BlackRock profits fall 20% as market turmoil hits fees

Stockmarket-Stock-Market-FTSE-Performance-700x450.jpgBlackRock’s profits fell 20 per cent in the first quarter of the year amid market swings, after job cuts at the firm were revealed.

In its first quarter results, published today, net income at the giant money manager decreased to $657m (£464m) from $822m for the same quarter a year ago.

BlackRock chief executive Laurence Fink says: “While we of course were not immune to the effects of market movements, which impacted both base fees and performance fees this quarter, the magnitude and diversification of our inflows speak to the differentiation of BlackRock’s platform and our ability to serve our clients.”

Expenses rose 0.3 per cent to $1.66bn, mainly due to the $76m restructuring charge for the period.

It is understood that the manager is planning to cut 400 jobs in the coming weeks as the firm redirects resources to growing areas of the business.

The reductions at the £3.1trn money manager are equal to around 3 per cent of the firm’s 13,000 employees.

Elsewhere in the results, revenue declined to $2.62bn in the first quarter, a 3.6 per cent drop compared to a year ago.

Assets under management increased to $4.74trn from $4.65trn in the fourth quarter and $4.46 in March 2015.

In particular, the firm’s iShares business reported more than $24bn in net inflows during the quarter, driven by more than $27bn of inflows into fixed income.