Blackrock hits rock in Europe
Giant slashes 500 jobs in coming weeks after investors pull money from actively managed funds in 2018.
After topping Europe’s list of best-selling asset managers in 2017, Blackrock even slipped out from the top-ten in 2018. It now responds to its increasingly cost-conscious environment by letting go of 500 employees, in a drive to shift costs to prioritized areas of the business.
Net sales down 98 percent
The asset manager’s scary European slide in net-sales – from €60 billion in 2017 to just €1.3 billion in the year just finished – shows in preliminary data from Morningstar, as referred to by business site Financial News.
During the year, investors moved money from the firm’s actively managed funds, according to the article.
ETFs grow fast
The new plan to cut roughly 500 jobs, making for around 3 percent of the staff, was reported on Thursday by media including the Wall Street Journal. They will be picked across the firm.
Money saved is to be used for investment in the company’s listed priority areas which include technology offerings, illiquid alternative assets, retirement funds and its fast-growing activities in exchange traded funds, ETFs.
Done it before
Even after the cut, the number of employees will be 4 percent higher than a year ago, writes the Wall Street Journal on its web site. The plans echo a cut-down in 2016, also by 3 percent of the employees.