Fed’s big boost for BlackRock raises eyebrows on Wall Street

Gareth Jones

March 27, 2020

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Gareth Jones

asset management

On Tuesday, investors poured a record-breaking $1.5bn into an exchange traded fund run by BlackRock, a sum that represents about $2.3m of fees for the asset management giant. And it was all thanks to the Federal Reserve.

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The company will credit back to the Fed any fees earned on programme assets that are invested in its own ETFs and will also refund the fees earned on investments in ETFs of its rivals, according to an update from the Fed posted on Friday. But this week’s inflows into its ETF, as investors raced to front-run the central bank’s expected purchases, show how the Fed has already indirectly shaped markets to BlackRock’s benefit.

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