Blackrock: Larry Fink writes off at least $17 billion on Russian investments

Enlarge image

Blackrock boss

has written off a large part of the Russian investments of the world's largest asset manager

Photo by Ng Han Guan/ AP

Clients of the world's largest wealth manager, Blackrock, held assets worth around $18.2 billion in Russia at the end of January.

Most of these have become unsaleable due to the closed markets and sanctions against the country, so Blackrock has now largely written them off.

The associated losses amount to around 17 billion dollars, reports the "Financial Times" on Friday.

The Moscow Stock Exchange has been closed since February 28.

However, trading in these securities is also suspended on most other trading centers in the world where Russian securities are listed.

At the end of February, Blackrock stopped all purchases of Russian assets and wrote off most of its securities holdings.

The asset manager declined to break down its holdings of Russian securities or detail which funds suffered which losses, the report said.

CEO

(69) said in a Linkedin post that Blackrock will continue to actively consult with regulators, index providers and other market participants to ensure "our clients can exit their Russian securities whenever and wherever the regulatory and market conditions permit".

With approximately $10 trillion in assets under management, Blackrock is the largest capital aggregator in the world.

The tremendous value destruction at Blackrock alone outlines the damage that the Russian invasion of Ukraine has inflicted on the entire financial system.

Norway's sovereign wealth fund recently wrote off almost all of its roughly $3 billion in assets held in Russia.

At the end of last year, the fund held shares in 51 companies in Russia.

Other money managers are likely to follow the example of Blackrock and Norway's sovereign wealth fund and also write off billions of dollars on their exposure to Russia, experts say.

The Allianz subsidiary Pimco bet against a possible insolvency of the country with credit default swaps (CDS) worth 1.1 billion dollars, at the same time the subsidiary held Russian government bonds worth the equivalent of 1.5 billion dollars until shortly before the outbreak of the war .

Hundreds of billions are at stake

Morningstar's rating experts estimate that the top 100 funds' exposure to Russian stocks and bonds was around $60 billion at the end of February.

According to US bank JP Morgan, foreign creditors are also said to be holding $79 billion in Russian debt.

According to data from the Bank for International Settlements (BIS), foreign banks and financial institutions are said to bear a Russia risk of around 120 billion dollars.

rei