BlackRock (BLK) announced major changes Tuesday in its upper management structure, aimed at growing both its presence in alternative investments and with institutional investors. At the end of 2018, the asset management firm had just less than $6 trillion in assets under management. Last year saw BlackRock bring in its lowest net asset flows, $123.6 billion, since 2013, and only about one-third of its 2017 haul. As a percentage of its beginning assets under management, those net flows were just under less than 2%, well below its six-year trend.
The firm’s alternative assets under management were about $143.4 billion at the end of 2018, about 2.4% of its total AUM and grew 10.8% during the year.
A decline in net flows as a percentage of total AUM should be expected as assets get larger. While this new focus is likely not a knee-jerk reaction to 2018’s drop-off, it may have reconfirmed the notion that the firm cannot count on its low-cost index products to do the heavy lifting. First quarter 2019 financials are set to be released on April 16.