BlackRock’s Larry Fink warns of ‘substantial’ impact from markets on earnings

BlackRock chair and chief executive Larry Fink has warned that “negative markets had a substantial impact” on its financial results, hitting its revenues and profits.

The asset manager was “not immune to complex and volatile market conditions”, Fink said in an internal memo to employees, seen by the Financial Times. He noted that the operating environment “is unlike anything we’ve seen in decades”.

He said that “2022 was a year of huge transition for geopolitics and markets”, adding that “this was the first time in decades that both stock and bond markets were down at the same time”.

Fourth-quarter revenue decreased by 15 per cent to $4.3bn compared with the same period a year ago, BlackRock said in a statement on Friday. The fall in bond and equity markets last year has weighed on fund groups, reducing their assets and denting revenues as a result.

The New-York based manager, known for its iShares range of index funds and actively managed products, reported adjusted earnings per share for the quarter of $8.93, a 16 per cent decrease year on year.

However, assets under management increased in the fourth quarter to $8.6tn following a jump in investment flows from $8tn the previous quarter, beating analyst expectations.

BlackRock also reported long-term net inflows of $146bn into its investment products, more than double the previous quarter.

The world’s largest asset manager said it had a “record” year for flows into its bond exchange traded funds.