UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR/A

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-02631

Chestnut Street Exchange Fund
(Exact name of registrant as specified in charter)

103 Bellevue Parkway
Wilmington, DE 19809
(Address of principal executive offices) (Zip code)

Edward J. Roach
Chestnut Street Exchange Fund
103 Bellevue Parkway
Wilmington, DE 19809
(Name and address of agent for service)

Registrant's telephone number, including area code: (302) 791-1112

Date of fiscal year end: December 31

Date of reporting period: December 31, 2010

This Amendment No. 1 on Form N-CSR/A ("Amendment") is being filed to revise the
line graph on page 5 in the Annual Report which was filed March 4, 2011
(Accession Number 0000950123-11-022186).

ITEM 1. REPORTS TO STOCKHOLDERS.

The Report to Shareholders is attached herewith.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

David R. Wilmerding, Jr.
Chairman

January 31, 2011

Fellow Partner:

Enclosed is the Annual Report of Chestnut Street Exchange Fund for the year
ended December 31, 2010.

Our Fund earned $5.79 per share of net investment income for a share
outstanding throughout 2010, compared to $6.28 per share earned in 2009.
Dividend income in 2010 was reduced by $723,000 from 2009, largely from
liquidations of partnership shares and expenses increased by $36,000, primarily
advisor fees.

After providing for the January 2011 distribution, the net asset value per
partnership share at December 31, 2010 was $344.85. The net asset value at
September 30, 2010, the date of our last report, was $312.60.

Additions to the portfolio in the fourth quarter were 22,300 shares of
Check Point Software Technologies Ltd., and 31,500 shares of Oracle Corp. Our
holdings in Pitney Bowes, Inc. were sold. Distributed in redemption were shares
of Intel Corp. and 3M Co.

Additional information required by Securities and Exchange Commission
regulations is enclosed.

The accompanying Investment Adviser's Report contains interesting
information on the market generally and on our Fund's performance.

Your comments or questions concerning Chestnut Street Exchange Fund are
welcomed.

Yours sincerely,

/s/ David R. Wilmerding, Jr.

David R. Wilmerding, Jr.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

INVESTMENT ADVISER'S REPORT

MARKET REVIEW

The outcome of the US mid-term election, the long-anticipated announcement
of additional purchases of US Treasuries by the Federal Reserve (QE2), and the
improved economic news flow helped ease investors' fear of a double-dip
recession, underpinning a strong equity market rally in the last quarter of
2010. The shift in investor psychology eclipsed ongoing concerns regarding
weakness in the housing market and the labor market, which despite marginal
improvement remains problematic. All barometers of stock market performance
ended the year strongly.

Cyclical themes played out well during the quarter, leading to a strong
finish for the year in sectors such as materials, industrials, and consumer
discretionary, the strongest performers among the ten major sectors. Commodities
and consumer discretionary stocks, particularly auto-related and internet
retailers, advanced strongly on the back of improved data. Defensive sectors,
such as utilities, healthcare, and telecommunication services that performed
strongly in the third quarter had more modest performance in the fourth quarter,
but were all in positive territory for the year and the quarter. Last year,
growth stocks marginally outperformed value stocks, but more dramatic
differences occurred amid market capitalizations, with midcap stocks
significantly outperforming their large-cap counterparts.

With the dawn of a new year, the outlook is typically in the forefront of
investors' minds. Economic expectations have shifted upward on the back of the
Federal Reserve's quantitative easing program and Congressional passage of the
Bush-era tax cuts extension. While fixed income markets experienced a
late-quarter rate rise, we believe that there is further upside potential for
equities given the strong position of corporate balance sheets and the reduction
in downside risk. The risk to this outlook may be continued stresses in the
labor and housing markets. However, we believe that an economic environment of
low domestic inflation and slow-to-moderate growth is probably the most likely
scenario going forward, and this should provide tailwinds for the stock market

On the corporate side, balance sheets remain strong and elevated cash
positions should lead to dividend payments/increases, share buy backs, merger
and acquisition activity, and business reinvestment. In this context, we foresee
higher quality economic growth and resultant higher GDP. In addition, improved
consumer and business confidence, if maintained, along with a less hostile
capital markets attitude from Washington DC, and the favorable earnings yield
comparisons of equities relative to bond yields are some reasons to expect that
2011 should be another favorable year for risk assets, such as equities.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

INVESTMENT ADVISER'S REPORT (CONTINUED)

PORTFOLIO REVIEW

SUMMARY

The US equity market continued its recovery that began in March 2009 and
during the first part of 2010, before struggling during the summer months. The
European sovereign debt crisis combined with weaker economic data elevated fears
of a double-dip recession in the United States. Beginning in September, the
market rallied into year-end on improving economic data combined with major
developments in Washington, D.C. These catalysts for US equities included: a
commitment by the Federal Reserve to further loosen monetary policy with large
scale asset purchases, the Republicans' winning control of the House of
Representatives in the November election, and the stimulative bi-partisan tax
agreement reached in December. The S&P 500 Index closed the year 15.1% higher,
while the Russell 1000 Growth rose 16.7%. Small cap stocks fared even better,
with the Russell 2000 Index riding the year-end rally to a gain of 26.9%

The Chestnut Street Exchange Fund delivered a double-digit return for the
second consecutive year, but underperformed the 15.1% return posted by the S&P
500 Index. Stock selection in health care and information technology led to the
negative relative performance, and overshadowed positive stock selection in
consumer staples.

PERFORMANCE ATTRIBUTION

Stock selection in the health care sector generated notable
underperformance for the Fund in 2010. The Fund's large investment in the
pharmaceuticals industry accounted for much of the weakness. The sector
continues to face major patent expirations over the next several years, leading
investors to be cautious. In addition prescription volumes have been negatively
impacted by the recession. Large investments in both Abbott Laboratories and
Johnson & Johnson Inc. detracted from returns as both stocks declined during the
period. In addition, the health care sector was the worst performing sector
within the S&P 500 Index in 2010, and the Fund's overweight in the sector
negatively impacted the portfolio.

In information technology, the Fund's large investment in Intel Corp.
detracted from performance. The stock rose 6% during the year, but could not
match the 10% return of the semiconductor holdings within the S&P 500 Index. We
continue to reduce the size of the position to create greater diversification.
Hewlett-Packard Co. delivered disappointing performance in the second half of
the year following the removal of the company's highly-respected CEO.

Stock selection in the consumer staples sector benefitted the portfolio in
2010. The Fund's large investment in Coca-Cola Co. added the most value, with
the stock rising more than 19% on the year. The company is heavily exposed to
emerging market growth, and continues to take market share from PepsiCo Inc.,
which is a much smaller holding in the portfolio. In addition, the Fund's small
position in Sara Lee Corp. also produced outperformance, as the stock surged
more than 48%.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

INVESTMENT ADVISER'S REPORT (CONTINUED)

PORTFOLIO REVIEW (CONCLUDED)

OUTLOOK

As a result of market movement and individual trades made during the year,
the Fund's weightings in financials and consumer staples increased at the
expense of health care. We used investor redemptions to further diversify the
portfolio and reduce investments in Intel Corp., Merck & Co. Inc. and Johnson &
Johnson. We also eliminated the Fund's investments in BP PLC, Pitney Bowes Inc.
and Frontier Communications Corp. In order to maintain the weighting in
technology following the reduction in Intel Corp., we added to the investments
in Oracle Corp. and Checkpoint Software Technologies Ltd. The Fund remains
highly diversified, with the largest weightings in the information technology,
industrials, health care, and financials sectors. Relative to the S&P 500, the
Fund holds significant overweights in health care and industrials, and notable
underweights in consumer discretionary and utilities.

ANY OPINIONS EXPRESSED ARE THOSE OF BLACKROCK AS OF THE DATE OF THIS REPORT AND
ARE SUBJECT TO CHANGE BASED ON CHANGES IN MARKET OR ECONOMIC CONDITIONS. PAST
PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. THERE IS NO GUARANTEE THAT
FORECASTS MADE HEREIN WILL COME TO PASS. THE COMMENTS SHOULD NOT BE CONSTRUED AS
A RECOMMENDATION FOR ANY INDIVIDUAL HOLDINGS OR MARKET SECTORS. INFORMATION AND
OPINIONS ARE DERIVED FROM PROPRIETARY AND NON-PROPRIETARY SOURCES DEEMED BY
BLACKROCK TO BE RELIABLE. WE CANNOT GUARANTEE THE ACCURACY OF SUCH INFORMATION,
ASSURE ITS COMPLETENESS, OR WARRANT THAT SUCH INFORMATION WILL NOT BE CHANGED
WITHOUT NOTICE. RELIANCE UPON INFORMATION IN THIS REPORT IS AT THE SOLE
DISCRETION OF THE READER.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

INVESTMENT ADVISER'S REPORT (CONCLUDED)

(UNAUDITED)

PERFORMANCE COMPARISON

COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN CHESTNUT STREET

EXCHANGE FUND(1) VS. S&P 500(R) INDEX AND DOW JONES INDUSTRIAL AVERAGE INDEX(2)

(PERFORMANCE GRAPH)

S&P Value DJIA Value Chestnut Street
--------- ---------- ---------------

12/31/2000 10,000.00 10,000.00 10,000
Jan. 31, 2001 10355 10102 10206
Feb. 28 2001 9410.62 9760.55 9438
Mar. 31 2001 8813.99 9195.42 8846
Apr. 30 2001 9498.84 10000.9 9524
May 31 2001 9562.48 10191 9433
Jun. 30 2001 9330.11 9814.91 9294
Jul. 31 2001 9238.23 9845.33 9390
Aug. 31 2001 8659.92 9334.36 9112
Sept. 30 2001 7960.19 8306.65 8440
Oct. 31 2001 8112.23 8530.1 8688
Nov. 30 2001 8734.44 9285.86 9519
Dec. 31 2001 8811.31 9455.79 9495
Jan. 31 2002 8682.66 9369.75 9483
Feb. 28 2002 8515.08 9567.45 9226
Mar. 31 2002 8835.25 9858.3 9614
Apr. 30 2002 8299.57 9433.41 9197
May 31 2002 8238.15 9440.01 9186
Jun. 30 2002 7651.6 8801.86 8025
Jul. 31 2002 7055.54 8330.08 7822
Aug. 31 2002 7102.1 8280.94 7736
Sept. 30 2002 6330.11 7266.52 6972
Oct. 31 2002 6887.16 8054.21 7639
Nov. 30 2002 7292.81 8557.6 8099
Dec. 31 2002 6863.99 8036.44 7477
Jan. 31 2003 6684.15 7768.83 7338
Feb. 28 2003 6583.89 7634.43 7300
Mar. 31 2003 6647.76 7743.6 7387
Apr. 30 2003 7195.53 8228.35 7872
May 31 2003 7574.74 8616.73 8168
Jun. 30 2003 7671.69 8760.63 8202
Jul. 31 2003 7806.71 9016.44 8443
Aug. 31 2003 7958.95 9216.6 8626
Sep. 30 2003 7874.58 9091.26 8544
Oct. 31 2003 8320.28 9624.91 8980
Nov. 30 2003 8393.5 9632.61 8982
Dec. 31 2003 8833.32 10308.8 9355
Jan. 31 2004 8995.45 10356.2 9421
Feb. 29 2004 9120.48 10474.3 9433
March 31 2004 8982.76 10264.8 9088
April 30 2004 8841.73 10147.8 9137
May 31 2004 8962.87 10133.6 9402
June 30 2004 9137.21 10392 9498
July 31 2004 8834.77 10112.5 9156
August 31 2004 8870.11 10172.1 9177
September 30 2004 8965.91 10090.7 8935
October 31 2004 9103.08 10054.4 9097
November 30 2004 9471.76 10485.8 9339
December 31 2004 9793.8 10857 9672
Jan. 31 2005 9554.83 10575.8 9532
Feb. 28 2005 9755.48 10884.6 9775
March 31 2005 9582.81 10633.1 9663
April 30 2005 9400.74 10334.3 9665
May 31 2005 9699.68 10641.3 9912
June 30 2005 9713.26 10461.4 9720
July 31 2005 10074.6 10850.6 9929
August 31 2005 9982.91 10721.5 9755
September 30 2005 10063.8 10822.3 9686
October 31 2005 9895.71 10704.3 9727
November 30 2005 10269.8 11123.9 10147
December 31 2005 10272.8 11046 9972
Jan. 31 2006 10545.1 11211.7 10091
Feb. 28 2006 10573.5 11377.7 10155
March 31 2006 10705.7 11519.9 10222
April 30 2006 10849.2 11805.6 10468
May 31 2006 10536.7 11633.2 10204
June 30 2006 10551.5 11628.6 10233
July 31 2006 10616.9 11680.9 10493
August 31 2006 10869.6 11925 10744
September 30 2006 11150 12251.8 11077
October 31 2006 11513.5 12689.2 11362
November 30 2006 11732.3 12885.8 11394
December 31 2006 11896.5 13157.7 11461
January 31 2007 12076.4 13341.9 11650
February 28 2007 11840.2 13005.7 11340
March 31 2007 11972.5 13115 11387
April 30 2007 12502.9 13883.5 12043
May 31 2007 12939.3 14524.9 12377
June 30 2007 12724.4 14308.5 12188
July 31 2007 12329.9 14115.3 12018
August 31 2007 12514.7 14312.9 12369
September 30 2007 12982.8 14906.9 12777
October 31 2007 13189.3 14963.6 12830
November 30 2007 12637.9 14418.9 12579
December 31 2007 12550.2 14323.7 12296
January 31 2008 11797.4 13682 11599
February 29 2008 11414.1 13305.8 11168
March 31 2008 11364.8 13320.4 11249
April 30 2008 11918.3 13946.5 11643
May 31 2008 12072.6 13793.1 11694
June 30 2008 11054.9 12409.6 10685
July 31 2008 10961.9 12463 11062
August 31 2008 11120.4 12688.6 11186
September 30 2008 10129.5 11948.8 10625
October 31 2008 8428.25 10290.3 9215
November 30 2008 7823.52 9790.21 8532
December 31 2008 7906.76 9751.05 8476
January 31 2009 7240.3 8909.54 7636
February 28 2009 6469.35 7911.67 6701
March 31 2009 7036.07 8538.27 7252
April 30 2009 7709.49 9182.91 7836
May 31 2009 8140.68 9597.06 8271
June 30 2009 8156.8 9558.67 8322
July 31 2009 8773.78 10394.1 8965
August 31 2009 9090.52 10805.7 9312
September 30 2009 9429.77 11068.3 9516
October 31 2009 9254.57 11083.8 9461
November 30 2009 9809.66 11850.8 10105
December 31 2009 9999.18 11963.4 10250
January 31 2010 9639.51 11566.2 9967
February 28 2010 9938.14 11906.2 10161
March 31 2010 10537.8 12538.4 10736
April 30 2010 10704.2 12730.3 10827
May 31 2010 9849.47 11769.2 9872
June 30 2010 9333.85 11366.6 9418
July 31 2010 9987.78 12188.5 10049
August 31 2010 9536.93 11711.9 9487
September 30 2010 10388 12631.3 10291
October 31 2010 10783.3 13036.7 10690
November 30 2010 10784.7 13116.2 10821
December 31 2010 11505.4 13815.3 11406

The performance data represents past performance and the principal value
and investment return will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than their original cost. Past performance
is no guarantee of future results. Please call (302) 791-1112 for the most
recent month-end performance.

In addition, the data does not reflect the deduction of taxes that a
shareholder would pay on distributions or redemption of Fund shares.

FOR THE YEAR ENDED DECEMBER 31, 2010

AVERAGE ANNUAL TOTAL RETURNS
----------------------------------------
SINCE
1 YEAR 5 YEAR 10 YEAR INCEPTION(3)
------ ------ ------- ------------

Chestnut Street Exchange Fund ....... 11.27% 2.58% 1.32% 10.89%
S&P 500(R) Index .................... 15.06% 2.29% 1.42% 10.83%
Dow Jones Industrial Average Index .. 14.09% 4.32% 3.16% 9.34%

----------
(1) The chart assumes a hypothetical $10,000 initial investment in the Fund
made on January 1, 2001 and reflects Fund expenses. Investors should note
that the Fund is a managed fund while the indices are unmanaged, do not
incur expenses and are not available for investment. THE FUND'S GROSS
EXPENSE RATIO FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010 WAS 0.51%.

(2) Results of index performance are presented for general comparative
purposes.

(3) Cumulative since inception total returns were 3,263.94%, 3,195.37% and
1,981.81% for the Chestnut Street Exchange Fund, the S&P 500(R) Index and
the Dow Jones Industrial Average Index, respectively, for the period
December 29, 1976 (inception) to December 31, 2010.

BLACKROCK CAPITAL MANAGEMENT, INC.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

FUND EXPENSE EXAMPLE

(UNAUDITED)

As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, and (2) ongoing costs, including management fees, and other Fund
expenses. The example is intended to help you understand your ongoing costs (in
dollars) of investing in the Fund and to compare these costs with the ongoing
costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning
of the six-month period from July 1, 2010 through December 31, 2010, and held
for the entire period.

ACTUAL EXPENSES

The first line of the accompanying table provides information about actual
account values and actual expenses. You may use the information in this line,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by the
number in the first line under the heading entitled "Expenses Paid During Six
Months Ending December 31, 2010" to estimate the expenses you paid on your
account during this period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the accompanying table provides information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed rate of return of 5% per year before expenses,
which is not your Fund's actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in the Fund and other funds. To do so, compare this
5% hypothetical example with the 5% hypothetical examples that appear in the
shareholder reports of other funds.

Please note that the expenses shown in the accompanying table are meant to
highlight your ongoing costs only and do not reflect any transactional costs.
Therefore, the second line of the accompanying table is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of
owning different funds. In addition, if these transactional costs were included,
your costs would have been higher.

CHESTNUT STREET EXCHANGE FUND

EXPENSES PAID
BEGINNING ENDING DURING SIX
ACCOUNT VALUE ACCOUNT VALUE MONTHS ENDING
JULY 1, 2010 DECEMBER 31, 2010 DECEMBER 31, 2010*
------------- ----------------- ------------------

Actual .......................... $1,000.00 $1,211.10 $2.90
Hypothetical
(5% return before expenses) .. $1,000.00 $1,022.55+ $2.65

----------
* Expenses are equal to the Fund's annualized six-month expense ratio of
0.52%, multiplied by the average account value over the period, multiplied
by the number of days (184) in the most recent fiscal half-year, then
divided by 365 to reflect the one-half year period. The Fund's ending
account value on the first line of the table is based on the actual total
return of 21.11% for the six-month period ending December 31, 2010.

+ Hypothetical expenses are based on the Fund's actual annualized six-month
expense ratio and an assumed rate of return of 5% per year before expenses.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

PORTFOLIO HOLDINGS SUMMARY TABLE

DECEMBER 31, 2010

(UNAUDITED)

% OF NET
SECURITY TYPE/INDUSTRY ASSETS VALUE
---------------------- -------- ------------

COMMON STOCKS:
Technology .............. 15.2% $ 29,276,186
Health Care ............. 15.1 28,978,852
Financial ............... 13.8 26,548,674
Consumer Cyclicals ...... 11.6 22,340,540
Energy .................. 10.6 20,333,002
Staples ................. 8.6 16,474,809
Capital Equipment ....... 8.0 15,375,452
Basics .................. 7.4 14,145,854
Transportation .......... 3.7 7,027,705
Utilities ............... 2.7 5,146,237
Retail .................. 2.3 4,347,276
Other Assets in Excess
of Liabilities ....... 1.0 2,014,704
----- ------------
Net Assets .............. 100.0% $192,009,291
===== ============

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

SCHEDULE OF INVESTMENTS

DECEMBER 31, 2010

Shares Value
------- ------------

COMMON STOCKS--99.0%
BASICS--7.4%
Air Products & Chemicals, Inc. ........................ 100,609 $ 9,150,388
Cabot Corp. ........................................... 86,032 3,239,105
Cabot Microelectronics Corp.* ......................... 42,373 1,756,361
------------
14,145,854
------------
CAPITAL EQUIPMENT--8.0%
Emerson Electric Co. .................................. 152,475 8,716,996
General Electric Co. .................................. 364,049 6,658,456
------------
15,375,452
------------
CONSUMER CYCLICALS--11.6%
3M Co. ................................................ 87,922 7,587,669
CBS Corp., - Class B .................................. 60,100 1,144,905
Comcast Corp., - Class A .............................. 149,743 3,289,854
Procter & Gamble Co. .................................. 85,100 5,474,483
Walt Disney Co. (The) ................................. 129,129 4,843,629
------------
22,340,540
------------
ENERGY--10.6%
Exxon Mobil Corp. ..................................... 147,227 10,765,238
Schlumberger, Ltd. .................................... 114,584 9,567,764
------------
20,333,002
------------
FINANCIAL--13.8%
American Express Co. .................................. 98,525 4,228,693
Ameriprise Financial, Inc. ............................ 22,266 1,281,408
Bank of America Corp. ................................. 56,084 748,161
JPMorgan Chase & Co. .................................. 140,310 5,951,950
Moody's Corp. ......................................... 82,738 2,195,867
Wells Fargo & Co. ..................................... 391,823 12,142,595
------------
26,548,674
------------
HEALTH CARE--15.1%
Abbott Laboratories ................................... 130,891 6,270,988
Baxter International, Inc. ............................ 64,986 3,289,591
Hospira, Inc.* ........................................ 23,125 1,287,831
Johnson & Johnson ..................................... 100,789 6,233,800
Medco Health Solutions, Inc.* ......................... 91,862 5,628,385
Merck & Co., Inc. ..................................... 173,925 6,268,257
------------
28,978,852
------------

Shares Value
------- ------------

RETAIL--2.3%
Home Depot, Inc. ...................................... 23,400 $ 820,404
Kohl's Corp.* ......................................... 15,200 825,968
Safeway, Inc. ......................................... 44,558 1,002,109
Wal-Mart Stores, Inc. ................................. 31,500 1,698,795
------------
4,347,276
------------
STAPLES--8.6%
Altria Group, Inc. .................................... 18,000 443,160
Coca-Cola Co. (The) ................................... 164,147 10,795,948
Hanesbrands, Inc.* .................................... 5,688 144,475
Kraft Foods, Inc., - Class A .......................... 12,456 392,488
PepsiCo, Inc. ......................................... 43,600 2,848,388
Philip Morris International, Inc. ..................... 18,000 1,053,540
Sara Lee Corp. 45,506 796,810
------------
16,474,809
------------
TECHNOLOGY--15.2%
Check Point Software
Technologies Ltd.* ................................. 52,400 2,424,024
Cisco Systems, Inc.* .................................. 32,700 661,521
Hewlett-Packard Co. ................................... 57,923 2,438,558
Intel Corp. ........................................... 556,800 11,709,504
International Business
Machines Corp. ..................................... 39,708 5,827,546
Microsoft Corp. ....................................... 139,643 3,898,833
Oracle Corp. .......................................... 74,000 2,316,200
------------
29,276,186
------------
TRANSPORTATION--3.7%
Union Pacific Corp. ................................... 75,844 7,027,705
------------
UTILITIES--2.7%
Verizon Communications, Inc. .......................... 143,830 5,146,237
------------
Total Common Stocks
(Cost: $37,804,052) ................................ 189,994,587
------------
TOTAL INVESTMENTS IN SECURITIES
(Cost: $37,804,052) ................................ 99.0% $189,994,587
Other assets in excess of liabilities ................. 1.0% 2,014,704
------- ------------
NET ASSETS ............................................ 100.0% $192,009,291
======= ============

----------
* Non-Income Producing

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

SCHEDULE OF INVESTMENTS (CONCLUDED)

DECEMBER 31, 2010

FAIR VALUE MEASUREMENTS. The inputs and valuation techniques used to measure
fair value of the Fund's investments are summarized into three levels as
described below:

- Level 1 -- quoted prices in active markets for identical securities

- Level 2 -- other significant observable inputs (including quoted prices for
identical securities in inactive markets and for similar securities,
interest rates, prepayment speeds, credit risk, etc.)

- Level 3 -- significant unobservable inputs (including the Fund's own
assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.

The following is a summary of inputs used, as of December 31, 2010, in valuing
the Fund's investments carried at value:

Level 2 Level 3
Total Level 1 Significant Significant
Value at Quoted Observable Unobservable
Fund 12/31/10 Prices Inputs Inputs
---- ------------ ------------ ----------- ------------

CHESTNUT STREET EXCHANGE FUND
Assets Investments in Common
Stock* .................. $189,994,587 $189,994,587 $-- $--
------------ ------------ --- ---

* See details of industry breakout.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2010

ASSETS
Investments in securities, at value (cost $37,804,052) ............. $189,994,587
Cash ............................................................... 2,539,649
Receivable for investments sold .................................... 301,705
Dividends receivable ............................................... 351,818
Interest receivable ................................................ 68
Prepaid expenses ................................................... 17,517
------------
Total assets .................................................... 193,205,344
------------
LIABILITIES
PAYABLES FOR:
Distributions ................................................... 779,444
Capital shares repurchased ...................................... 301,744
Advisory fees ................................................... 57,237
Managing general partners ....................................... 5,416
Custodian fees .................................................. 3,809
Transfer agent fees ............................................. 1,196
Accrued expenses and other liabilities ............................. 47,207
------------
Total liabilities ............................................ 1,196,053
------------
NET ASSETS ......................................................... $192,009,291
============
NET ASSETS CONSISTED OF:
Other capital -- paid-in or reinvested .......................... $ 42,261,942
Undistributed net investment income ............................. 165
Accumulated net realized loss on securities ..................... (2,443,351)
Net unrealized appreciation on investments ...................... 152,190,535
------------
Net Assets (Applicable to 556,795 partnership shares outstanding) .. $192,009,291
------------
NET ASSET VALUE PER SHARE ($192,009,291 / 556,795 SHARES) .......... $ 344.85
============
NET ASSETS APPLICABLE TO SHARES OWNED BY:
Limited partners (556,703 shares) .................................. $191,977,565
Managing general partners (92 shares) .............................. 31,726
------------
Total net assets (556,795 shares) .................................. $192,009,291
============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2010

INVESTMENT INCOME
Dividends ................................. $ 4,273,985
Interest .................................. 1,038
-----------
Total investment income ................ 4,275,023
-----------
EXPENSES
Investment advisory services .............. 655,890
Managing general partners' compensation,
officer's salary and expenses .......... 89,501
Legal fees ................................ 86,002
Printing .................................. 24,818
Insurance ................................. 23,055
Audit fees ................................ 19,900
Custodian fees ............................ 14,536
Transfer agent fees ....................... 14,430
Miscellaneous ............................. 15,030
-----------
Total expenses ......................... 943,162
-----------
Net investment income ............... 3,331,861
-----------
NET REALIZED AND UNREALIZED GAIN/(LOSS)
ON INVESTMENTS
Realized gain on sale of investment
securities ............................. 140,421
Realized gain from securities transactions:
distributed on redemption of
partnership shares ..................... 17,489,704
Unrealized appreciation on investments
Beginning of year ...................... $153,434,393
End of year ............................ 152,190,535
------------
Net change in unrealized appreciation ..... (1,243,858)
-----------
Net realized and unrealized gain
from investments ....................... 16,386,267
-----------
Net increase in net assets resulting
from operations ........................ $19,718,128
===========

STATEMENT OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31,

2010 2009
------------ ------------

INCREASE /(DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income .................. $ 3,331,861 $ 4,091,487
Net realized gain/(loss)
from securities
transactions, for federal
income tax purposes net
gain/(loss) is $140,421
and $1,415,829 ...................... 140,421 607,009
Excess of market value over
book value of securities
distributed upon redemption
of partnership shares ............... 17,489,704 20,001,156
Net change in unrealized
appreciation/(depreciation)
on investments ...................... (1,243,858) 9,677,204
------------ ------------
Increase in net assets
resulting from
operations .......................... 19,718,128 34,376,856
------------ ------------
DISTRIBUTIONS TO PARTNERS FROM:
Net investment income .................. (3,331,696) (4,092,954)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Net asset value of 1,218 and
1,644 shares issued in lieu
of cash distributions ............... 387,393 440,144
Cost of 58,629 and 79,240
shares repurchased .................. (18,613,630) (21,673,172)
------------ ------------
Decrease in net assets from
capital share transactions .......... (18,226,237) (21,233,028)
------------ ------------
Total increase/(decrease) in
net assets .......................... (1,839,805) 9,050,874
NET ASSETS:
Beginning of year ...................... 193,849,096 184,798,222
------------ ------------
End of year* ........................... $192,009,291 $193,849,096
============ ============

----------
* Includes undistributed net investment income of $165 and $0, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

FINANCIAL HIGHLIGHTS

(FOR A SHARE OF THE FUND OUTSTANDING THROUGHOUT EACH YEAR)

YEARS ENDED DECEMBER 31,
----------------------------------------------------
2010 2009 2008 2007 2006
-------- -------- -------- -------- --------

Net Asset Value, Beginning
of Year ........................ $ 315.61 $ 267.13 $ 400.30 $ 377.68 $ 337.28
-------- -------- -------- -------- --------
Income/(Loss) From Investment
Operations:
Net investment income .......... 5.79 6.28 8.06 7.62 6.88
Net gain/(loss) on securities
(both realized and
unrealized) ................. 29.24 48.48 (133.17) 22.62 40.40
-------- -------- -------- -------- --------
Total from investment
operations ............... 35.03 54.76 (125.11) 30.24 47.28
Less Distributions:
From net investment
income ...................... (5.79) (6.28) (8.06) (7.62) (6.88)
-------- -------- -------- -------- --------
Net Asset Value,
End of Year .................... $ 344.85 $ 315.61 $ 267.13 $ 400.30 $ 377.68
======== ======== ======== ======== ========
Total Return ...................... 11.27% 20.94% (31.56)% 8.05% 14.13%
======== ======== ======== ======== ========
Ratios/Supplemental Data:
Net Assets, End of
Year (000's) ................ $192,009 $193,849 $184,798 $296,277 $290,580
Ratios to average net assets:
Operating expenses .......... 0.51% 0.51% 0.46% 0.44% 0.44%
Net investment income ....... 1.80% 2.31% 2.33% 1.91% 1.93%
Portfolio Turnover Rate ........ 1.01% 1.06% 0.29% 0.68% 0.99%

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2010

(A) ORGANIZATION

Chestnut Street Exchange Fund (the "Fund"), a California Limited
Partnership, is registered under the Investment Company Act of 1940, as
amended, as a diversified open-end investment management company. The
Fund's investment objective is to seek long-term growth of capital and,
secondarily, current income. Effective January 1, 1998, the Fund changed
its status for tax purposes from a partnership to a regulated investment
company. The change resulted from the enactment of the "Publicly Traded
Partnership" rules to the Internal Revenue Code in 1987 which first applied
to the Fund after 1997.

(B) SIGNIFICANT ACCOUNTING PRINCIPLES

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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 increases and decreases in net assets from operations during the
reporting period. Actual results could differ from those estimates. The
following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.

SECURITY VALUATIONS

Securities listed or traded on an exchange are valued generally at the
last sales price as of the close of the customary trading session on
the exchange where the security is principally traded, or lacking any
sales on a particular day, valued at the closing bid price on that
day. Each security reported on the NASDAQ Stock Market, Inc. is valued
at the NASDAQ Official Close Price. Securities for which market
quotations are not readily available or are believed to be unreliable
are valued at fair value as determined in good faith using methods
approved by the Managing General Partners. Short-term obligations
having 60 days or less to maturity are valued at amortized cost which
approximates market value.

SECURITIES TRANSACTIONS AND INVESTMENT INCOME

Securities transactions are accounted for on a trade date basis.
Realized gains and losses on sales and redemptions in-kind are
computed on the basis of specific identification for both financial
reporting and income tax purposes. For securities exchanged into the
Fund at the Fund's inception in 1976, the cost for financial reporting
purposes is the value of those securities as used in the exchange. The
cost, for income tax purposes, of securities exchanged into the Fund
is the tax basis of the individual investor. Interest income is
recorded on the accrual basis. Dividend income is recorded on the
ex-dividend date.

DISTRIBUTIONS

Distributions from net investment income are paid quarterly and
recorded on the ex-dividend date. Distributions of capital gains, if
any, are paid annually and recorded on the ex-dividend date.

FEDERAL INCOME TAXES

The Fund intends to comply with the requirements of the Internal
Revenue Code necessary to qualify as a regulated investment company
and, as such, will not be subject to federal income taxes on otherwise
taxable income which is distributed to shareholders. The Fund may
elect not to distribute long-term capital gains to shareholders, but
retain these gains and pay the income tax at the applicable income tax
rate. If the Fund elects to pay the tax on long-term capital gains, on
the last day of the year the tax is paid, the partners are entitled to
a proportionate credit for the tax payment and the tax basis of their
shares is increased by the amount of undistributed gains less the tax
paid by the Fund. At December 31, 2010, the Fund had a capital loss
carryforward of $2,443,351, which expires December 31, 2016.
Therefore, no provision for federal income taxes is recorded in the
financial statements.

Management has analyzed the Fund's tax positions taken on federal
income tax returns for all open tax years (December 31, 2007 - 2010)
and has concluded that no provision for federal income tax is required
in the Fund's financial statements. The Fund's federal and state
income and federal excise tax returns for tax years for which the
applicable statutes of limitations have not expired are subject to
examination by the Internal Revenue Service and state departments of
revenue.

At December 31, 2010, the federal tax cost, aggregate gross unrealized
appreciation and depreciation of securities held by the Fund were as
follows:

Federal tax cost $ 35,141,248
------------
Gross unrealized appreciation 154,853,339
Gross unrealized depreciation --
------------
Net unrealized appreciation $154,853,339
============

The difference between book basis and tax basis of investments is
attributable to the use of the individual partners' tax basis for
those securities contributed to the Fund at its inception as required
by law.

BlackRock Capital Management, Inc. ("BCM" or the "Adviser"), a wholly owned
subsidiary of BlackRock Institutional Management, Inc., serves as
Investment Adviser to the Fund pursuant to an advisory agreement dated
September 29, 2006 ("Advisory Agreement"). BCM provides advisory,
accounting and administrative services to the Fund. All BlackRock entities
named are subsidiaries of BlackRock, Inc. BCM pays BNY Mellon Investment
Servicing (US) Inc. for administrative services provided to the Fund.

The Advisory Agreement provides for a fee at the annual rate of 4/10ths of
1% of the first $100,000,000 of the Fund's average daily net assets plus
3/10ths of 1% of net assets exceeding $100,000,000.

BNY Mellon Investment Servicing (US) Inc. (formerly known as PNC Global
Investment Servicing (U.S.) Inc.) and BNY Mellon Distributors, Inc.
(formerly known as PFPC Distributors, Inc.) serve as the Fund's transfer
and dividend disbursing agent, respectively.

PFPC Trust Company serves as the Fund's custodian.

The Managing General Partners each receive a fixed fee as compensation for
their services. In addition, the President, Treasurer and Chief Compliance
Officer receives additional payments for overseeing the Fund's activities
including compliance with federal securities laws, plus reimbursements of
related expenses. Total payments to or for the Managing General Partners
amounted to $89,501.

Legal fees amounting to $86,002 were paid to Drinker Biddle & Reath LLP.
Michael P. Malloy, Esq., Secretary of the Fund, is a partner of that firm.

(D) INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding short-term
obligations and redemptions in-kind) were $1,830,772 and $2,380,488,
respectively, for the year ended December 31, 2010.

(E) DISTRIBUTIONS TO SHAREHOLDERS

Net investment income and capital gain distributions are determined in
accordance with Federal income tax regulations, which may differ from
accounting principles generally accepted in the United States of America.
The primary difference applicable to the Fund's distributions is the
requirement to pass through 40% of its aggregate expenses to the partners
of the Fund. This is required because the Fund has fewer than 500 partners
and does not continuously offer shares. The partners treat this
pass-through of expenses as a distribution of net investment income and a
corresponding miscellaneous itemized deduction of investment expense.

The tax character of distributions paid during 2010 and 2009 were as
follows:

2010 2009
---------- ----------

Ordinary income ............. $3,708,961 $4,455,738
Investment expense .......... (377,265) (362,784)
---------- ----------
$3,331,696 $4,092,954
========== ==========

For federal income tax purposes, distributions of net investment income and
short-term capital gains are treated as ordinary income dividends.

(F) IN-KIND DISTRIBUTION OF SECURITIES

During the year ended December 31, 2010, the Fund distributed portfolio
securities in lieu of cash for most shareholder redemptions. The value of
these redemptions was as follows:

NET REALIZED FUND
VALUE OF THE GAIN INCLUDED SHARES
REDEMPTIONS CASH IN REDEMPTIONS REDEEMED
------------ ------ -------------- --------

$18,612,325 $1,305 $17,489,704 58,629

Net realized gains from these transactions are not taxable to the Fund.
Such gains are not distributed to shareholders and will be reclassified to
paid-in capital at the Fund's fiscal year end. These transactions were
completed following guidelines approved by the Managing General Partners.

(G) INDEMNIFICATIONS

In the ordinary course of business, the Fund enters into contracts that
contain a variety of indemnifications. The Fund's maximum exposure under
these arrangements is dependent on claims that may be made against the Fund
in the future, and therefore, cannot be estimated. However, based on
experience, the risk of material loss for such claims is considered remote.

(H) TAX MATTERS

At December 31, 2010, the components of distributable earnings on a tax
basis were as follows:

Undistributed ordinary income ...................... $ 165
Capital loss carryover ............................. (2,443,351)
Net unrealized appreciation of investments ......... 154,853,339
------------
$152,410,153
============

On December 31, 2010, undistributed net realized gain/accumulated realized
loss on securities was decreased by $17,892,394 and additional paid-in
capital was increased by $17,892,394 due to permanent differing book and
tax treatment of realized gains and losses attributable to the differences
in the book and tax cost of securities described in Note B. Net assets of
the Fund were unaffected by this change.

(I) NEW ACCOUNTING PRONOUNCEMENT

In January 2010, the Financial Accounting Standards Board ("FASB") issued
Accounting Standards Update ("ASU") No. 2010-06 "IMPROVING DISCLOSURES
ABOUT FAIR VALUE MEASUREMENTS". ASU 2010-06 amends FASB Accounting
Standards Codification Topic 820, Fair Value Measurements and Disclosures,
to require additional disclosures regarding fair value measurements.
Certain disclosures required by ASU No. 2010-06 are currently effective for
interim and annual reporting periods beginning after December 15, 2009.
Management has evaluated the impact and has incorporated the appropriate
disclosures required by ASU No. 2010-06 in its financial statement
disclosures. Other required disclosures are effective for fiscal years
beginning after December 15, 2010, and for interim periods within those
fiscal years. Management is presently evaluating the impact on the
financial statements of these disclosure requirements.

(J) SUBSEQUENT EVENTS

Management has evaluated the impact of all subsequent events on the Fund
through the date the financial statements were issued, and has determined
that there were no subsequent events.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE PARTNERS OF
CHESTNUT STREET EXCHANGE FUND

We have audited the accompanying statement of assets and liabilities,
including the schedule of investments of Chestnut Street Exchange Fund (the
"FUND"), as of December 31, 2010, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of
the two years in the period then ended and the financial highlights for
each of the five years in the period then ended. These financial statements
and financial highlights are the responsibility of the Fund's management.
Our responsibility is to express an opinion on these financial statements
and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audits to obtain reasonable assurance about
whether the financial statements and financial highlights are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2010 by correspondence with the custodian. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Chestnut Street Exchange Fund as of December 31, 2010, the results of
its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended and the financial highlights
for each of the five years in the period then ended, in conformity with
accounting principles generally accepted in the United States of America.

(BBD, LLP)
BBD, LLP

PHILADELPHIA, PENNSYLVANIA
FEBRUARY 16, 2011

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

ADDITIONAL INFORMATION (UNAUDITED)

ANNUAL APPROVAL OF INVESTMENT ADVISORY AGREEMENT

At a meeting held on July 28, 2010, the Managing General Partners of the
Chestnut Street Exchange Fund (the "Fund"), including the Independent Managing
General Partners, approved the continuation of the investment advisory agreement
with BlackRock Capital Management, Inc. ("BCM") with respect to the Fund for an
additional one-year period. In connection with their approval, the Managing
General Partners considered, with the assistance of independent counsel, their
legal responsibilities and reviewed the nature and quality of services provide
to the Fund and BCM's experience and qualifications. The Managing General
Partners reviewed and considered a report that included, among other things, (1)
a comparison of the assets, advisory fee and total expense ratio of shares of
the Fund to those of the BlackRock Funds Exchange Portfolio (the "BlackRock
Portfolio"), the other exchange fund managed by BCM; (2) a comparison of the
performance of the Fund to the BlackRock Portfolio, its benchmark (S&P 500) as
well as the Dow Jones Industrial Average and its Lipper peer group; (3)
compensation or possible benefits to BCM arising from its relationship with the
Fund; (4) a discussion of the current business activities of BCM's parent,
BlackRock Inc.; (5) information about the services provided to the Fund, the
personnel that are involved in the management of the Fund and how they are
compensated; (6) a description of the procedures for determining that the Fund
receives best execution and for allocating portfolio opportunities among the
Fund and other advisory clients of BCM; (7) the nature of BCM's internal
controls to monitor portfolio compliance; and (8) the costs of the services to
be provided BCM's profits with respect to the Fund. BCM noted that economies of
scale was not relevant since the Fund was closed to new investors.

After discussion, the Managing General Partners concluded that BCM had the
capabilities, resources and personnel necessary to manage the Fund. The Managing
General Partners also concluded that, based on the services that BCM would
provide to the Fund under the investment advisory agreement, the fee was fair
and equitable. The Managing General Partners considered the fees paid by the
Fund in relation to BlackRock Portfolio's fees and the Fund's Lipper peer group,
as well as the Fund's performance. The Managing General Partners concluded that
the advisory fees paid by the Fund were fair and equitable. The Managing General
Partners determined that the services provided by BCM were adequate.

PROXY VOTING

Policies and procedures that the Fund uses to determine how to vote proxies
relating to portfolio securities as well as information regarding how the Fund
voted proxies relating to portfolio securities for the most recent 12-month
period ended June 30 are available without charge, upon request, by calling
(302) 791-1112 and on the Securities and Exchange Commission's ("SEC") website
at http://www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

The Fund files a complete schedule of portfolio holdings with the SEC for the
first and third fiscal quarters of each fiscal year (quarters ended March 31 and
September 30) on Form N-Q. The Fund's Form N-Q is available on the SEC website
at http://www.sec.gov and may be reviewed and copied at the SEC Public Reference
Room in Washington, D.C. Information on the operation of the SEC Public
Reference Room may be obtained by calling 1-800-SEC-0330.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

ADDITIONAL INFORMATION (CONCLUDED) (UNAUDITED)

TAX INFORMATION

As required by the Internal Revenue Code, 100% of ordinary income dividends paid
for the year ended December 31, 2010 have been designated as: 1) qualified for
the reduced tax rate under The Job and Growth Tax Relief Reconciliation Act of
2003, and 2) eligible for the dividend received deduction for corporate
shareholders.

CHESTNUT STREET EXCHANGE FUND

(A CALIFORNIA LIMITED PARTNERSHIP)

INFORMATION ON THE MANAGING GENERAL

PARTNERS AND OFFICERS OF THE FUND

(UNAUDITED)

The list below provides certain information about the identity and business
experience of the Managing General Partners and officers of the Fund. The Fund's
Statement of Additional Information includes additional information about the
Fund's Managing General Partners, which may be obtained from the Fund free of
charge by calling 1-800-852-4750.

TERM OF OFFICE: The Fund's partnership agreement provides that each Managing
General Partner holds officer until the earliest of (a) the election of his or
her successor; or (b) the date a Managing General Partner dies, resigns, becomes
insane, is adjudicated as bankrupt or is removed by a majority of the partners.
The officers of the Fund are elected by the Managing General Partners and each
officer holds office for one year or until he or she shall resign or be removed
or until his or her successor is elected and qualified.

NUMBER OF
PORTFOLIOS
IN FUND OTHER
POSITION WITH PRINCIPAL COMPLEX(1) DIRECTORSHIP(2)
THE FUND AND OCCUPATIONS DURING OVERSEEN BY HELD BY
LENGTH OF PAST 5 YEARS AND MANAGING MANAGING
NAME, ADDRESS, AND AGE TIME SERVED CURRENT AFFILIATIONS GENERAL PARTNERS GENERAL PARTNER
---------------------- ----------------- ----------------------------------- ---------------- ----------------

INTERESTED MANAGING
GENERAL PARTNERS

Edward J. Roach* Managing Certified Public Accountant; 1 None
103 Bellevue Parkway General Partner President and/or Treasurer of 1
Wilmington, DE 19809 since 2000, Chief other investment company
Age: 86 Compliance advised by BCM, 1988-2009.
Officer since
2004, President
since 2002,
Treasurer since
1981

DISINTERESTED MANAGING
GENERAL PARTNERS

Gordon L. Keen, Jr. Managing Senior Vice President, Law & 1 None
c/o Edward J. Roach General Partner Corporate Department, Airgas,
103 Bellevue Parkway since 2006 Inc. (Radnor, PA-based distributor
Wilmington, DE 19809 of industrial, medical and special-
Age: 66 ty gases, and welding and safety
equipment and supplies) from
January 1992 to January 2006.

Langhorne B. Smith Managing Retired. President and Director, 1 None
c/o Edward J. Roach General Partner The Sandridge Corporation
103 Bellevue Parkway since 1997 (private investment company);
Wilmington, DE 19809 Director, Claneil Enterprises, Inc.
Age: 74 (private investment company).

David R. Wilmerding, Jr. Managing Retired. Chairman, Wilmerding & 1 Director, Beaver
c/o Edward J. Roach General Partner Associates (investment advisers) Management
103 Bellevue Parkway since 1976; from February 1989 to 2006. Corporation
Wilmington, DE 19809 Chairman of the
Age: 75 Managing General
Partners since
2006

OFFICERS

Michael P. Malloy Secretary Secretary of the Chestnut Street N/A N/A
Drinker Biddle & Reath since 2001 Exchange Fund; Partner in the
One Logan Square law firm of Drinker Biddle &
18th and Cherry Streets Reath LLP.
Philadelphia, PA 19103
Age: 51

James G. Shaw Assistant Vice President since 1995 and N/A N/A
103 Bellevue Parkway Treasurer Since Director since 2005; BNY Mellon
Wilmington, DE 19809 2009 Investment Servicing (US) Inc.
Age: 50 (formerly PNC Global Investment
Servicing (U.S.), Inc.)

----------
* Mr. Roach is an "interested person" of the Fund as that term is defined in
the Investment Company Act of 1940 ("1940 Act"). Mr. Roach is an employee
of the Fund.

(1) The Fund Complex includes all registered investment companies that are
advised by BlackRock Capital Management, Inc. or one of its affiliates.

(2) Directorships of companies required to report to the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended
(i.e., "public companies") or other investment companies registered under
the 1940 Act.

[THIS PAGE INTENTIONALLY LEFT BLANK]

================================================================================

(CHESTNUT STREET EXCHANGE FUND LOGO)

Annual Report
December 31, 2010

Chestnut Street Exchange Fund
103 Bellevue Parkway
Wilmington, Delaware 19809
(302) 791-1112
Edward J. Roach, President & Treasurer

MANAGING GENERAL PARTNERS
Gordon L. Keen, Jr.
Edward J. Roach
Langhorne B. Smith
David R. Wilmerding, Jr.

INVESTMENT ADVISERS
BlackRock Capital Management, Inc.
100 Bellevue Parkway
Wilmington, Delaware 19809

TRANSFER AGENT
BNY Mellon Investment
Servicing (US) Inc.
P.O. Box 8950
Wilmington, Delaware 19899
(800) 852-4750

================================================================================

ITEM 2. CODE OF ETHICS.

(a) The registrant, as of the end of the period covered by this report,
has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party.

(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are
employed by the registrant or a third party, and that relates to any
element of the code of ethics description.

(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are
employed by the registrant or a third party, that relates to one or
more of the items set forth in paragraph (b) of this item's
instructions.

(f) A copy of the Code of Ethics is available as provided in Item 12(a)(1)
of this report.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The registrant's board of managing general partners has determined that the
registrant has at least one "audit committee financial expert" (as defined in
Item 3 of Form N-CSR) serving on its audit committee. Langhorne B. Smith is the
"audit committee financial expert" and is "independent" (as each item is defined
in Item 3 of Form N-CSR).

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

AUDIT FEES

(a) The aggregate fees billed for each of the last two fiscal years for
professional services rendered by the principal accountant for the
audit of the registrant's annual financial statements or services that
are normally provided by the accountant in connection with statutory
and regulatory filings or engagements for those fiscal years are
$19,000 for 2009 and $19,900 for 2010.

AUDIT-RELATED FEES

(b) The aggregate fees billed in each of the last two fiscal years for
assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's
financial statements and are not reported under paragraph (a) of this
Item are $0 for 2009 and $0 for 2010.

TAX FEES

(c) The aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning are $0 for 2009 and $0 for
2010.

ALL OTHER FEES

(d) The aggregate fees billed in each of the last two fiscal years for
products and services provided by the principal accountant, other than
the services reported in paragraphs (a) through (c) of this Item are
$0 for 2009 and $0 for 2010.

(e)(1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

The Audit Committee does not have pre-approved policies and
procedures. Instead, the Audit Committee approves on a case-by-case
basis each audit or non-audit service before the accountant is engaged
by the Registrant.

(e)(2) No services described in paragraph (b) through (d) were approved by
the Audit Committee pursuant to the "de minimis" exception of Rule
2-01(c)(7)(i)(c) of Regulation S-X.

(f) The percentage of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most
recent fiscal year that were attributed to work performed by persons
other than the principal accountant's full-time, permanent employees
was 0%.

(g) The aggregate non-audit fees billed by the registrant's accountant for
services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen
by another investment adviser), and any entity controlling, controlled
by, or under common control with the adviser that provides ongoing
services to the registrant for each of the last two fiscal years of
the registrant was $0 for 2009 and $0 for 2010.

(h) The registrant's audit committee of the board of directors has
considered whether the provision of non-audit services that were
rendered to the registrant's investment adviser (not including any
sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser), and any
entity controlling, controlled by, or under common control with the
investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

ITEM 6. INVESTMENTS.

(a) Schedule of Investments in securities of unaffiliated issuers as of the
close of the reporting period is included as part of the report to
shareholders filed under Item 1 of this form.

(b) Not applicable.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of managing general partners.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of this report, based on the evaluation of
these controls and procedures required by Rule 30a-3(b) under the 1940
Act (17 CFR 270.30a-3(b)) and Rule 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.15d-15(b)).

(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d))), that occurred during the second fiscal

quarter of the period covered by this report that have materially
affected, or are reasonably likely to materially affect, the
registrant's internal control over financial reporting.

ITEM 12. EXHIBITS.

(a)(1) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.

(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

(a)(3) Not applicable.

(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

(registrant) Chestnut Street Exchange Fund

By (Signature and Title)* /s/ Edward J. Roach
----------------------------------
Edward J. Roach, President & Treasurer
(Principal Executive Officer & Principal Financial
Officer)

Date March 8, 2011
------------------

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

By (Signature and Title)* /s/ Edward J. Roach
----------------------------------
Edward J. Roach, President & Treasurer
(Principal Executive Officer & Principal Financial
Officer)

Date March 8, 2011
------------------

* Print the name and title of each signing officer under his or her
signature.