BlackRock Earnings Rise 9 Percent, Buoyed by Passive Funds
Indeed, as BlackRock cements its place as the industry leader in terms of E. T.F.s — with the index giant Vanguard entrenched in second place — Mr. Fink will remain under pressure to ensure
that its other activities, from managing bonds to to its struggling stock-picking division, keep pace with the surging passive business.
By LANDON THOMAS Jr. JULY 17, 2017
BlackRock, the world’s largest asset management firm, said on Monday
that second-quarter earnings had risen 9 percent as investors continued to pour money into the company’s expanding fleet of exchange traded funds.
“We had strong flows, our fees are up and we are continuing to build deeper and broader relations with our clients.”
In explaining the rush of money into E. T.F.s, Mr. Fink emphasized
that now, more than ever, the job for financial firms is to provide solutions-driven advice as opposed to merely pushing a client into a certain fund.
Generally one to take a cautionary view toward the markets, Mr. Fink said
that the broader investment environment was rapidly improving — thanks to a turnaround in Europe, consistent growth coming out of China and an improving United States economy.
The company, which oversees $5.7 trillion in assets, received $94 billion in net investor money during the quarter, with $74 billion of
that amount flowing into the company’s iShares-branded exchange traded funds.
The continuing strong performance by the iShares division highlights why BlackRock’s chief executive, Laurence D. Fink, made the decision in March to close down
and repurpose a number of the firm’s sluggishly performing mutual funds that rely on individuals to pick stocks.
