BlackRock’s poor performance fails to dampen flow of cash

Michael Bow
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Chancellor George Osborne helped open BlackRock’s new offices in London in 2011
The world’s biggest money manager BlackRock saw performance fees plummet by almost half last quarter after its alternative investments stumbled.

The group added another $87.8bn of cash from customers over the quarter ending December but revenue from its funds which outperform the stock market fell to $144m from $268m compared to the same period last year.

The company, which has its European headquarters in Drapers’ Gardens, makes money by charging fees on the cash it manages for clients such as pension funds and ordinary savers.

Fees earned on alternative investments – such as hedge funds, private equity and property – fell by $128m compared to the same period last year. Fees on other asset classes were broadly flat.

The overall slump in performance fees hurt revenues, which fell from $841m to $813m.

BlackRock is led by founder Larry Fink. “In an environment of heightened market uncertainty, our clients’ investment challenges are increasingly complex,” he said.

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