
| 2,713,899 |
|
|
| 2,663,210 |
|
| 2,712,165 |
|
|
| 171,856 |
|
|
| (322,309 | ) |
|
| (121,868 | ) |
|
| 2,439,844 |
|
|
| 2,687,604 |
|
Multi-asset |
| 598,246 |
|
|
| 80,422 |
|
|
| — |
|
|
| 94,245 |
|
|
| 245 |
|
|
| 773,158 |
|
|
| 691,013 |
|
| 748,770 |
|
|
| 66,994 |
|
|
| (107,701 | ) |
|
| (29,598 | ) |
|
| 678,465 |
|
|
| 769,136 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 79,723 |
|
|
| 16,844 |
|
|
| — |
|
|
| 1,660 |
|
|
| 94 |
|
|
| 98,321 |
|
|
| 90,319 |
|
| 95,961 |
|
|
| 15,835 |
|
|
| 3,322 |
|
|
| (3,079 | ) |
|
| 112,039 |
|
|
| 103,771 |
|
Liquid alternatives |
| 69,255 |
|
|
| 10,492 |
|
|
| — |
|
|
| 4,653 |
|
|
| 652 |
|
|
| 85,052 |
|
|
| 77,069 |
|
| 81,560 |
|
|
| 6,629 |
|
|
| (2,983 | ) |
|
| (1,436 | ) |
|
| 83,770 |
|
|
| 85,311 |
|
Currency and commodities |
| 73,322 |
|
|
| 1,953 |
|
|
| — |
|
|
| (2,426 | ) |
|
| (74 | ) |
|
| 72,775 |
|
|
| 74,608 |
|
| 75,263 |
|
|
| 4,628 |
|
|
| 885 |
|
|
| (828 | ) |
|
| 79,948 |
|
|
| 78,791 |
|
Alternatives subtotal |
| 222,300 |
|
|
| 29,289 |
|
|
| — |
|
|
| 3,887 |
|
|
| 672 |
|
|
| 256,148 |
|
|
| 241,996 |
|
| 252,784 |
|
|
| 27,092 |
|
|
| 1,224 |
|
|
| (5,343 | ) |
|
| 275,757 |
|
|
| 267,873 |
|
Long-term |
| 7,136,129 |
|
|
| 406,513 |
|
|
| 41,324 |
|
|
| 1,149,210 |
|
|
| 8,439 |
|
|
| 8,741,615 |
|
|
| 8,219,967 |
|
| 8,748,110 |
|
|
| 448,882 |
|
|
| (1,172,634 | ) |
|
| (285,172 | ) |
|
| 7,739,186 |
|
|
| 8,724,306 |
|
Cash management |
| 652,002 |
|
|
| 59,076 |
|
|
| — |
|
|
| (1,215 | ) |
|
| 2,152 |
|
|
| 712,015 |
|
|
| 695,260 |
|
| 727,603 |
|
|
| 25,638 |
|
|
| (1,687 | ) |
|
| (12,097 | ) |
|
| 739,457 |
|
|
| 729,454 |
|
Advisory |
| 20,366 |
|
|
| (10,738 | ) |
|
| — |
|
|
| 377 |
|
|
| 27 |
|
|
| 10,032 |
|
|
| 19,358 |
|
| 20,280 |
|
|
| (11,530 | ) |
|
| 18 |
|
|
| (1 | ) |
|
| 8,767 |
|
|
| 10,566 |
|
Total | $ | 7,808,497 |
|
| $ | 454,851 |
|
| $ | 41,324 |
|
| $ | 1,148,372 |
|
| $ | 10,618 |
|
| $ | 9,463,662 |
|
| $ | 8,934,585 |
| $ | 9,495,993 |
|
| $ | 462,990 |
|
| $ | (1,174,303 | ) |
| $ | (297,270 | ) |
| $ | 8,487,410 |
|
| $ | 9,464,326 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
| Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes. |
| Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months. |
| Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments. |
| Amounts include commodity ETFs. |
AUM increased $1.7decreased $1 trillion to $9.5$8.49 trillion at SeptemberJune 30, 2021,2022, driven by net market appreciation, positive net inflows,depreciation and the positivenegative impact of foreign exchange movements, and AUM acquired in the Aperio Transaction.partially offset by net inflows.
Long-term net inflows of $407$449 billion were comprised of net inflows of $280$270 billion, $116$135 billion and $10$44 billion from ETFs, retailinstitutional, and institutional,retail respectively. Net flows in long-term products are described below.
| • | ETFs net inflows of |
|
|
| • | Institutional active net inflows of |
| • | Institutional index net |
• | Retail net inflows of $44 billion included net inflows of $27 billion and $17 billion in the US and internationally, respectively. Retail net inflows reflected strength in thematic and global equity and US growth equity funds, natural resources, unconstrained, municipal and total return fixed income funds, multi-asset and alternatives funds. |
Cash management AUM increased to $712$739 billion, driven by net inflows of $59 billion.$26 billion partially offset by the negative impact of foreign exchange movements.
Net market appreciationdepreciation of $1.1$1.2 trillion was driven by global equity and fixed income market appreciation.depreciation.
AUM increased $11decreased $297 billion due to the positivenegative impact of foreign exchange movements, primarily resulting from the weakeningstrengthening of the US dollar, largely against the British pound, Euro and the Canadian dollar, partially offset by the strengthening of the US dollar against the Japanese yen and the Euro.yen.
DISCUSSION OF FINANCIAL RESULTS
The Company’s results of operations for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 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, 20202021 (“20202021 Form 10-K”).
Revenue
The table below presents detail of revenue for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 and includes the product type mix of base fees and securities lending revenue and performance fees.
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Investment advisory, administration fees and securities lending revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active | $ | 674 |
|
| $ | 457 |
|
| $ | 1,891 |
|
| $ | 1,236 |
| $ | 550 |
|
| $ | 641 |
|
| $ | 1,166 |
|
| $ | 1,217 |
|
ETFs |
| 1,212 |
|
|
| 880 |
|
|
| 3,436 |
|
|
| 2,551 |
|
| 1,103 |
|
|
| 1,156 |
|
|
| 2,261 |
|
|
| 2,224 |
|
Non-ETF Index |
| 207 |
|
|
| 164 |
|
|
| 581 |
|
|
| 505 |
|
| 186 |
|
|
| 198 |
|
|
| 373 |
|
|
| 374 |
|
Equity subtotal |
| 2,093 |
|
|
| 1,501 |
|
|
| 5,908 |
|
|
| 4,292 |
|
| 1,839 |
|
|
| 1,995 |
|
|
| 3,800 |
|
|
| 3,815 |
|
Fixed income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 561 |
|
|
| 498 |
|
|
| 1,631 |
|
|
| 1,443 |
|
| 503 |
|
|
| 545 |
|
|
| 1,037 |
|
|
| 1,070 |
|
ETFs |
| 304 |
|
|
| 297 |
|
|
| 893 |
|
|
| 817 |
|
| 274 |
|
|
| 294 |
|
|
| 563 |
|
|
| 589 |
|
Non-ETF Index |
| 121 |
|
|
| 113 |
|
|
| 350 |
|
|
| 354 |
|
| 102 |
|
|
| 116 |
|
|
| 220 |
|
|
| 229 |
|
Fixed income subtotal |
| 986 |
|
|
| 908 |
|
|
| 2,874 |
|
|
| 2,614 |
|
| 879 |
|
|
| 955 |
|
|
| 1,820 |
|
|
| 1,888 |
|
Multi-asset |
| 369 |
|
|
| 289 |
|
|
| 1,041 |
|
|
| 852 |
|
| 331 |
|
|
| 344 |
|
|
| 690 |
|
|
| 672 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 166 |
|
|
| 140 |
|
|
| 501 |
|
|
| 416 |
|
| 184 |
|
|
| 167 |
|
|
| 363 |
|
|
| 335 |
|
Liquid alternatives |
| 163 |
|
|
| 132 |
|
|
| 460 |
|
|
| 361 |
|
| 161 |
|
|
| 150 |
|
|
| 328 |
|
|
| 297 |
|
Currency and commodities(1) |
| 55 |
|
|
| 51 |
|
|
| 163 |
|
|
| 118 |
| |||||||||||||||
Currency and commodities(1) |
| 62 |
|
|
| 55 |
|
|
| 118 |
|
|
| 108 |
| |||||||||||||||
Alternatives subtotal |
| 384 |
|
|
| 323 |
|
|
| 1,124 |
|
|
| 895 |
|
| 407 |
|
|
| 372 |
|
|
| 809 |
|
|
| 740 |
|
Long-term |
| 3,832 |
|
|
| 3,021 |
|
|
| 10,947 |
|
|
| 8,653 |
|
| 3,456 |
|
|
| 3,666 |
|
|
| 7,119 |
|
|
| 7,115 |
|
Cash management |
| 111 |
|
|
| 204 |
|
|
| 345 |
|
|
| 593 |
|
| 232 |
|
|
| 91 |
|
|
| 402 |
|
|
| 234 |
|
Total investment advisory, administration fees and securities lending revenue |
| 3,943 |
|
|
| 3,225 |
|
|
| 11,292 |
|
|
| 9,246 |
|
| 3,688 |
|
|
| 3,757 |
|
|
| 7,521 |
|
|
| 7,349 |
|
Investment advisory performance fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
| 8 |
|
|
| 4 |
|
|
| 70 |
|
|
| 29 |
|
| 3 |
|
|
| 36 |
|
|
| 15 |
|
|
| 62 |
|
Fixed income |
| 2 |
|
|
| 9 |
|
|
| 31 |
|
|
| 13 |
|
| 13 |
|
|
| 15 |
|
|
| 22 |
|
|
| 29 |
|
Multi-asset |
| — |
|
|
| 10 |
|
|
| 17 |
|
|
| 13 |
|
| 7 |
|
|
| 9 |
|
|
| 12 |
|
|
| 17 |
|
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 50 |
|
|
| 6 |
|
|
| 147 |
|
|
| 55 |
|
| 65 |
|
|
| 90 |
|
|
| 102 |
|
|
| 97 |
|
Liquid alternatives |
| 285 |
|
|
| 503 |
|
|
| 549 |
|
|
| 575 |
|
| 18 |
|
|
| 190 |
|
|
| 53 |
|
|
| 264 |
|
Alternatives subtotal |
| 335 |
|
|
| 509 |
|
|
| 696 |
|
|
| 630 |
|
| 83 |
|
|
| 280 |
|
|
| 155 |
|
|
| 361 |
|
Total performance fees |
| 345 |
|
|
| 532 |
|
|
| 814 |
|
|
| 685 |
|
| 106 |
|
|
| 340 |
|
|
| 204 |
|
|
| 469 |
|
Technology services revenue |
| 320 |
|
|
| 282 |
|
|
| 942 |
|
|
| 834 |
|
| 332 |
|
|
| 316 |
|
|
| 673 |
|
|
| 622 |
|
Distribution fees: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retrocessions |
| 294 |
|
|
| 188 |
|
|
| 796 |
|
|
| 519 |
|
| 269 |
|
|
| 264 |
|
|
| 548 |
|
|
| 502 |
|
12b-1 fees (US mutual fund distribution fees) |
| 91 |
|
|
| 85 |
|
|
| 263 |
|
|
| 254 |
|
| 80 |
|
|
| 87 |
|
|
| 168 |
|
|
| 172 |
|
Other |
| 16 |
|
|
| 15 |
|
|
| 51 |
|
|
| 44 |
|
| 12 |
|
|
| 18 |
|
|
| 26 |
|
|
| 35 |
|
Total distribution fees |
| 401 |
|
|
| 288 |
|
|
| 1,110 |
|
|
| 817 |
|
| 361 |
|
|
| 369 |
|
|
| 742 |
|
|
| 709 |
|
Advisory and other revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advisory |
| 13 |
|
|
| 14 |
|
|
| 37 |
|
|
| 48 |
|
| 15 |
|
|
| 9 |
|
|
| 31 |
|
|
| 24 |
|
Other |
| 28 |
|
|
| 28 |
|
|
| 73 |
|
|
| 97 |
|
| 24 |
|
|
| 29 |
|
|
| 54 |
|
|
| 45 |
|
Total advisory and other revenue |
| 41 |
|
|
| 42 |
|
|
| 110 |
|
|
| 145 |
|
| 39 |
|
|
| 38 |
|
|
| 85 |
|
|
| 69 |
|
Total revenue | $ | 5,050 |
|
| $ | 4,369 |
|
| $ | 14,268 |
|
| $ | 11,727 |
| $ | 4,526 |
|
| $ | 4,820 |
|
| $ | 9,225 |
|
| $ | 9,218 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 June 30, |
|
| Six Months Ended June 30, |
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 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) |
| 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) |
| ||||||||||||||||||||||||||||||||||||||||
| 2021 |
|
| 2020 |
|
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
|
|
| 2022 |
|
| 2021 |
| ||||||||||||||||
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 18 | % |
|
| 15 | % |
|
|
| 5 | % |
|
| 4 | % |
|
| 19 | % |
|
| 14 | % |
|
|
| 5 | % |
|
| 4 | % |
| 15 | % |
|
| 18 | % |
|
|
| 5 | % |
|
| 5 | % |
|
| 15 | % |
|
| 19 | % |
|
|
| 5 | % |
|
| 5 | % |
ETFs |
| 31 | % |
|
| 27 | % |
|
|
| 24 | % |
|
| 20 | % |
|
| 30 | % |
|
| 28 | % |
|
|
| 23 | % |
|
| 21 | % |
| 30 | % |
|
| 31 | % |
|
|
| 24 | % |
|
| 24 | % |
|
| 30 | % |
|
| 30 | % |
|
|
| 23 | % |
|
| 23 | % |
Non-ETF Index |
| 5 | % |
|
| 5 | % |
|
|
| 23 | % |
|
| 24 | % |
|
| 5 | % |
|
| 5 | % |
|
|
| 24 | % |
|
| 23 | % |
| 5 | % |
|
| 5 | % |
|
|
| 24 | % |
|
| 23 | % |
|
| 5 | % |
|
| 5 | % |
|
|
| 24 | % |
|
| 24 | % |
Equity subtotal |
| 54 | % |
|
| 47 | % |
|
|
| 52 | % |
|
| 48 | % |
|
| 54 | % |
|
| 47 | % |
|
|
| 52 | % |
|
| 48 | % |
| 50 | % |
|
| 54 | % |
|
|
| 53 | % |
|
| 52 | % |
|
| 50 | % |
|
| 54 | % |
|
|
| 52 | % |
|
| 52 | % |
Fixed income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active |
| 13 | % |
|
| 15 | % |
|
|
| 12 | % |
|
| 13 | % |
|
| 13 | % |
|
| 15 | % |
|
|
| 11 | % |
|
| 13 | % |
| 14 | % |
|
| 14 | % |
|
|
| 11 | % |
|
| 12 | % |
|
| 14 | % |
|
| 14 | % |
|
|
| 11 | % |
|
| 11 | % |
ETFs |
| 8 | % |
|
| 9 | % |
|
|
| 7 | % |
|
| 9 | % |
|
| 8 | % |
|
| 9 | % |
|
|
| 8 | % |
|
| 8 | % |
| 7 | % |
|
| 8 | % |
|
|
| 8 | % |
|
| 7 | % |
|
| 7 | % |
|
| 8 | % |
|
|
| 8 | % |
|
| 8 | % |
Non-ETF Index |
| 3 | % |
|
| 4 | % |
|
|
| 10 | % |
|
| 11 | % |
|
| 3 | % |
|
| 4 | % |
|
|
| 10 | % |
|
| 12 | % |
| 3 | % |
|
| 3 | % |
|
|
| 9 | % |
|
| 10 | % |
|
| 3 | % |
|
| 3 | % |
|
|
| 10 | % |
|
| 10 | % |
Fixed income subtotal |
| 24 | % |
|
| 28 | % |
|
|
| 29 | % |
|
| 33 | % |
|
| 24 | % |
|
| 28 | % |
|
|
| 29 | % |
|
| 33 | % |
| 24 | % |
|
| 25 | % |
|
|
| 28 | % |
|
| 29 | % |
|
| 24 | % |
|
| 25 | % |
|
|
| 29 | % |
|
| 29 | % |
Multi-asset |
| 9 | % |
|
| 9 | % |
|
|
| 8 | % |
|
| 8 | % |
|
| 9 | % |
|
| 9 | % |
|
|
| 8 | % |
|
| 8 | % |
| 9 | % |
|
| 9 | % |
|
|
| 8 | % |
|
| 8 | % |
|
| 9 | % |
|
| 9 | % |
|
|
| 8 | % |
|
| 8 | % |
Alternatives: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illiquid alternatives |
| 5 | % |
|
| 4 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 5 | % |
|
| 5 | % |
|
|
| 1 | % |
|
| 1 | % |
| 5 | % |
|
| 5 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 5 | % |
|
| 5 | % |
|
|
| 1 | % |
|
| 1 | % |
Liquid alternatives |
| 4 | % |
|
| 4 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 4 | % |
|
| 4 | % |
|
|
| 1 | % |
|
| 1 | % |
| 4 | % |
|
| 4 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 4 | % |
|
| 4 | % |
|
|
| 1 | % |
|
| 1 | % |
Currency and commodities(3) |
| 1 | % |
|
| 2 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 1 | % |
|
| 1 | % |
|
|
| 1 | % |
|
| 1 | % | |||||||||||||||||||||||||||||||||
Currency and commodities(3) |
| 2 | % |
|
| 1 | % |
|
|
| 1 | % |
|
| 1 | % |
|
| 3 | % |
|
| 1 | % |
|
|
| 1 | % |
|
| 1 | % | |||||||||||||||||||||||||||||||||
Alternatives subtotal |
| 10 | % |
|
| 10 | % |
|
|
| 3 | % |
|
| 3 | % |
|
| 10 | % |
|
| 10 | % |
|
|
| 3 | % |
|
| 3 | % |
| 11 | % |
|
| 10 | % |
|
|
| 3 | % |
|
| 3 | % |
|
| 12 | % |
|
| 10 | % |
|
|
| 3 | % |
|
| 3 | % |
Long-term |
| 97 | % |
|
| 94 | % |
|
|
| 92 | % |
|
| 92 | % |
|
| 97 | % |
|
| 94 | % |
|
|
| 92 | % |
|
| 92 | % |
| 94 | % |
|
| 98 | % |
|
|
| 92 | % |
|
| 92 | % |
|
| 95 | % |
|
| 98 | % |
|
|
| 92 | % |
|
| 92 | % |
Cash management |
| 3 | % |
|
| 6 | % |
|
|
| 8 | % |
|
| 8 | % |
|
| 3 | % |
|
| 6 | % |
|
|
| 8 | % |
|
| 8 | % |
| 6 | % |
|
| 2 | % |
|
|
| 8 | % |
|
| 8 | % |
|
| 5 | % |
|
| 2 | % |
|
|
| 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) | Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing |
(3) | Amounts include commodity ETFs. |
Three Months Ended SeptemberJune 30, 20212022 Compared with Three Months Ended SeptemberJune 30, 20202021
Revenue increased $681decreased $294 million, or 16%6%, from the three months ended SeptemberJune 30, 2020, reflecting market gains as well as strong organic growth2021, primarily driven by the impact of significantly lower markets and 13% growth in technology services revenue, partially offset byUS dollar appreciation on average AUM and lower performance fees.
Investment advisory, administration fees and securities lending revenue of $3,943$3,688 million increased $718decreased $69 million from $3,225$3,757 million for the three months ended SeptemberJune 30, 2020,2021, primarily driven by the positivenegative impact of market beta and foreign exchange movements on average AUM, and strongpartially offset by organic base fee growth, partially offset by the impactelimination of yield-related fee waivers on certain money market funds, and strategic pricing changes to certain products.higher securities lending revenue. Securities lending revenue of $152$160 million decreasedincreased from $153$140 million infor the third quarter of 2020,three months ended June 30, 2021, primarily reflecting lower asset spreads, partially offset by higher average balances of securities on loan.spreads.
Investment advisory performance fees of $345$106 million decreased $187$234 million from $532$340 million for the three months ended SeptemberJune 30, 2020,2021, primarily reflecting lower revenue from liquid alternative products, including lower fees from a single hedge fund strategy with an annual performance measurement period that ends in the third quarter, partially offset by higher revenue from illiquid alternativeand long-only products.
Technology services revenue of $320$332 million increased $38$16 million from $282$316 million for the three months ended SeptemberJune 30, 2020, primarily2021, reflecting higher revenue from continued strong client demand for Aladdin,. despite the negative impact of foreign exchange movements.
Nine
Six Months Ended SeptemberJune 30, 20212022 Compared with NineSix Months Ended SeptemberJune 30, 20202021
Revenue increased $2,541$7 million or 22%, from the ninesix months ended SeptemberJune 30, 2020,2021, reflecting higher base and performance fees, and higher technology services revenue partiallyand securities lending revenue, largely offset by lower securities lending revenue.performance fees.
Investment advisory, administration fees and securities lending revenue of $11,292$7,521 million increased $2,046$172 million from $9,246$7,349 million for the ninesix months ended SeptemberJune 30, 2020,2021, primarily driven by strong organic base fee growth,the positiveelimination of yield-related fee waivers on money market funds, and higher securities lending revenue, partially offset by the negative impact of market beta and foreign exchange movements on average AUM and organic growth, partially offset by the impact of yield-related fee waivers on certain money market funds and strategic pricing changes to certain products, and lower securities lending revenue.AUM. Securities lending revenue of $419$298 million decreased $102increased $31 million from $521$267 million for the ninesix months ended SeptemberJune 30, 2020,2021, primarily reflecting lower spreads, partially offset by higher average balances of securities on loan.spreads.
Investment advisory performance fees of $814$204 million increased $129decreased $265 million from $685$469 million for the ninesix months ended SeptemberJune 30, 2020,2021, primarily reflecting higherlower revenue from illiquidliquid alternative and long-only products.
Technology services revenue of $942$673 million increased $108$51 million from $834$622 million for the ninesix months ended SeptemberJune 30, 2020,2021, primarily reflecting higher revenue from AladdinAladdin.
Advisory and other revenue, of $110 million decreased $35 million from $145 million fordespite the nine months ended September 30, 2020, primarily reflecting thenegative impact of the Charitable Contribution, lower earnings from a strategic minority investment and lower fees from advisory assignments.foreign exchange movements.
Expense
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and benefits | $ | 1,527 |
|
| $ | 1,411 |
|
| $ | 4,484 |
|
| $ | 3,700 |
| $ | 1,414 |
|
| $ | 1,548 |
|
| $ | 2,912 |
|
| $ | 2,957 |
|
Distribution and servicing costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retrocessions |
| 294 |
|
|
| 188 |
|
|
| 796 |
|
|
| 519 |
|
| 269 |
|
|
| 264 |
|
|
| 548 |
|
|
| 502 |
|
12b-1 costs |
| 89 |
|
|
| 83 |
|
|
| 257 |
|
|
| 247 |
|
| 78 |
|
|
| 85 |
|
|
| 164 |
|
|
| 168 |
|
Other |
| 202 |
|
|
| 185 |
|
|
| 560 |
|
|
| 564 |
|
| 225 |
|
|
| 174 |
|
|
| 434 |
|
|
| 358 |
|
Total distribution and servicing costs |
| 585 |
|
|
| 456 |
|
|
| 1,613 |
|
|
| 1,330 |
|
| 572 |
|
|
| 523 |
|
|
| 1,146 |
|
|
| 1,028 |
|
Direct fund expense |
| 354 |
|
|
| 257 |
|
|
| 994 |
|
|
| 780 |
|
| 304 |
|
|
| 320 |
|
|
| 633 |
|
|
| 640 |
|
General and administration expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketing and promotional |
| 54 |
|
|
| 48 |
|
|
| 142 |
|
|
| 156 |
|
| 76 |
|
|
| 53 |
|
|
| 136 |
|
|
| 88 |
|
Occupancy and office related |
| 91 |
|
|
| 81 |
|
|
| 250 |
|
|
| 239 |
|
| 106 |
|
|
| 80 |
|
|
| 205 |
|
|
| 159 |
|
Portfolio services |
| 93 |
|
|
| 73 |
|
|
| 267 |
|
|
| 203 |
|
| 67 |
|
|
| 64 |
|
|
| 136 |
|
|
| 129 |
|
Sub-advisory |
| 20 |
|
|
| 23 |
|
|
| 42 |
|
|
| 45 |
| |||||||||||||||
Technology |
| 140 |
|
|
| 93 |
|
|
| 373 |
|
|
| 273 |
|
| 148 |
|
|
| 129 |
|
|
| 293 |
|
|
| 233 |
|
Professional services |
| 42 |
|
|
| 36 |
|
|
| 122 |
|
|
| 121 |
|
| 42 |
|
|
| 41 |
|
|
| 82 |
|
|
| 80 |
|
Communications |
| 11 |
|
|
| 14 |
|
|
| 33 |
|
|
| 40 |
|
| 10 |
|
|
| 11 |
|
|
| 21 |
|
|
| 22 |
|
Foreign exchange remeasurement |
| 1 |
|
|
| 1 |
|
|
| 3 |
|
|
| 7 |
|
| 2 |
|
|
| (2 | ) |
|
| (1 | ) |
|
| 2 |
|
Contingent consideration fair value adjustments |
| 29 |
|
|
| — |
|
|
| 33 |
|
|
| 23 |
|
| — |
|
|
| 1 |
|
|
| 1 |
|
|
| 4 |
|
Product launch costs |
| 96 |
|
|
| 80 |
|
|
| 274 |
|
|
| 164 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 178 |
|
Charitable Contribution |
| — |
|
|
| — |
|
|
| — |
|
|
| 589 |
| |||||||||||||||
Other general and administration |
| 54 |
|
|
| 35 |
|
|
| 160 |
|
|
| 176 |
|
| 59 |
|
|
| 61 |
|
|
| 111 |
|
|
| 106 |
|
Total general and administration expense |
| 611 |
|
|
| 461 |
|
|
| 1,657 |
|
|
| 1,991 |
|
| 530 |
|
|
| 461 |
|
|
| 1,026 |
|
|
| 1,046 |
|
Amortization of intangible assets |
| 38 |
|
|
| 27 |
|
|
| 109 |
|
|
| 79 |
|
| 38 |
|
|
| 37 |
|
|
| 76 |
|
|
| 71 |
|
Total expense | $ | 3,115 |
|
| $ | 2,612 |
|
| $ | 8,857 |
|
| $ | 7,880 |
| $ | 2,858 |
|
| $ | 2,889 |
|
| $ | 5,793 |
|
| $ | 5,742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended SeptemberJune 30, 20212022 Compared with Three Months Ended SeptemberJune 30, 20202021
Expense increased $503decreased $31 million from the three months ended SeptemberJune 30, 2020,2021, largely driven by lower employee compensation and benefits expense, partially offset by higher general and administration expense, higher employee compensation and benefits expense and higher direct fund expense in the third quarter of 2021.expense.
Employee compensation and benefits expense increased $116decreased $134 million from the three months ended SeptemberJune 30, 2020, primarily2021, reflecting lower incentive compensation, due to lower operating income and performance fees, and lower deferred compensation driven in part by the lower mark-to-market impact of certain deferred cash compensation programs, partially offset by higher 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$69 million from the three months ended SeptemberJune 30, 2020, reflecting2021, primarily driven by higher technologymarketing and portfolio servicespromotional expense, resulting from higher travel and entertainment expense, and higher technology expense. The increase also reflected higher product launch costs, primarily associated with the previously discussed BlackRock ESG Capital Allocation Trust, higher contingent consideration fair value adjustments,occupancy and $11office related expense, including $15 million of previously discussed 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.Yards”), which it expects to begin to occupy in late 2022 (and begin lease payments in May 2023). Lease cost – Hudson Yards has been excluded from our “as adjusted” financial results. See Non-GAAP Financial Measures for further information on as adjusted items.
Amortization of intangible assets expenseSix Months Ended June 30, 2022 Compared with Six Months Ended June 30, 2021
Expense increased $11$51 million from the threesix months ended September 30, 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.
Nine Months Ended SeptemberJune 30, 2021, Compared with Nine Months Ended September 30, 2020
Expense increased $977 million from the nine months ended September 30, 2020, largely driven by higher employee compensation and benefits expense and higher volume-related expense, partially offset by lower employee compensation and benefits expense and lower general and administration expense, reflectingincluding the impact of the Charitable Contribution recorded in the nine months ended September 30, 2020. Expense also reflected higher product launch costs incurred during the ninesix months ended SeptemberJune 30, 2021.
Employee compensation and benefits expense increased $784decreased $45 million from the ninesix months ended SeptemberJune 30, 2020, primarily2021, reflecting higher base andlower incentive compensation driven by higherdue to lower operating income and higher performance fees, and lower deferred compensation driven in part by the lower mark-to-market impact of certain deferred cash compensation programs, partially offset by higher deferredbase compensation.
Direct fund expense increased $214 million from the nine months ended September 30, 2020, primarily reflecting higher average AUM.
General and administration expense decreased $334$20 million from the ninesix months ended SeptemberJune 30, 2020, largely2021, primarily driven by $178 million of product launch costs incurred during the Charitable Contribution recorded in the ninesix months ended SeptemberJune 30, 2020.2021, partially offset by higher technology expense and higher marketing and promotional expense, resulting from higher travel and entertainment expense. General and administration expense also reflected higher occupancy and office related 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, andincluding $27 million of Lease cost – Hudson Yards described above, partially offset by lower marketing and promotional expense and the 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 from the nine months ended September 30, 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.above.
Nonoperating Results
The summary of nonoperating income (expense), less net income (loss) attributable to NCI for the three and ninesix months ended SeptemberJune 30, 20212022 and 20202021 was as follows:
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Nonoperating income (expense), GAAP basis | $ | 336 |
|
| $ | 224 |
|
| $ | 652 |
|
| $ | 510 |
| $ | (347 | ) |
| $ | 270 |
|
| $ | (485 | ) |
| $ | 316 |
|
Less: Net income (loss) attributable to NCI |
| 72 |
|
|
| 153 |
|
|
| 315 |
|
|
| 162 |
|
| (114 | ) |
|
| 169 |
|
|
| (187 | ) |
|
| 243 |
|
Nonoperating income (expense), net of NCI(2) | $ | 264 |
|
| $ | 71 |
|
| $ | 337 |
|
| $ | 348 |
| |||||||||||||||
Nonoperating income (expense), net of NCI(1)(2) | $ | (233 | ) |
| $ | 101 |
|
| $ | (298 | ) |
| $ | 73 |
|
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
| ||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||
Net gain (loss) on investments(1)(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Net gain (loss) on investments(1)(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Private equity | $ | 124 |
|
| $ | 18 |
|
| $ | 212 |
|
| $ | 8 |
| $ | (8 | ) |
| $ | 66 |
|
| $ | 2 |
|
| $ | 88 |
|
Real assets |
| 4 |
|
|
| 6 |
|
|
| 10 |
|
|
| 11 |
|
| 1 |
|
|
| 3 |
|
|
| 14 |
|
|
| 6 |
|
Other alternatives(3) |
| 13 |
|
|
| 14 |
|
|
| 43 |
|
|
| 10 |
| |||||||||||||||
Other investments(4) |
| (8 | ) |
|
| 55 |
|
|
| 37 |
|
|
| 35 |
| |||||||||||||||
Other alternatives(3) |
| (5 | ) |
|
| 17 |
|
|
| (1 | ) |
|
| 30 |
| |||||||||||||||
Other investments(4) |
| (112 | ) |
|
| 48 |
|
|
| (187 | ) |
|
| 45 |
| |||||||||||||||
Subtotal |
| 133 |
|
|
| 93 |
|
|
| 302 |
|
|
| 64 |
|
| (124 | ) |
|
| 134 |
|
|
| (172 | ) |
|
| 169 |
|
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 |
| |||||||||||||||
Other gains (losses)(5) |
| (76 | ) |
|
| 11 |
|
|
| (57 | ) |
|
| (16 | ) | |||||||||||||||
Total net gain (loss) on investments(1)(2) |
| (200 | ) |
|
| 145 |
|
|
| (229 | ) |
|
| 153 |
| |||||||||||||||
Interest and dividend income |
| 14 |
|
|
| 9 |
|
|
| 41 |
|
|
| 34 |
|
| 21 |
|
|
| 8 |
|
|
| 39 |
|
|
| 27 |
|
Interest expense |
| (48 | ) |
|
| (54 | ) |
|
| (155 | ) |
|
| (151 | ) |
| (54 | ) |
|
| (52 | ) |
|
| (108 | ) |
|
| (107 | ) |
Net interest expense |
| (34 | ) |
|
| (45 | ) |
|
| (114 | ) |
|
| (117 | ) |
| (33 | ) |
|
| (44 | ) |
|
| (69 | ) |
|
| (80 | ) |
Nonoperating income (expense)(1) | $ | 264 |
|
| $ | 71 |
|
| $ | 337 |
|
| $ | 348 |
| |||||||||||||||
Nonoperating income (expense)(1) | $ | (233 | ) |
| $ | 101 |
|
| $ | (298 | ) |
| $ | 73 |
|
(1) | Net of net income (loss) attributable to NCI. |
(2) | Management believes nonoperating income (expense), less net income (loss) attributable to NCI, is an effective measure for reviewing BlackRock’s nonoperating results, which ultimately impacts BlackRock’s book value. See Non-GAAP Financial Measures for further information on other non-GAAP financial measures for the three and |
(3) | Amounts primarily include net gains (losses) related to credit funds, direct hedge fund strategies and hedge fund solutions. |
(4) | Amounts primarily include mark-to-market net gains (losses) related to unhedged equity, fixed income and multi-asset seed investments. |
(5) | Amounts |
Income Tax Expense
| GAAP |
|
| As Adjusted(1) |
| GAAP |
|
| As Adjusted |
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended |
|
| Nine Months Ended |
|
| Three Months Ended |
|
| Nine Months Ended |
| Three Months Ended |
|
| Six Months Ended |
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||||||||||||||||||||||||||||||||||
| September 30, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
| June 30, |
|
| June 30, |
|
| June 30, |
|
| June 30, |
| ||||||||||||||||||||||||||||||||||||||||||
(in millions) | 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||||||||||||||||
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 |
| |||||||||||||||||||||||||||||||||
Operating income(1) | $ | 1,668 |
|
| $ | 1,931 |
|
| $ | 3,432 |
|
| $ | 3,476 |
|
| $ | 1,727 |
|
| $ | 2,016 |
|
| $ | 3,549 |
|
| $ | 3,615 |
| |||||||||||||||||||||||||||||||||
Total nonoperating income (expense)(1)(2) | $ | (233 | ) |
| $ | 101 |
|
| $ | (298 | ) |
| $ | 73 |
|
| $ | (233 | ) |
| $ | 101 |
|
| $ | (298 | ) |
| $ | 73 |
| |||||||||||||||||||||||||||||||||
Income before income taxes | $ | 2,199 |
|
| $ | 1,828 |
|
| $ | 5,748 |
|
| $ | 4,195 |
|
| $ | 2,210 |
|
| $ | 1,828 |
|
| $ | 5,759 |
|
| $ | 4,662 |
| $ | 1,435 |
|
| $ | 2,032 |
|
| $ | 3,134 |
|
| $ | 3,549 |
|
| $ | 1,494 |
|
| $ | 2,117 |
|
| $ | 3,251 |
|
| $ | 3,688 |
| ||
Income tax expense | $ | 518 |
|
| $ | 464 |
|
| $ | 1,490 |
|
| $ | 811 |
|
| $ | 520 |
|
| $ | 410 |
|
| $ | 1,321 |
|
| $ | 998 |
| $ | 358 |
|
| $ | 654 |
|
| $ | 621 |
|
| $ | 972 |
|
| $ | 372 |
|
| $ | 503 |
|
| $ | 667 |
|
| $ | 834 |
| ||
Effective tax rate |
| 23.6 | % |
|
| 25.4 | % |
|
| 25.9 | % |
|
| 19.3 | % |
|
| 23.6 | % |
|
| 22.5 | % |
|
| 22.9 | % |
|
| 21.4 | % |
| 24.9 | % |
|
| 32.2 | % |
|
| 19.8 | % |
|
| 27.4 | % |
|
| 24.9 | % |
|
| 23.8 | % |
|
| 20.5 | % |
|
| 22.6 | % |
(1) | As adjusted items are described in more detail in Non-GAAP Financial Measures. Beginning in the first quarter of 2022, BlackRock updated the definitions of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include new adjustments. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments. For further information, refer to the Current Report on Form 8-K furnished on April 13, 2022. |
(2) | Net of net income (loss) attributable to NCI. |
2021.2022. Income tax expense for the ninesix months ended SeptemberJune 30, 2022 included $133 million of discrete tax benefits related to stock-based compensation awards that vested in the first quarter and the resolution of certain outstanding tax matters. In addition, GAAP income tax expense for the six months ended June 30, 2022 included $18 million of net noncash tax benefit related to the revaluation of certain deferred income tax liabilities, which was excluded from our as adjusted results, as it will not have a cash flow impact and to ensure comparability among periods presented.
2021. Income tax expense for the three and six months ended June 30, 2021 included $171 million of noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the UKUnited Kingdom 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.
Therate, which was excluded from our as adjusted effective tax rate of 22.9% for the nine months ended September 30, 2021, excluded the impact of $171 million noncash deferred tax revaluation expense mentioned aboveresults, as it will not have a cash flow impact and to ensure comparability among periods presented.
2020. Income tax expense for the ninesix months ended SeptemberJune 30, 2020, included a discrete tax benefit of $241 million recognized in connection with the Charitable Contribution and $782021 also reflected $39 million of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of 2020.2021.
The three and nine months ended September 30, 2020 income tax expense also included the previously described $54 million noncash net expense related to legislation enacted in the UK.
The as adjusted effective tax rate of 22.5% and 21.4% for the three and nine months ended September 30, 2020 excluded the impact of the $54 million noncash 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.
STATEMENT OF FINANCIAL CONDITION OVERVIEW
As Adjusted 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 products (“CIPs”).products.
The Company presents the as adjusted statement of financial condition as additional information to enable investors to exclude certain assets that have equal and offsetting liabilities or NCI that ultimately do not have an impact on stockholders’ equity or cash flows. Management views the as adjusted statement of financial condition, which contains non-GAAP financial 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 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 receivedobtained under BlackRock Life Limited securities lending arrangements for which it has legal title 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 Products
The Company consolidates certain sponsored investment products accounted for as variable interest entities (“VIEs”) and voting rights entities (“VREs”), (collectively, “consolidated sponsored investment products” or “CIPs”). See Note 2, Significant Accounting Policies, in the notes to the consolidated financial statements contained in the 20202021 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 CIPs to use in its operating activities. In addition, the Company cannot readily sell investments held by CIPs in order to obtain cash for use in the Company’s operations.
|
| September 30, 2021 |
|
| June 30, 2022 |
| ||||||||||||||||||||||||||
(in millions) |
| GAAP Basis |
|
| Separate Account Assets/ Collateral(1) |
|
| CIPs(2) |
|
| As Adjusted |
|
| GAAP Basis |
|
| Separate Account Assets/ Collateral(1) |
|
| CIPs(2) |
|
| As Adjusted |
| ||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
| $ | 7,361 |
|
| $ | — |
|
| $ | 265 |
|
| $ | 7,096 |
|
| $ | 6,481 |
|
| $ | — |
|
| $ | 318 |
|
| $ | 6,163 |
|
Accounts receivable |
|
| 4,015 |
|
|
| — |
|
|
| — |
|
|
| 4,015 |
|
|
| 3,471 |
|
|
| — |
|
|
| — |
|
|
| 3,471 |
|
Investments |
|
| 7,101 |
|
|
| — |
|
|
| 1,549 |
|
|
| 5,552 |
|
|
| 7,302 |
|
|
| — |
|
|
| 1,252 |
|
|
| 6,050 |
|
Separate account assets and collateral held under securities lending agreements |
|
| 110,861 |
|
|
| 110,861 |
|
|
| — |
|
|
| — |
|
|
| 68,548 |
|
|
| 68,548 |
|
|
| — |
|
|
| — |
|
Operating lease right-of-use assets |
|
| 1,798 |
|
|
|
|
|
|
|
|
|
|
| 1,798 |
|
|
| 1,543 |
|
|
| — |
|
|
| — |
|
|
| 1,543 |
|
Other assets(3) |
|
| 4,664 |
|
|
| — |
|
|
| 96 |
|
|
| 4,568 |
|
|
| 4,898 |
|
|
| — |
|
|
| 86 |
|
|
| 4,812 |
|
Subtotal |
|
| 135,800 |
|
|
| 110,861 |
|
|
| 1,910 |
|
|
| 23,029 |
|
|
| 92,243 |
|
|
| 68,548 |
|
|
| 1,656 |
|
|
| 22,039 |
|
Goodwill and intangible assets, net |
|
| 33,836 |
|
|
| — |
|
|
| — |
|
|
| 33,836 |
|
|
| 33,723 |
|
|
| — |
|
|
| — |
|
|
| 33,723 |
|
Total assets |
| $ | 169,636 |
|
| $ | 110,861 |
|
| $ | 1,910 |
|
| $ | 56,865 |
|
| $ | 125,966 |
|
| $ | 68,548 |
|
| $ | 1,656 |
|
| $ | 55,762 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued compensation and benefits |
| $ | 2,343 |
|
| $ | — |
|
| $ | — |
|
| $ | 2,343 |
|
| $ | 1,408 |
|
| $ | — |
|
| $ | — |
|
| $ | 1,408 |
|
Accounts payable and accrued liabilities |
|
| 1,402 |
|
|
| — |
|
|
| — |
|
|
| 1,402 |
|
|
| 1,324 |
|
|
| — |
|
|
| — |
|
|
| 1,324 |
|
Borrowings |
|
| 6,474 |
|
|
| — |
|
|
| — |
|
|
| 6,474 |
|
|
| 6,635 |
|
|
| — |
|
|
| — |
|
|
| 6,635 |
|
Separate account liabilities and collateral liabilities under securities lending agreements |
|
| 110,861 |
|
|
| 110,861 |
|
|
| — |
|
|
| — |
|
|
| 68,548 |
|
|
| 68,548 |
|
|
| — |
|
|
| — |
|
Deferred income tax liabilities(4) |
|
| 3,659 |
|
|
| — |
|
|
| — |
|
|
| 3,659 |
|
|
| 2,801 |
|
|
| — |
|
|
| — |
|
|
| 2,801 |
|
Operating lease liabilities |
|
| 1,946 |
|
|
|
|
|
|
|
|
|
|
| 1,946 |
|
|
| 1,815 |
|
|
| — |
|
|
| — |
|
|
| 1,815 |
|
Other liabilities |
|
| 4,585 |
|
|
| — |
|
|
| 435 |
|
|
| 4,150 |
|
|
| 5,130 |
|
|
| — |
|
|
| 507 |
|
|
| 4,623 |
|
Total liabilities |
|
| 131,270 |
|
|
| 110,861 |
|
|
| 435 |
|
|
| 19,974 |
|
|
| 87,661 |
|
|
| 68,548 |
|
|
| 507 |
|
|
| 18,606 |
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total BlackRock, Inc. stockholders’ equity |
|
| 36,817 |
|
|
| — |
|
|
| — |
|
|
| 36,817 |
|
|
| 37,089 |
|
|
| — |
|
|
| — |
|
|
| 37,089 |
|
Noncontrolling interests |
|
| 1,549 |
|
|
| — |
|
|
| 1,475 |
|
|
| 74 |
|
|
| 1,216 |
|
|
| — |
|
|
| 1,149 |
|
|
| 67 |
|
Total equity |
|
| 38,366 |
|
|
| — |
|
|
| 1,475 |
|
|
| 36,891 |
|
|
| 38,305 |
|
|
| — |
|
|
| 1,149 |
|
|
| 37,156 |
|
Total liabilities and equity |
| $ | 169,636 |
|
| $ | 110,861 |
|
| $ | 1,910 |
|
| $ | 56,865 |
|
| $ | 125,966 |
|
| $ | 68,548 |
|
| $ | 1,656 |
|
| $ | 55,762 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Amounts represent segregated client assets and related liabilities, in which BlackRock has no economic interest. BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients. |
(2) | Amounts represent the |
(3) |
|
(4) |
|
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 SeptemberJune 30, 20212022 and December 31, 20202021 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 SeptemberJune 30, 20212022 and December 31, 20202021 included $265$318 million and $206$308 million, respectively, of cash held by CIPs (see Liquidity and Capital Resources for details on the change in cash and cash equivalents during the ninesix months ended SeptemberJune 30, 2021)2022).
Accounts receivable at SeptemberJune 30, 2021 increased $4802022 decreased $318 million from December 31, 2020,2021, primarily due to higherlower base and performance fee receivables, partially offset by an increase in technology services receivables. Investments, including the impact ofheld by CIPs, increased $182$40 million from December 31, 20202021 (for more information see Investments herein). Goodwill and intangible assets increased $1,022decreased $81 million from December 31, 2020,2021, primarily due to the Aperio Transaction, partially offset by amortization of intangible assets. Operating lease right-of-use (“ROU”) Other assets at September 30, 2021 increased $1.1$1.4 billion from December 31, 2020 (substantially offset by an increase in operating lease liabilities),2021, 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 other liabilities), an increase in current taxes receivable and an increase in strategic minority investments..
Liabilities. Accrued compensation and benefits at SeptemberJune 30, 20212022 decreased $156 million$1.5 billion from December 31, 2020,2021, primarily due to 20202021 incentive compensation cash payments in the first quarter of 2021,2022, partially offset by 20212022 incentive compensation accruals. Accounts payable and accrued liabilities at SeptemberJune 30, 2021 increased $3742022 decreased $73 million from December 31, 2020, primarily due to increased accruals. Operating lease liabilities2021. Borrowings at SeptemberJune 30, 2021 increased $1,1912022 decreased $811 million from December 31, 2020 (substantially offset by an increase in ROU assets),2021, primarily relateddue to the leaserepayments of office space for the Company’s future headquarters described above.borrowings of $750 million. Other liabilities increased $1,648 million$1.1 billion from December 31, 2020,2021, primarily due to higher unit trust payables (substantially offset by an increase in unit trust receivables recorded within other assets), and higher other liabilities ofheld by CIPs, including deferred carried interest liabilities. Net deferred income tax liabilities at SeptemberJune 30, 2021 decreased $142022 increased $43 million from December 31, 2020,2021, primarily due to the effects of temporary differences associated with capitalized costs,stock-based compensation partially offset by the Aperio Transaction, revaluation of certain deferred income tax liabilities due to tax legislation enacted in the UK andunrealized investment income.losses.
Investments
The Company’s investments were $7,101 million and $6,919 million$7.3 billion at Septemberboth June 30, 20212022 and December 31, 2020, respectively.2021. Investments include consolidated investments held by CIPs accounted for as VREsVIEs and VIEs.VREs. Management reviews BlackRock’s investments on an “economic” basis, which eliminates the portion of 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 investments, as adjusted, to enable investors to understand the portion of 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 hedged investments, to reflect another helpful measure for investors. 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, |
|
| June 30, |
|
| December 31, |
| ||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Investments, GAAP |
| $ | 7,101 |
|
| $ | 6,919 |
|
| $ | 7,302 |
|
| $ | 7,262 |
|
Investments held by CIPs |
|
| (4,574 | ) |
|
| (4,976 | ) |
|
| (4,554 | ) |
|
| (4,623 | ) |
Net interest in CIPs(1) |
|
| 3,025 |
|
|
| 2,490 |
|
|
| 3,302 |
|
|
| 3,391 |
|
Investments, as adjusted |
|
| 5,552 |
|
|
| 4,433 |
|
|
| 6,050 |
|
|
| 6,030 |
|
Federal Reserve Bank stock |
|
| (95 | ) |
|
| (94 | ) |
|
| (90 | ) |
|
| (96 | ) |
Deferred compensation investments |
|
| — |
|
|
| (6 | ) | ||||||||
Hedged investments |
|
| (801 | ) |
|
| (833 | ) |
|
| (651 | ) |
|
| (720 | ) |
Carried interest |
|
| (1,446 | ) |
|
| (627 | ) |
|
| (1,644 | ) |
|
| (1,555 | ) |
Total “economic” investment exposure(2) |
| $ | 3,210 |
|
| $ | 2,873 |
|
| $ | 3,665 |
|
| $ | 3,659 |
|
(1) | Amounts |
(2) | Amounts exclude |
The following table represents the carrying value of the Company’s economic investment exposure, by asset type, at SeptemberJune 30, 20212022 and December 31, 2020:2021:
|
| September 30, |
|
| December 31, |
|
| June 30, |
|
| December 31, |
| ||||
(in millions) |
| 2021 |
|
| 2020 |
|
| 2022 |
|
| 2021 |
| ||||
Equity(1) |
| $ | 1,051 |
|
| $ | 835 |
|
| $ | 1,252 |
|
| $ | 1,352 |
|
Fixed income(2) |
|
| 758 |
|
|
| 958 |
|
|
| 602 |
|
|
| 600 |
|
Multi-asset(3) |
|
| 80 |
|
|
| 127 |
|
|
| 107 |
|
|
| 125 |
|
Alternatives: |
|
| — |
|
|
|
|
|
|
|
|
|
|
|
|
|
Private equity |
|
| 746 |
|
|
| 418 |
|
|
| 980 |
|
|
| 960 |
|
Real assets |
|
| 256 |
|
|
| 251 |
|
|
| 312 |
|
|
| 279 |
|
Other alternatives(4) |
|
| 319 |
|
|
| 284 |
|
|
| 412 |
|
|
| 343 |
|
Alternatives subtotal |
|
| 1,321 |
|
|
| 953 |
|
|
| 1,704 |
|
|
| 1,582 |
|
Total “economic” investment exposure |
| $ | 3,210 |
|
| $ | 2,873 |
|
| $ | 3,665 |
|
| $ | 3,659 |
|
(1) | Equity includes unhedged seed investments in equity mutual funds/strategies and equity securities. |
(2) | Fixed income includes unhedged seed investments in fixed income mutual funds/strategies, 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 primarily include co-investments in direct hedge fund strategies and hedge fund solutions. |
As adjusted investment activity for the ninesix months ended SeptemberJune 30, 20212022 was as follows:
(in millions) | Nine Months Ended September 30, 2021 |
| Six Months Ended June 30, 2022 |
| ||
Investments, as adjusted, beginning balance | $ | 4,433 |
| $ | 6,030 |
|
Purchases/capital contributions |
| 1,096 |
|
| 702 |
|
Sales/maturities |
| (970 | ) |
| (320 | ) |
Distributions(1) |
| (147 | ) |
| (78 | ) |
Market appreciation(depreciation)/earnings from equity method investments |
| 376 |
|
| (291 | ) |
Carried interest capital allocations/(distributions) |
| 819 |
|
| 89 |
|
Other(2) |
| (55 | ) |
| (82 | ) |
Investments, as adjusted, ending balance | $ | 5,552 |
| $ | 6,050 |
|
(1) Amount includes distributions representing return of capital and return on investments.
(2) Amount includes the impact of foreign exchange movements.
LIQUIDITY AND CAPITAL RESOURCES
BlackRock Cash Flows Excluding the Impact of CIPs
The condensed consolidated statements of cash flows include the cash flows of the CIPs. The Company uses an adjusted cash flow statement, which excludes the impact of 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 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 CIPs:
(in millions) | GAAP Basis |
|
| Impact on Cash Flows of CIPs |
|
| Cash Flows Excluding Impact of CIPs |
| 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 |
| ||||||||||||||
Cash, cash equivalents and restricted cash, December 31, 2021 | $ | 9,340 |
|
| $ | 308 |
|
| $ | 9,032 |
| |||||||||||||
Net cash provided by/(used in) operating activities |
| 3,027 |
|
|
| (963 | ) |
| 3,990 |
|
| 1,223 |
|
|
| (415 | ) |
|
| 1,638 |
| |||
Net cash provided by/(used in) investing activities |
| (1,579 | ) |
|
| (59 | ) |
| (1,520 | ) |
| (500 | ) |
|
| (5 | ) |
|
| (495 | ) | |||
Net cash provided by/(used in) financing activities |
| (2,695 | ) |
|
| 1,081 |
| (3,776 | ) |
| (3,272 | ) |
|
| 430 |
|
|
| (3,702 | ) | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
| (56 | ) |
|
| — |
|
| (56 | ) |
| (293 | ) |
|
| — |
|
|
| (293 | ) | |||
Net increase/(decrease) in cash, cash equivalents and restricted cash |
| (1,303 | ) |
|
| 59 |
|
| (1,362 | ) |
| (2,842 | ) |
|
| 10 |
|
|
| (2,852 | ) | |||
Cash, cash equivalents and restricted cash, September 30, 2021 | $ | 7,378 |
|
| $ | 265 |
|
|
|
| $ | 7,113 |
| |||||||||||
Cash, cash equivalents and restricted cash, June 30, 2022 | $ | 6,498 |
|
| $ | 318 |
|
| $ | 6,180 |
|
Sources of BlackRock’s operating cash primarily include base fees and securities lending revenue, performance fees, technology services revenue, advisory and other revenue and distribution fees. BlackRock uses its cash to pay all operating 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 of cash flows contained in Part I, Item 1 of this filing.
Cash flows provided by/(used in) operating activities, excluding the impact of CIPs, primarily include the receipt of base fees, securities lending revenue, and performance fees and technology services revenue, offset by the payment of operating expenses incurred in the normal course of business, including year-end incentive and deferred compensation accrued for in theduring prior year.years, and income tax payments.
Cash flows used in investing activities, excluding the impact of CIPs, for the ninesix months ended SeptemberJune 30, 20212022 were $1.5 billion$495 million and primarily reflected $1.1 billion of cash outflows related to the Aperio Transaction, $285$266 million of net investment purchases and $215$263 million of purchases of property and equipment, partially offset by $77 million of distributions of capital from equity method investees.equipment.
Cash flows used in financing activities, excluding the impact of CIPs, for the ninesix months ended SeptemberJune 30, 20212022 were $3.8$3.7 billion, primarily resulting from $1.9$1.5 billion of cash dividend payments, and $1.2$1.4 billion of share repurchases, including $900 million$1 billion in open market transactions and $282 million$0.4 billion of employee tax withholdings related to employee stock transactions, and $750 million$0.8 billion of repayments of long-term borrowings.
The Company manages its financial condition and funding to maintain appropriate liquidity for the business. Management believes that the Company’s liquid assets, continuing cash flows from operations, borrowing capacity under the Company’s existing revolving credit facility and uncommitted commercial paper private placement program, provide sufficient resources to meet the Company’s short-term and long-term cash needs, including operating, debt and other obligations as they come due and anticipated future capital requirements. Liquidity resources at SeptemberJune 30, 20212022 and December 31, 20202021 were as follows:
| September 30, |
|
| December 31, |
| June 30, |
|
| December 31, |
| ||||
(in millions) | 2021 |
|
| 2020 |
| 2022 |
|
| 2021 |
| ||||
Cash and cash equivalents | $ | 7,361 |
|
| $ | 8,664 |
| $ | 6,481 |
|
| $ | 9,323 |
|
Cash and cash equivalents held by CIPs |
| (265 | ) |
|
| (206 | ) |
| (318 | ) |
|
| (308 | ) |
Subtotal |
| 7,096 |
|
|
| 8,458 |
|
| 6,163 |
|
|
| 9,015 |
|
Credit facility – undrawn |
| 4,400 |
|
|
| 4,000 |
|
| 4,700 |
|
|
| 4,400 |
|
Total liquidity resources | $ | 11,496 |
|
| $ | 12,458 |
| $ | 10,863 |
|
| $ | 13,415 |
|
|
|
|
|
|
|
|
|
(1) |
|
| The Company cannot readily access such cash and cash equivalents to use in its operating activities. |
(2) | The percentage of cash and cash equivalents held by the Company’s US subsidiaries was approximately 45% and 50% at June 30, 2022 and December 31, 2021, respectively. See Net Capital Requirements herein for more information on net capital requirements in certain regulated subsidiaries. |
Total liquidity resources decreased $962 million$2.6 billion during the ninesix months ended SeptemberJune 30, 2021,2022, primarily reflecting cash payments of 20202021 year-end incentive awards, cash dividend payments of $1.9$1.5 billion, share repurchases of $1.2$1.4 billion approximately $1.1and $0.8 billion of cash outflow related to the Aperio Transaction and repayments of borrowings, of $750 million, partially offset by cash flows from other operating activities and a $400$300 million increase in the aggregate commitment amount ofunder the credit facility.
A significant portion of the Company’s $5,552 million$6.1 billion of investments, as adjusted, is illiquid in nature and, as such, cannot be readily convertible to cash.
Share Repurchases. During the ninesix months ended SeptemberJune 30, 2021,2022, the Company repurchased 1.1approximately 1.4 million of common shares under the Company’s existing share repurchase program for approximately $900 million.$1 billion. At SeptemberJune 30, 2021,2022, there were 3.9approximately 2.2 million shares still authorized to be 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 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 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 SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company was required to maintain approximately $2.4$2.2 billion and $2.2$2.3 billion respectively, in net capital in certain regulated subsidiaries, including BTC, entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the UK,United Kingdom, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.
Short-Term Borrowings
20212022 Revolving Credit Facility. Since 2011, the Company has maintained an unsecured revolving credit facility which is available for working capital and general corporate purposes (the “2022 credit facility”). In March 2021,2022, the Company’s2022 credit facility was amended to, among other things, (i) increase the aggregate commitment amount by $300 million to $4.4$4.7 billion, and to(ii) extend the maturity date to March 2026 (the “2021 credit facility”). In addition,2027, (iii) change 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 onfor borrowings outstanding accrues atdenominated in US dollars from a rate based on the applicable London Interbank Offered Rate (“LIBOR”) to a rate based on the secured overnight financing rate (“SOFR”) subject to certain adjustments and (iv) raise and/or an applicable replacement benchmark, plus a spread.add certain specified targets for the sustainability-linked pricing mechanics. The 20212022 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasingwhich could increase the overall size of the 20212022 credit facility to an aggregate principal amount notof up to exceed $5.4$5.7 billion. The 20212022 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 SeptemberJune 30, 2021. The 2021 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities.2022. At SeptemberJune 30, 2021,2022, the Company had no amount outstanding under the 20212022 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 billion. The commercial paper program is currently supported by the 20212022 credit facility. At SeptemberJune 30, 2021,2022, BlackRock had no CP Notes outstanding.
Long-Term Borrowings
Long-term Notes.At SeptemberJune 30, 2021,2022, the principal amount of long-term borrowingsnotes outstanding was $6.5$6.7 billion. See Note 15, BorrowingsBorrowings, in the 20202021 Form 10-K for more information on overall borrowings outstanding as of December 31, 2020.2021.
In June 2022, the Company fully repaid $750 million of 3.375% notes at maturity.
During the ninesix months ended SeptemberJune 30, 2021,2022, the Company paid approximately $148$95 million of interest on long-term borrowings.notes. Future principal repayments and interest requirements at SeptemberJune 30, 20212022 were as follows:
(in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year |
| Principal |
|
| Interest |
|
| Total Payments |
|
| Principal |
|
| Interest |
|
| Total Payments |
| ||||||
Remainder of 2021 |
| $ | — |
|
| $ | 41 |
|
| $ | 41 |
| ||||||||||||
2022 |
|
| 750 |
|
|
| 161 |
|
|
| 911 |
| ||||||||||||
Remainder of 2022 |
| $ | — |
|
| $ | 79 |
|
| $ | 79 |
| ||||||||||||
2023 |
|
| — |
|
|
| 148 |
|
|
| 148 |
|
|
| — |
|
|
| 168 |
|
|
| 168 |
|
2024 |
|
| 1,000 |
|
|
| 131 |
|
|
| 1,131 |
|
|
| 1,000 |
|
|
| 151 |
|
|
| 1,151 |
|
2025(1) |
|
| 811 |
|
|
| 113 |
|
|
| 924 |
|
|
| 732 |
|
|
| 133 |
|
|
| 865 |
|
2026 |
|
| — |
|
|
| 103 |
|
|
| 103 |
|
|
| — |
|
|
| 124 |
|
|
| 124 |
|
2027 |
|
| 700 |
|
|
| 113 |
|
|
| 813 |
| ||||||||||||
Thereafter |
|
| 3,950 |
|
|
| 283 |
|
|
| 4,233 |
|
|
| 4,250 |
|
|
| 286 |
|
|
| 4,536 |
|
Total |
| $ | 6,511 |
|
| $ | 980 |
|
| $ | 7,491 |
|
| $ | 6,682 |
|
| $ | 1,054 |
|
| $ | 7,736 |
|
__________________________
(1) | The |
In May 2021, the Company fully repaid $750 million of 4.25% notes at maturity.
Commitments and Contingencies
Investment Commitments. At SeptemberJune 30, 2021,2022, the Company had $905$806 million of various capital commitments to fund sponsored investment products, including CIPs. These products include various illiquid alternative products, including private equity funds and 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.
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 from acquired contracts. The fair value of the remaining aggregate contingent payments at September 30, 2021 totaled $62 million and is included in other liabilities on the condensed consolidated statements of financial condition.
Carried Interest Clawback. As a general partner in certain investment 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 investments, or cash and cash equivalents to the extent that it is distributed, and as a deferred carried interest liability on its condensed consolidated statements of financial condition. Carried interest is recorded as performance fees on BlackRock’s condensed consolidated statements of income when fees are no longer probable of 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 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. The amount of securities on loan as of September 30, 2021 and subject to this type of indemnification was $279 billion. In the Company’s capacity as lending agent, cash and securities totaling $299 billion were held as collateral for indemnified securities on loan at September 30, 2021. The fair value of these indemnifications was not material at September 30, 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 And Estimates
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. These estimates, judgments and assumptions are affected by the Company’s application of accounting policies. Management considers the following critical accounting policies importantand estimates critical to understanding the condensed consolidated financial statements. These policies and estimates are considered critical because they had a material impact, or are reasonably likely to have a material impact on the Company’s condensed consolidated financial statements and because they require management to make significant judgments, assumptions or estimates. For a summary of these and additional accounting policies, see Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements. In addition, see Critical Accounting Policies and Estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 2, Significant Accounting Policies, in the 20202021 Form 10-K for further information.
Consolidation. In the normal course of business,The Company consolidates entities in which the Company ishas a controlling financial interest. The company has a controlling financial interest when it owns a majority of the manager of various types of sponsored investment vehicles. The Company performs an analysis for investment products to determine if the productVRE or is a VIE orprimary beneficiary (“PB”) of a VRE.VIE. Assessing whether an entity is a VIE or a VRE involves judgment and analysis.analysis on a structure-by-structure basis. Factors considered in this assessment include the entity’s legal organization, the entity’s capital structure and equity ownership, the rights of equity investment holders, the Company’s contractual involvement with and economic interest in the entity and any related party or de facto agent implications of the Company’s involvement with the entity. InvestmentsEntities 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. InvestmentsEntities that are determined to be VIEs are consolidated if the Company is the primary beneficiary (“PB”)PB of the entity. BlackRock is deemed to be the PB of a VIE if it a) has the power to direct the activities that most significantly impact the entities’entity’s economic performance and b) has the obligation to absorb losses or the right to receive benefits that potentially could be significant to the VIE. There is judgment involved in assessing whether the Company is the PB of a VIE. In addition, the Company’s ownership interest in VIEs is subject to variability and is impacted by actions of other investors such as on-going redemptions and contributions. The Company generally consolidates VIEs in which it holds an economic interest of 10% or greater and deconsolidates such VIEs once equity ownership falls below 10%. As of June 30, 2022, the Company was deemed to be the PB of 80 VIEs. See Note 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 MeasurementsMeasurements.. 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, and Note 8, Fair Value Disclosures, 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, including incentive allocations (carried interest) from certain actively managed investment funds and certain SMAs. These performance fees are dependent upon exceeding specified relative or absolute investment return thresholds, which may vary by product or account, and include monthly, quarterly, annual or 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 ofinvestment performance exceeds a contractual threshold at 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 judgementjudgment 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 feesamounts are dependent on the marketfinancial markets and, thus, are highly susceptible to factors outside the Company’s influence; (2) the feesultimate payments have a large number and a broad range of possible amounts; and (3) the funds or SMAs have the ability to a) invest or reinvest their sales proceeds.proceeds or b) distribute their sales proceeds and determine the timing of such distributions.
The Company is allocatedallocated/distributed carried interest from certain alternative investment products upon exceeding performance thresholds. The Company may be required to reverse/return all, or part, of such carried interest allocations/distributions depending upon future performance of these products. Carried interest subject to such clawback provisions is recorded in investments or cash and cash equivalents to the extent that it is distributed, on its condensed consolidated statements of financial condition.
The Company records a liability for deferred carried interest to the extent it receives cash or capital allocations related to carried interest prior to meeting the revenue recognition criteria. At SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had $1.3$1.6 billion and $584 million,$1.5 billion, respectively, of deferred carried interest recorded in other liabilities on the condensed consolidated statements of financial condition. A portion of the deferred carried interest 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. See Note 16, Revenue, in the notes to the condensed consolidated financial statements for detailed changes in the deferred carried interest liability balance for the three and ninesix months ended SeptemberJune 30, 20212022 and 2020.
2021.
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 assets under management (“AUM”)AUM and, in some cases, performance fees expressed as a percentage of the returns realized on AUM. At SeptemberJune 30, 2021,2022, the majority of the Company’s baseinvestment advisory and administration 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 baseinvestment advisory and administration 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 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 SeptemberJune 30, 2021,2022, the Company had outstanding total return swaps with an aggregate notional value of approximately $801$651 million.
At SeptemberJune 30, 2021,2022, approximately $4.6 billion of BlackRock’s investments were maintained in consolidated sponsored investment products accounted for as variable interest entities andor voting rights entities. Excluding the impact of the Federal Reserve Bank stock, carried interest and certain investments that are hedged via the seed capital hedging program, the Company’s economic exposure to its investment portfolio is $3.2$3.7 billion. See Statement of Financial Condition Overview-Investments in Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information on the Company’s investments.
Equity Market Price Risk. At SeptemberJune 30, 2021,2022, the Company’s net exposure to equity market price risk in its investment portfolio was approximately $1,582 million$1.9 billion 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 $158$189 million in the carrying value of such investments.
Interest Rate/Credit Spread Risk. At SeptemberJune 30, 2021,2022, the Company was exposed to interest-rateinterest rate risk and credit spread risk as a result of approximately $1,628 million$1.8 billion of 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 $29$34 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 $912$190 million at SeptemberJune 30, 2021.2022. A 10% adverse change in the applicable foreign exchange rates would result in approximately a $91$79 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 SeptemberJune 30, 2021,2022, the Company had outstanding forward foreign currency exchange contracts with an aggregate notional value of approximately $2.2$1.7 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 SeptemberJune 30, 20212022 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
The following discussion supplementsIn addition to the discussion of risk factors previously disclosedother information set forth in BlackRock’sthis report, the risks discussed 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 adversely2021 could materially affect BlackRock’sour business, operations and financial condition, which may cause its AUM, revenueoperating results and earnings to decline.
Towards the end of the first quarter of 2020, the pandemic began to impact BlackRock’s business. While global markets have significantly recovered since then, the effects of the pandemic are ongoing and could be prolonged or worsen and have an ongoing adverse impact on BlackRock’s business, including its operations and financial condition, as a result of, among other things:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The aggregate extent to which COVID-19, and the related impact on the global economy, 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 pandemic and any recovery period, the emergence and spread of variants of the COVID-19 virus, the continuing prevalence of severe, unconstrained and/or 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 the pandemic, and the effects of the COVID-19 pandemic on BlackRock’s products, clients, vendors and employees. Moreover, the effects of 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 subsequent reports filed with the Securities and Exchange Commission.nonoperating results.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the three months ended SeptemberJune 30, 2021,2022, 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(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 |
|
|
|
|
|
|
| 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 |
| ||||
April 1, 2022 through April 30, 2022 |
|
| 244,499 |
|
|
| $ | 673.67 |
|
|
| 240,693 |
|
|
| 2,751,725 |
|
May 1, 2022 through May 31, 2022 |
|
| 501,929 |
|
|
| $ | 618.71 |
|
|
| 499,140 |
|
|
| 2,252,585 |
|
June 1, 2022 through June 30, 2022 |
|
| 47,502 |
|
|
| $ | 675.22 |
|
|
| 43,940 |
|
|
| 2,208,645 |
|
Total |
|
| 793,930 |
|
|
| $ | 639.02 |
|
|
| 783,773 |
|
|
|
|
|
_______________________
(1) | Consists of 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 |
|
|
|
|
| |
|
| |
| ||
|
|
|
31.1 |
| |
|
|
|
31.2 |
| |
|
|
|
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 |
|
|
|
104 |
| Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
(1) | Incorporated by reference to BlackRock’s Current Report on Form 8-K filed on |
|
|
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: |
|
| Gary S. Shedlin |
|
|
| Senior Managing Director & Chief Financial Officer (Principal Financial Officer) |
8173