BlackRock Freezes Hiring, Puts Check On Expenses Citing Performance Challenges - BlackRock (NYSE:BLK)

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  • BlackRock Inc’s BLK Chief Financial Officer Gary Shedlin said the company is putting a stop to hiring and reducing expenses during a financial conference hosted by Goldman Sachs.
  • “We’re trying to be a little more prudent,” he said, adding that these measures will put BlackRock in a better position next year, Reuters reported.
  • Shedlin added that BlackRock witnessed some weakness in retail mutual funds, with some short-term performance challenges.
  • However, it expects a sizeable ramp-up in performance fees from illiquid businesses in the coming years.
  • In Q3, BlackRock’s assets under management dropped 16% Y/Y to $7.96 billion, as investments in Europe and Asia lost value due to a stronger dollar. Its net income also fell 17% to $1.45 billion.
  • Shares in BlackRock are down roughly 30% this year, underperforming the benchmark S&P 500 Index.
  • Separately, small activist investor Bluebell Capital Partners Ltd has sought to replace BlackRock CEO Larry Fink for being inconsistent in its focus on environmental, social, and corporate governance (ESG) issues.
  • Related: BlackRock’s Eco-Friendly Stance Upsets Republicans, $1B Pulled In ESG Protest.
  • As per the Reuters report, Bluebell said BlackRock and Fink have “alienated clients and attracted an undesired level of negative publicity” with the firm’s ESG strategy.
  • The hedge fund that owns 0.01% in the asset manager also wants BlackRock to “initiate a strategic review of (its) stance on ESG” and adopt other governance changes.
  • Price Action: BLK shares closed at $708.00 on Tuesday.

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Image and article originally from www.benzinga.com. Read the original article here.