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Steve Walker
Business Analyst / PM - Associate, Goldman Sachs,
New York, NY

Premium Contributor
STREET Cred - 2,106

By SUSANNE CRAIG

BlackRock, the world’s largest asset manager, said on Wednesday that its second-quarter profit rose 25 percent, to $578 million, spurred by strong showings in most of its divisions.

While other financial firms get felled by mortgage liabilities, trading misses and other problems, BlackRock continued to chug along, producing double-digit gains in both revenue and profit.

In discussing BlackRock’s performance, Laurence D. Fink, the chief executive, said it came amid tough conditions in which “investors grew increasingly concerned about uncertainties in the market, including the sovereign debt crisis in Europe, political stalemate on the U.S. debt ceiling, and prospects of slower economic growth.”

The firm also easily surpassed expectations with earnings of $3 a share. Analysts had been predicting $2.88 a share.

Assets under management, an important measure of the firm’s health, rose 16 percent, to nearly $3.7 trillion, buoyed in part by the stock markets. Revenue also increased 16 percent, to $2.35 billion.

Revenue from investment advisory, administration fees and securities lending came in at $2.1 billion, up 17 percent from the $1.8 billion posted in the second quarter of 2010. The firm said the increase was a result of growth in long-term assets under management, which reflected the benefit of both new business and market appreciation of assets over the last year.

BlackRock Solutions was pretty much flat in quarter, reporting revenue of $116 million, up $2 million from the period a year earlier. The group, which flourished during the financial crisis, provides risk management advice to institutions and governments. It gained 10 new assignments in the second quarter, and its clients have included the Irish central bank and the Federal Reserve.

“The level of geopolitical, regulatory and economic uncertainty is exceptionally high and contributing to considerable volatility in the markets,” Mr. Fink said. “Our teams are working tirelessly to communicate with our clients and help navigate these difficult conditions.”