8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 18, 2013

BLACKROCK, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	001-33099	32-0174431
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

55 East 52nd Street, New York, New York	10055
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 810-5300

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On July 18, 2013, BlackRock, Inc. (the “Company”) reported results of operations for the three and six months ended June 30, 2013. A copy of the press release issued by the Company is attached as Exhibit 99.1. In addition, a copy of the Company’s Press Release Supplement for the quarter ended June 30, 2013 is being furnished as Exhibit 99.2 to this Form 8-K.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

99.1	Press release dated July 18, 2013 issued by the Company
99.2	Second Quarter 2013 Earnings – Press Release Supplement

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	BlackRock, Inc. (Registrant)
	By:	/s/ Gary Shedlin
Date: July 18, 2013		Gary Shedlin
		Senior Managing Director and Chief Financial Officer

EXHIBIT INDEX

99.1	Press release dated July 18, 2013 issued by the Company
99.2	Second Quarter 2013 Earnings – Press Release Supplement

EX-99.1

Exhibit 99.1

Media Relations: Brian Beades 212-810-5596 Investor Relations: Tom Wojcik 212-810-8127

BlackRock Reports Quarterly Diluted EPS of $4.19, or $4.15 as adjusted

$3.857 Trillion in assets under management at June 30, 2013, up 8% year over year

• Record base fees of $2.2 billion for the quarter

• Operating income growth of 2% from 2012, or 18% as adjusted, drove adjusted operating margin expansion

• Continued commitment to sound capital management with $250 million of quarterly share repurchases

• Funded new charitable foundation to focus on giving back to communities where BlackRock operates, including, among other things, helping to promote financial education for low-income families and individuals

New York, July 18, 2013 — BlackRock, Inc. (NYSE:BLK) today reported second quarter 2013 diluted EPS of $4.19, up 36% from a year ago. Revenue increased 11% from the second quarter 2012, reflecting growth in markets, long-dated net new business and higher performance fees. Operating income for the second quarter 2013 was $849 million with an operating margin of 34.2%. In connection with the PennyMac IPO during the second quarter 2013, the Company recorded a non-cash, non-operating pre-tax gain of $39 million related to the carrying value of the Company’s equity method investment. Subsequent to the PennyMac IPO, the Company contributed 6.1 million units of its PennyMac investment to a new Donor Advised Fund (“DAF”) (the “Charitable Contribution”). The Charitable Contribution resulted in an operating expense of $124 million, offset by an $80 million non-cash, non-operating pre-tax gain on the contributed units and a tax benefit of approximately $57 million.

As adjusted results⁽¹⁾: Second quarter 2013 diluted EPS of $4.15 improved 34% and operating income of $982 million rose 18% compared with the second quarter 2012. Diluted EPS included operating income of $4.10 per diluted share and net non-operating income of $0.05 per diluted share, including the $39 million non-cash, pre-tax gain related to the PennyMac IPO. The financial impact related to the Charitable Contribution has been excluded from as adjusted results. Operating margin of 41.3% in the second quarter 2013 rose 210 bps from the second quarter 2012. Compared with the first quarter 2013, operating margin rose 130 bps, reflecting growth in base fees, lower payroll taxes and lower organizational costs, partially offset by lower performance fees and higher brand campaign costs.

“Our second quarter results, which reflect adjusted operating income up 18% year-over-year, once again highlight the strength of our globally diversified multi-client platform that was built to deliver in all market environments,” commented Laurence D. Fink, Chairman and CEO of BlackRock. “During the quarter we generated record base fees and $11.9 billion in long-dated net new business across a broad range of products, including 11 funds that each raised more than $1 billion. These funds showcased the diversity of our offering, with representation across all major asset classes, client segments and geographies. Results were driven by global demand from retail and institutional clients for multi-asset class, unconstrained fixed income and retail alternative products. Our strong product capabilities in the retail alternative mutual fund space, coupled with our broad distribution platform, uniquely position us in this high growth segment, where second quarter net flows of $1.1 billion drove sequential quarter AUM growth of 72%.”

The table below presents AUM and a comparison of GAAP and as adjusted results for certain financial measures:

AUM, GAAP and as adjusted results
(Dollar amounts in millions, except per share data)												Six Months Ended June 30,
	Q2 2013			Q2 2012			Change	Q1 2013			Change	2013			2012			Change
AUM	$	3,857,007		$	3,559,934		8%	$	3,936,409		(2%)	$	3,857,007		$	3,559,934		8%
GAAP basis:
Revenue	$	2,482		$	2,229		11%	$	2,449		1%	$	4,931		$	4,478		10%
Operating income	$	849		$	829		2%	$	909		(7%)	$	1,758		$	1,644		7%
Operating margin		34.2	%		37.2	%	(300 bps)		37.1	%	(290 bps)		35.7	%		36.7	%	(100 bps)
Net income(2)	$	729		$	554		32%	$	632		15%	$	1,361		$	1,126		21%
Diluted EPS	$	4.19		$	3.08		36%	$	3.62		16%	$	7.81		$	6.22		26%
Weighted average diluted shares		173,873,583			179,590,702		(3%)		174,561,132		—%		174,268,870			180,753,515		(4%)
As Adjusted:
Operating income(1)	$	982		$	832		18%	$	921		7%	$	1,903		$	1,657		15%
Operating margin(1)		41.3	%		39.2	%	210 bps		40.0	%	130 bps		40.6	%		38.9	%	170 bps
Net income(1)(2)	$	722		$	558		29%	$	637		13%	$	1,359		$	1,133		20%
Diluted EPS(1)	$	4.15		$	3.10		34%	$	3.65		14%	$	7.80		$	6.26		25%

⁽¹⁾ See notes (a) through (f) to the Condensed Consolidated Statements of Income and Supplemental Information on pages 13 through 16 for more information on as adjusted items and the reconciliation to GAAP.

⁽²⁾  Net income represents net income attributable to BlackRock, Inc.

“While markets were volatile this quarter, not all investor behavior was uniform. Our largest institutional investors remain committed to their long-term investment strategies, while trading-oriented clients once again turned to iShares as a highly effective tool to quickly and efficiently adjust their market exposures. iShares flows were driven by clients stepping back from emerging markets equities and long duration fixed income, though outflows in those products were largely offset by flows into the Core Series and our Minimum Volatility suite, resulting in net outflows from iShares of $1 billion for the quarter. Our products provided liquidity and transparency for our clients worldwide, and the record volume of trading in certain of our products reflects our position as the premier provider of highly liquid ETFs.

“We are also seeing the early stages of a rotation within fixed income as investors increasingly focus on the duration of their fixed income portfolios, with flows moving into actively managed, unconstrained products. We have top quartile performance in these areas, with flagship funds like Multi-Asset Income and Strategic Income Opportunities each gathering more than $1 billion in new assets. We continue to leverage our diverse distribution capabilities to deliver superior products to our retail clients, and deepen and develop institutional relationships, as clients look to us to evaluate risk and provide solutions.

“As we highlighted at our inaugural Investor Day, we see a number of exciting growth opportunities across the firm and are continuing our commitment to finding innovative solutions to serve our clients’ needs in changing market conditions. This commitment to innovation is illustrated by the launch of our new iSharesBonds series in April combining the advantages of traditional bonds and ETFs and providing our clients a tool to simplify their fixed income portfolio while managing duration risk. In the second quarter, we also provided funding for a new charitable initiative that will launch in 2014 and deepen our commitment to public responsibility that has always been fundamental to our business.

“We have built a unique platform at BlackRock that is differentiated by the diversity of our clients, geographies and investment strategies, all underpinned with risk management powered by Aladdin. That platform drove more than $51 billion in long-dated net new business in the first half of the year, and we believe it positions us to continue to deliver both for our clients and our shareholders across market cycles.”

Second Quarter Business Highlights

The following table presents net inflows, AUM, base fees and business mix by client and product type:

Net inflows, AUM, base fees and business mix, by client type
(Dollar amounts in millions)	Q2 2013 Net Inflows			June 30,  2013 AUM		Q2 2013 Base  Fees		June 30,  2013 AUM % of Total			Q2 2013 Base  Fees % of Total
Retail	$	5,076		$	414,379	$	697		12	%		33	%
iShares		(963	)		774,397		723		22	%		35	%
Institutional:
Active		1,317			861,231		450		24	%		21	%
Index		6,477			1,514,448		224		42	%		11	%
Total institutional		7,794			2,375,679		674		66	%		32	%
Total long-term	$	11,907		$	3,564,455	$	2,094		100	%		100	%
Net inflows, AUM, base fees and business mix, by product type
(Dollar amounts in millions)	Q2 2013 Net Inflows			June 30,  2013 AUM		Q2 2013 Base  Fees		June 30,  2013 AUM % of Total			Q2 2013 Base  Fees % of Total
Equity	($	348	)	$	1,973,115	$	1,177		55	%		56	%
Fixed income		5,101			1,205,359		503		34	%		24	%
Multi-asset		11,051			289,305		253		8	%		12	%
Alternatives		(3,897	)		96,676		161		3	%		8	%
Total long-term	$	11,907		$	3,564,455	$	2,094		100	%		100	%

Net long-term inflows of $10.5 billion and $3.7 billion from clients in EMEA and Asia-Pacific, respectively, were offset by net outflows of $2.3 billion from Americas (defined as the United States, Caribbean, Canada, Latin America and Iberia) clients. At June 30, 2013, BlackRock managed 61% of long-term AUM for investors in the Americas and 39% for international clients.

-2-

• Retail net long-term inflows of $5.1 billion globally included net inflows of $3.5 billion in the United States and $1.4 billion in EMEA. Growth was largely driven by a strong interest in unconstrained fixed income and multi-asset income offerings. Flagship funds in these areas include our Strategic Income Opportunities and Multi-Asset Income funds, each of which raised over $1 billion in assets during the quarter. Alternative mutual funds also had a strong quarter, with $1.1 billion of net inflows, representing 72% AUM growth over the prior quarter.

• iShares net long-term outflows of $1.0 billion included U.S. iShares net long-term outflows of $3.6 billion due to outflows of $7.2 billion, $2.0 billion and $2.1 billion from our flagship emerging markets equity, fixed income and commodities funds, respectively. These outflows more than offset positive flows of $3.6 billion into the Core Series and $2.0 billion into Minimum Volatility equity funds in the United States and $2.2 billion of equity inflows into European iShares.

• Institutional active net long-term inflows of $1.3 billion reflected strong flows of $8.8 billion into multi-asset class products, driven by continued demand for our LifePath target date suite, which had net inflows of $4.0 billion. Flows were partially offset by combined equity and fixed income net outflows of $4.2 billion, and active currency redemptions of $2.0 billion.

• Institutional index net long-term inflows of $6.5 billion were primarily driven by demand for local currency fixed income products in EMEA and for global bond mandates in Asia-Pacific.

Cash management AUM decreased 3%, or $8.8 billion, to $252.6 billion.

Advisory AUM decreased 13% to $40.0 billion due to planned portfolio liquidations.

Investment performance as of June 30, 2013 is presented in the following table:

Investment performance
	One-year period			Three-year period			Five-year period
Fixed Income:
Actively managed products above benchmark or peer median
Taxable		76	%		80	%		70	%
Tax-exempt		57	%		66	%		74	%
Passively managed products within or above tolerance		94	%		95	%		87	%
Equity:
Actively managed products above benchmark or peer median
Fundamental		42	%		37	%		42	%
Scientific		82	%		94	%		60	%
Passively managed products within or above tolerance		95	%		97	%		95	%

Second Quarter Financial Highlights

PennyMac IPO. At March 31, 2013, BlackRock held an approximately one-third economic equity interest in Private National Mortgage Acceptance Company, LLC (“PNMAC”), which is accounted for as an equity method investment. On May 8, 2013, PennyMac Financial Services, Inc. (“PennyMac”) became the sole managing member of PNMAC in connection with an initial public offering of PennyMac (the “PennyMac IPO”). As a result of the PennyMac IPO, BlackRock recorded a non-cash, non-operating pre-tax gain of $39 million related to the carrying value of its equity method investment. BlackRock was not a seller in the PennyMac IPO.

Charitable Contribution. Subsequent to the PennyMac IPO, the Company made a Charitable Contribution of approximately six million units of its PennyMac investment to a new DAF in the second quarter. The fair value of the Charitable Contribution was $124 million and is included in general and administration expenses on the condensed consolidated statement of income. In connection with the Charitable Contribution, the Company also recorded a non-cash, non-operating pre-tax gain of $80 million related to the contributed investment and a tax benefit of approximately $57 million.

The Company will continue to account for its remaining approximately 20% interest (approximately 16 million units) in PennyMac as an equity method investment.

The general and administration expenses, non-operating gain and associated tax benefit related to the Charitable Contribution have been excluded from as adjusted results, among other items. For more information on as adjusted items and the reconciliation to GAAP, see notes to the Condensed Consolidated Statements of Income.

-3-

The new charitable fund will launch in 2014 and support BlackRock’s philanthropic initiatives to give back to the communities in which the Company operates, including, among other things, helping to promote financial education for low-income families and individuals.

Comparison of the Second Quarter 2013 to the Second Quarter 2012

The following discusses the Company’s results on a GAAP basis:

Operating income: Operating income was $849 million compared with $829 million in the prior year. The current quarter included the $124 million expense related to the Charitable Contribution.

Revenue of $2.5 billion increased $253 million from $2.2 billion in the prior year, primarily due to the following:

• Investment advisory, administration fees and securities lending revenue of $2.2 billion increased $187 million from the prior year due to growth in long-term average AUM. Securities lending fees were $136 million in the current quarter and $157 million in the prior year quarter. The decrease in securities lending fees was driven primarily by lower spreads.

• Performance fees of $89 million increased $48 million, primarily reflecting higher fees from alternative products.

• BlackRock Solutions^® and advisory revenue totaled $138 million, including $98 million of revenue from the Aladdin^® business, compared with $131 million in the prior year quarter, which included $95 million of Aladdin business revenue. The increase primarily reflected higher revenue from Aladdin mandates and higher one-time revenue from advisory assignments.

Total operating expenses of $1.6 billion increased $233 million and included the previously mentioned $124 million related to the Charitable Contribution. Results were primarily driven by the following:

• Employee compensation and benefits increased $78 million, reflecting higher incentive compensation driven by higher operating income, including higher performance fees.

• Direct fund expenses increased $18 million, reflecting an increase in average AUM where BlackRock pays certain non-advisory expenses of the funds.

• General and administration expenses increased $141 million, largely driven by the $124 million related to the Charitable Contribution.

Non-operating income (expense): Non-operating income, net of non-controlling interests, was $92 million compared with $46 million non-operating expense in the prior year quarter. The current quarter included the $39 million gain related to the PennyMac IPO, the $80 million gain related to the Charitable Contribution and $22 million of net positive marks, offset by $49 million of net interest expense.

Income tax expense: Income tax expense totaled $212 million and $229 million for the second quarter 2013 and 2012, respectively. The GAAP effective income tax rate was 22.5% compared with 29.3% for the prior year quarter. The current quarter included the approximately $57 million tax benefit recognized in connection with the Charitable Contribution. In addition, the current quarter included a tax benefit of approximately $29 million, primarily due to the realization of loss carryforwards.

The current quarter as adjusted effective tax rate of 27.3% excluded the $57 million tax benefit related to the Charitable Contribution and included the above mentioned tax benefit of $29 million. Excluding the $29 million tax benefit, the as adjusted effective tax rate was 30.2%.

Comparison of the Second Quarter 2013 to the First Quarter 2013

The following discusses the Company’s results on a GAAP basis:

Operating income: Operating income was $849 million compared with $909 million in the prior quarter. The current quarter included the $124 million expense related to the Charitable Contribution.

Revenue of $2.5 billion increased $33 million from $2.4 billion in the prior quarter, primarily due to the following:

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• Investment advisory, administration fees and securities lending revenue of $2.2 billion increased $48 million, driven by higher long-term average AUM, the effect of one additional revenue day in the quarter and seasonally higher securities lending fees. Securities lending fees were $136 million and $112 million in the second quarter and first quarter, respectively. The increase in securities lending fees was driven by higher seasonal demand.

• Performance fees were $89 million compared with $108 million in the first quarter, primarily reflecting seasonally lower performance fees from alternative products.

• BlackRock Solutions and advisory revenue of $138 million, including $98 million of revenue from the Aladdin business, compared with $126 million in the first quarter, which included $99 million of Aladdin business revenue. The increase primarily reflected higher revenue from advisory assignments.

Total operating expenses of $1.6 billion increased $93 million and included the previously mentioned $124 million related to the Charitable Contribution. Results were primarily driven by the following:

• Employee compensation and benefits decreased $41 million, primarily reflecting lower organizational alignment costs and seasonally lower payroll taxes, partially offset by higher incentive compensation.

• General and administration expenses increased $134 million, primarily due to the $124 million related to the Charitable Contribution, higher brand campaign costs and foreign currency remeasurement. The increase was partially offset by the non-recurrence of closed-end fund launch costs of $16 million (excluding $2 million included in employee compensation and benefits expense) recorded in the previous quarter.

Non-operating income (expense): Non-operating income, net of non-controlling interests, was $92 million compared with $7 million in the first quarter. The current quarter included the $39 million gain related to the PennyMac IPO and the $80 million gain related to the Charitable Contribution, partially offset by lower positive marks primarily on distressed credit/mortgage funds and private equity fund co-investments.

Income tax expense: Income tax expense totaled $212 million and $284 million for the second quarter 2013 and first quarter 2013, respectively. The GAAP effective income tax rate was 22.5% compared with 31.0% for the first quarter. The current quarter included the approximately $57 million tax benefit recognized in connection with the Charitable Contribution. In addition, the current quarter included a tax benefit of approximately $29 million, primarily due to the realization of loss carryforwards.

Teleconference, Webcast and Presentation Information

Chairman and Chief Executive Officer, Laurence D. Fink, and Chief Financial Officer, Gary Shedlin, will host a teleconference call for investors and analysts on Thursday, July 18, 2013, at 9:00 a.m. (Eastern Time). Members of the public who are interested in participating in the teleconference should dial, from the United States, (800) 374-0176, or from outside the United States, (706) 679-8281, shortly before 9:00 a.m. and reference the BlackRock Conference Call (ID Number 14878195). A live, listen-only webcast will also be available via the investor relations section of www.blackrock.com.

Both the teleconference and webcast will be available for replay by 12:30 p.m. (Eastern Time) on Thursday, July 18, 2013 and ending at midnight on Thursday, August 1, 2013. To access the replay of the teleconference, callers from the United States should dial (800) 585-8367 and callers from outside the United States should dial (404) 537-3406 and enter the Conference ID Number 14878195. To access the webcast, please visit the investor relations section of www.blackrock.com.

About BlackRock

BlackRock is a leader in investment management, risk management and advisory services for institutional and retail clients worldwide. At June 30, 2013, BlackRock’s AUM was $3.857 trillion. BlackRock helps clients meet their goals and overcome challenges with a range of products that include separate accounts, mutual funds, iShares^® (exchange-traded funds), and other pooled investment vehicles. BlackRock also offers risk management, advisory and enterprise investment system services to a broad base of institutional investors through BlackRock Solutions^®. Headquartered in New York City, as of June 30, 2013, the firm had approximately 10,700 employees in 30 countries and a major presence in key global markets, including North and South America, Europe, Asia, Australia and the Middle East and Africa. For additional information, please visit the Company’s website at www.blackrock.com.

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Condensed Consolidated Statements of Income and Supplemental Information

(Dollar amounts in millions, except per share data), (unaudited)

	Three Months Ended June 30,						$ Change			Three Months Ended March 31, 2013			$ Change
	2013			2012
Revenue
Investment advisory, administration fees and securities lending revenue	$	2,177		$	1,990		$	187		$	2,129		$	48
Investment advisory performance fees		89			41			48			108			(19	)
BlackRock Solutions and advisory		138			131			7			126			12
Distribution fees		18			20			(2	)		17			1
Other revenue		60			47			13			69			(9	)
Total revenue		2,482			2,229			253			2,449			33
Expenses
Employee compensation and benefits		864			786			78			905			(41	)
Distribution and servicing costs		90			93			(3	)		91			(1	)
Amortization of deferred sales commissions		12			14			(2	)		12			—
Direct fund expenses		162			144			18			161			1
General and administration		465			324			141			331			134
Amortization of intangible assets		40			39			1			40			—
Total expenses		1,633			1,400			233			1,540			93
Operating income		849			829			20			909			(60	)
Non-operating income (expense)
Net gain (loss) on investments		141			(7	)		148			62			79
Net gain (loss) on consolidated variable interest entities		(23	)		11			(34	)		27			(50	)
Interest and dividend income		4			8			(4	)		6			(2	)
Interest expense		(53	)		(52	)		(1	)		(54	)		1
Total non-operating income (expense)		69			(40	)		109			41			28
Income before income taxes		918			789			129			950			(32	)
Income tax expense		212			229			(17	)		284			(72	)
Net income		706			560			146			666			40
Less:
Net income (loss) attributable to non-controlling interests		(23	)		6			(29	)		34			(57	)
Net income attributable to BlackRock, Inc.	$	729		$	554		$	175		$	632		$	97
Weighted-average common shares outstanding (f)
Basic		170,648,731			177,010,239			(6,361,508	)		171,301,800			(653,069	)
Diluted		173,873,583			179,590,702			(5,717,119	)		174,561,132			(687,549	)
Earnings per share attributable to BlackRock, Inc. common stockholders (e) (f)
Basic	$	4.27		$	3.13		$	1.14		$	3.69		$	0.58
Diluted	$	4.19		$	3.08		$	1.11		$	3.62		$	0.57
Cash dividends declared and paid per share	$	1.68		$	1.50		$	0.18		$	1.68		$	0.00
Supplemental information:
AUM (end of period)	$	3,857,007		$	3,559,934		$	297,073		$	3,936,409		($	79,402	)
Shares outstanding (end of period)		170,285,093			172,901,037			(2,615,944	)		171,102,532			(817,439	)
GAAP:
Operating margin		34.2	%		37.2	%		(300) bps			37.1	%		(290) bps
Effective tax rate		22.5	%		29.3	%		(680) bps			31.0	%		(850) bps
As adjusted:
Operating income (a)	$	982		$	832		$	150		$	921		$	61
Operating margin (a)		41.3	%		39.2	%		210 bps			40.0	%		130 bps
Non-operating income (expense), less net income (loss) attributable to non-controlling interests (b)	$	12		($	43	)	$	55		$	3		$	9
Net income attributable to BlackRock, Inc. (c) (d)	$	722		$	558		$	164		$	637		$	85
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (c) (d) (e) (f)	$	4.15		$	3.10		$	1.05		$	3.65		$	0.50
Effective tax rate		27.3	%		29.3	%		(200) bps			31.0	%		(370) bps

See notes (a) through (f) on pages 13-16 for more information on as adjusted items and the reconciliation to GAAP.

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Condensed Consolidated Statements of Income and Supplemental Information

(Dollar amounts in millions, except per share data), (unaudited)

	Six Months Ended June 30,						$ Change
	2013			2012
Revenue
Investment advisory, administration fees and securities lending revenue	$	4,306		$	3,967		$	339
Investment advisory performance fees		197			121			76
BlackRock Solutions and advisory		264			254			10
Distribution fees		35			39			(4	)
Other revenue		129			97			32
Total revenue		4,931			4,478			453
Expenses
Employee compensation and benefits		1,769			1,611			158
Distribution and servicing costs		181			188			(7	)
Amortization of deferred sales commissions		24			30			(6	)
Direct fund expenses		323			296			27
General and administration		796			631			165
Amortization of intangible assets		80			78			2
Total expenses		3,173			2,834			339
Operating income		1,758			1,644			114
Non-operating income (expense)
Net gain (loss) on investments		203			68			135
Net gain (loss) on consolidated variable interest entities		4			(1	)		5
Interest and dividend income		10			17			(7	)
Interest expense		(107	)		(101	)		(6	)
Total non-operating income (expense)		110			(17	)		127
Income before income taxes		1,868			1,627			241
Income tax expense		496			492			4
Net income		1,372			1,135			237
Less:
Net income (loss) attributable to non-controlling interests		11			9			2
Net income attributable to BlackRock, Inc.	$	1,361		$	1,126		$	235
Weighted-average common shares outstanding (f)
Basic		170,973,462			178,016,539			(7,043,077	)
Diluted		174,268,870			180,753,515			(6,484,645	)
Earnings per share attributable to BlackRock, Inc. common stockholders (e) (f)
Basic	$	7.96		$	6.32		$	1.64
Diluted	$	7.81		$	6.22		$	1.59
Cash dividends declared and paid per share	$	3.36		$	3.00		$	0.36
Supplemental information:
AUM (end of period)	$	3,857,007		$	3,559,934		$	297,073
Shares outstanding (end of period)		170,285,093			172,901,037			(2,615,944	)
GAAP:
Operating margin		35.7	%		36.7	%		(100) bps
Effective tax rate		26.7	%		30.4	%		(370) bps
As adjusted:
Operating income (a)	$	1,903		$	1,657		$	246
Operating margin (a)		40.6	%		38.9	%		170 bps
Non-operating income (expense), less net income (loss) attributable to non-controlling interests (b)	$	15		($	28	)	$	43
Net income attributable to BlackRock, Inc. (c) (d)	$	1,359		$	1,133		$	226
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (c) (d) (e) (f)	$	7.80		$	6.26		$	1.54
Effective tax rate		29.1	%		30.4	%		(130) bps

See notes (a) through (f) on pages 13-16 for more information on as adjusted items and the reconciliation to GAAP.

-7-

Assets Under Management

(Dollar amounts in millions), (unaudited)

Current Quarter Component Changes by Client Type and Product

	March 31, 2013		Net subscriptions (redemptions) (1)			Market appreciation (depreciation)			Foreign exchange  (2)			June 30, 2013		Q2 2013 Average AUM(3)
Retail:
Equity	$	169,402	$	(1,753	)	$	(6,068	)	$	(140	)	$	161,441	$	167,174
Fixed income		143,711		2,636			(4,778	)		(28	)		141,541		144,877
Multi-asset		97,373		2,489			(501	)		(256	)		99,105		99,237
Alternatives		10,655		1,704			(66	)		(1	)		12,292		11,321
Retail subtotal		421,141		5,076			(11,413	)		(425	)		414,379		422,609
iShares:
Equity		588,694		2,655			(12,922	)		(1,159	)		577,268		592,653
Fixed income		189,501		(1,449	)		(6,921	)		(188	)		180,943		190,060
Multi-asset		1,035		99			(21	)		(6	)		1,107		1,094
Alternatives		23,546		(2,268	)		(6,188	)		(11	)		15,079		19,187
iShares subtotal		802,776		(963	)		(26,052	)		(1,364	)		774,397		802,994
Institutional:
Active:
Equity		130,138		(2,938	)		361			(1,136	)		126,425		130,545
Fixed income		505,391		(1,269	)		(11,982	)		(1,650	)		490,490		502,573
Multi-asset		175,524		8,778			(4,064	)		72			180,310		179,882
Alternatives		67,688		(3,254	)		26			(454	)		64,006		65,835
Active subtotal		878,741		1,317			(15,659	)		(3,168	)		861,231		878,835
Index:
Equity		1,104,361		1,688			8,013			(6,081	)		1,107,981		1,121,347
Fixed income		406,930		5,183			(16,497	)		(3,231	)		392,385		406,456
Multi-asset		9,634		(315	)		(339	)		(197	)		8,783		9,358
Alternatives		5,672		(79	)		(292	)		(2	)		5,299		5,514
Index subtotal		1,526,597		6,477			(9,115	)		(9,511	)		1,514,448		1,542,675
Long-term		3,629,255		11,907			(62,239	)		(14,468	)		3,564,455		3,647,113
Cash management		261,329		(8,829	)		30			32			252,562
Advisory (4)		45,825		(4,891	)		(114	)		(830	)		39,990
Total	$	3,936,409	$	(1,813	)	$	(62,323	)	$	(15,266	)	$	3,857,007

Current Quarter Component Changes by Product

	March 31, 2013		Net subscriptions (redemptions) (1)			Market appreciation (depreciation)			Foreign exchange  (2)			June 30, 2013		Q2 2013 Average AUM(3)
Equity:
Active	$	291,759	$	(4,333	)	$	(5,863	)	$	(1,231	)	$	280,332	$	290,002
iShares		588,694		2,655			(12,922	)		(1,159	)		577,268		592,653
Fixed income:
Active		648,865		1,367			(16,754	)		(1,670	)		631,808		647,218
iShares		189,501		(1,449	)		(6,921	)		(188	)		180,943		190,060
Multi-asset		283,566		11,051			(4,925	)		(387	)		289,305		289,571
Alternatives:
Core		69,943		406			56			(178	)		70,227		70,146
Currency and commodities (5)		37,618		(4,303	)		(6,576	)		(290	)		26,449		31,711
Sub-total		2,109,946		5,394			(53,905	)		(5,103	)		2,056,332		2,111,361
Non-ETF Index:
Equity		1,112,142		1,330			8,169			(6,126	)		1,115,515		1,129,064
Fixed income		407,167		5,183			(16,503	)		(3,239	)		392,608		406,688
Sub-total Non-ETF Index		1,519,309		6,513			(8,334	)		(9,365	)		1,508,123		1,535,752
Long-term	$	3,629,255	$	11,907		$	(62,239	)	$	(14,468	)	$	3,564,455	$	3,647,113

⁽¹⁾ Amounts include distributions representing return of capital and return on investment to investors.

⁽²⁾ Foreign exchange reflects the impact of converting non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.

⁽³⁾  Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four, seven and thirteen months for quarter-to-date, year-to-date and year-over-year periods, respectively.

⁽⁴⁾ Advisory AUM represents long-term portfolio liquidation assignments.

⁽⁵⁾ Amounts include commodity iShares.

NOTE: Certain prior period information has been reclassified to conform to current period presentation.

-8-

Assets Under Management

(Dollar amounts in millions), (unaudited)

Year-to-Date Component Changes by Client Type and Product

	December 31, 2012		Net subscriptions (redemptions) (1)			Market appreciation (depreciation)			Foreign exchange  (2)			June 30, 2013		Year-to-Date Average  AUM(3)
Retail:
Equity	$	164,748	$	(2,364	)	$	960		$	(1,903	)	$	161,441	$	167,598
Fixed income		138,425		8,073			(4,671	)		(286	)		141,541		143,014
Multi-asset		90,626		5,379			3,511			(411	)		99,105		96,577
Alternatives		9,685		2,783			(16	)		(160	)		12,292		10,718
Retail subtotal		403,484		13,871			(216	)		(2,760	)		414,379		417,907
iShares:
Equity		534,648		28,934			16,952			(3,266	)		577,268		579,771
Fixed income		192,852		(2,465	)		(7,883	)		(1,561	)		180,943		190,317
Multi-asset		869		228			18			(8	)		1,107		1,032
Alternatives		24,337		(2,066	)		(7,149	)		(43	)		15,079		21,466
iShares subtotal		752,706		24,631			1,938			(4,878	)		774,397		792,586
Institutional:
Active:
Equity		129,024		(8,582	)		10,670			(4,687	)		126,425		130,167
Fixed income		518,102		(9,043	)		(10,308	)		(8,261	)		490,490		507,546
Multi-asset		166,708		14,607			2,563			(3,568	)		180,310		175,733
Alternatives		70,861		(5,965	)		668			(1,558	)		64,006		67,684
Active subtotal		884,695		(8,983	)		3,593			(18,074	)		861,231		881,130
Index:
Equity		1,017,081		15,335			98,571			(23,006	)		1,107,981		1,093,366
Fixed income		409,943		5,956			(6,038	)		(17,476	)		392,385		406,494
Multi-asset		9,545		(133	)		108			(737	)		8,783		9,447
Alternatives		4,912		675			(128	)		(160	)		5,299		5,376
Index subtotal		1,441,481		21,833			92,513			(41,379	)		1,514,448		1,514,683
Long-term		3,482,366		51,352			97,828			(67,091	)		3,564,455		3,606,306
Cash management		263,743		(8,663	)		131			(2,649	)		252,562
Advisory (4)		45,479		(4,002	)		(175	)		(1,312	)		39,990
Total	$	3,791,588	$	38,687		$	97,784		$	(71,052	)	$	3,857,007

Year-to-Date Component Changes by Product

	December 31, 2012		Net subscriptions (redemptions) (1)			Market appreciation (depreciation)			Foreign exchange  (2)			June 30, 2013		Year-to-Date Average  AUM(3)
Equity:
Active	$	287,215	$	(11,208	)	$	10,870		$	(6,545	)	$	280,332	$	290,339
iShares		534,648		28,934			16,952			(3,266	)		577,268		579,771
Fixed income:
Active		656,331		(1,013	)		(14,971	)		(8,539	)		631,808		650,337
iShares		192,852		(2,465	)		(7,883	)		(1,561	)		180,943		190,317
Multi-asset		267,748		20,081			6,200			(4,724	)		289,305		282,789
Alternatives:
Core		68,367		1,917			853			(910	)		70,227		69,743
Currency and commodities (5)		41,428		(6,490	)		(7,478	)		(1,011	)		26,449		35,501
Sub-total		2,048,589		29,756			4,543			(26,556	)		2,056,332		2,098,797
Non-ETF Index:
Equity		1,023,638		15,597			99,331			(23,051	)		1,115,515		1,100,792
Fixed income		410,139		5,999			(6,046	)		(17,484	)		392,608		406,717
Sub-total Non-ETF Index		1,433,777		21,596			93,285			(40,535	)		1,508,123		1,507,509
Long-term	$	3,482,366	$	51,352		$	97,828		$	(67,091	)	$	3,564,455	$	3,606,306

⁽¹⁾ Amounts include distributions representing return of capital and return on investment to investors.

⁽²⁾ Foreign exchange reflects the impact of converting non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.

⁽³⁾ Monthly average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four, seven and thirteen months for quarter-to-date, year-to-date and year-over-year periods, respectively.

⁽⁴⁾ Advisory AUM represents long-term portfolio liquidation assignments.

⁽⁵⁾ Amounts include commodity iShares.

NOTE: Certain prior period information has been reclassified to conform to current period presentation.

-9-

Assets Under Management

(Dollar amounts in millions), (unaudited)

Year-over-Year Component Changes by Client Type and Product

	June 30, 2012		Net subscriptions (redemptions)  (1) (7)			Market appreciation (depreciation) (6)			Foreign exchange  (2)			June 30, 2013		Thirteen Month Average AUM(3)
Retail:
Equity	$	154,835	$	(4,034	)	$	11,529		$	(889	)	$	161,441	$	164,129
Fixed income		123,397		18,566			(318	)		(104	)		141,541		137,629
Multi-asset		86,372		5,194			7,867			(328	)		99,105		92,859
Alternatives		9,404		2,890			54			(56	)		12,292		10,084
Retail subtotal		374,008		22,616			19,132			(1,377	)		414,379		404,701
iShares:
Equity		443,311		79,522			54,978			(543	)		577,268		531,848
Fixed income		180,355		5,205			(4,478	)		(139	)		180,943		188,715
Multi-asset		712		353			47			(5	)		1,107		921
Alternatives		20,530		430			(5,883	)		2			15,079		22,375
iShares subtotal		644,908		85,510			44,664			(685	)		774,397		743,859
Institutional:
Active:
Equity		126,589		(18,057	)		21,518			(3,625	)		126,425		128,982
Fixed income		507,449		(16,332	)		6,672			(7,299	)		490,490		512,356
Multi-asset		147,409		20,952			12,591			(642	)		180,310		166,299
Alternatives		68,547		(10,935	)		8,207			(1,813	)		64,006		68,920
Active subtotal		849,994		(24,372	)		48,988			(13,379	)		861,231		876,557
Index:
Equity		917,948		29,032			180,976			(19,975	)		1,107,981		1,032,973
Fixed income		454,875		(57,990	)		5,285			(9,785	)		392,385		417,844
Multi-asset		8,594		267			837			(915	)		8,783		9,240
Alternatives		5,091		411			(112	)		(91	)		5,299		5,247
Index subtotal		1,386,508		(28,280	)		186,986			(30,766	)		1,514,448		1,465,304
Long-term		3,255,418		55,474			299,770			(46,207	)		3,564,455		3,490,421
Cash management		239,471		12,821			737			(467	)		252,562
Advisory (4)		65,045		(24,030	)		(655	)		(370	)		39,990
Total	$	3,559,934	$	44,265		$	299,852		$	(47,044	)	$	3,857,007

Year-over-Year Component Changes by Product

	June 30, 2012		Net subscriptions (redemptions)  (1) (7)			Market appreciation (depreciation) (6)			Foreign exchange  (2)			June 30, 2013		Thirteen Month Average AUM(3)
Equity:
Active	$	274,670	$	(21,726	)	$	31,878		$	(4,490	)	$	280,332	$	286,206
iShares		443,311		79,522			54,978			(543	)		577,268		531,848
Fixed income:
Active		630,639		2,205			6,359			(7,395	)		631,808		649,768
iShares		180,355		5,205			(4,478	)		(139	)		180,943		188,715
Multi-asset		243,087		26,766			21,342			(1,890	)		289,305		269,319
Alternatives:
Core		63,575		(1,053	)		8,356			(651	)		70,227		68,110
Currency and commodities (5)		39,997		(6,151	)		(6,090	)		(1,307	)		26,449		38,516
Sub-total		1,875,634		84,768			112,345			(16,415	)		2,056,332		2,032,482
Non-ETF Index:
Equity		924,702		28,667			182,145			(19,999	)		1,115,515		1,039,878
Fixed income		455,082		(57,961	)		5,280			(9,793	)		392,608		418,061
Sub-total Non-ETF Index		1,379,784		(29,294	)		187,425			(29,792	)		1,508,123		1,457,939
Long-term	$	3,255,418	$	55,474		$	299,770		$	(46,207	)	$	3,564,455	$	3,490,421

⁽¹⁾ Amounts include distributions representing return of capital and return on investment to investors.

⁽²⁾ Foreign exchange reflects the impact of converting non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.

⁽³⁾  Monthly average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four, seven and thirteen months for quarter-to-date, year-to-date and year-over-year periods, respectively.

⁽⁴⁾ Advisory AUM represents long-term portfolio liquidation assignments.

⁽⁵⁾ Amounts include commodity iShares.

⁽⁶⁾ Amounts include $6.1 billion of AUM acquired from Swiss Re Private Equity Partners in September 2012.

⁽⁷⁾ Amounts include the effect of a single low-fee fixed income passive outflow of $74.2 billion in third quarter 2012.

NOTE: Certain prior period information has been reclassified to conform to current period presentation.

-10-

Summary of Revenues

(Dollar amounts in millions), (unaudited)

	Three Months Ended June 30,				$ Change			Three Months Ended March 31, 2013		$ Change			Six Months Ended June 30,				$ Change
	2013		2012										2013		2012
Investment advisory, administration fees and securities lending revenue
Equity:
Active	$	432	$	429	$	3		$	433	($	1	)	$	865	$	882	($	17	)
iShares		584		467		117			571		13			1,155		940		215
Fixed income:
Active		322		285		37			312		10			634		564		70
iShares		120		107		13			116		4			236		205		31
Multi-asset		253		236		17			248		5			501		479		22
Alternatives:
Core		136		130		6			136		—			272		265		7
Currency and commodities		25		32		(7	)		30		(5	)		55		66		(11	)
Sub-total		1,872		1,686		186			1,846		26			3,718		3,401		317
Non-ETF Index:
Equity		161		156		5			140		21			301		279		22
Fixed income		61		60		1			57		4			118		110		8
Sub-total Non-ETF Index		222		216		6			197		25			419		389		30
Long-term		2,094		1,902		192			2,043		51			4,137		3,790		347
Cash management		83		88		(5	)		86		(3	)		169		177		(8	)
Total base fees		2,177		1,990		187			2,129		48			4,306		3,967		339
Investment advisory performance fees:
Equity		17		3		14			17		—			34		22		12
Fixed income		9		10		(1	)		1		8			10		16		(6	)
Multi-asset		3		1		2			7		(4	)		10		4		6
Alternatives		60		27		33			83		(23	)		143		79		64
Total		89		41		48			108		(19	)		197		121		76
BlackRock Solutions and advisory		138		131		7			126		12			264		254		10
Distribution fees		18		20		(2	)		17		1			35		39		(4	)
Other revenue		60		47		13			69		(9	)		129		97		32
Total revenue	$	2,482	$	2,229	$	253		$	2,449	$	33		$	4,931	$	4,478	$	453

NOTE: Certain prior period information has been reclassified to conform to current period presentation.

-11-

Summary of Non-operating Income (Expense)

(Dollar amounts in millions), (unaudited)

	Three Months Ended June 30,						$ Change			Three  Months Ended March 31, 2013		$ Change			Six Months Ended June 30,					$ Change
	2013			2012											2013		2012
Non-operating income (expense), GAAP basis	$	69		($	40	)	$	109		$	41	$	28		$	110	($	17	)	$	127
Less: Net income (loss) attributable to NCI		(23	)		6			(29	)		34		(57	)		11		9			2
Non-operating income (expense)(1)	$	92		($	46	)	$	138		$	7	$	85		$	99	($	26	)	$	125

	Estimated economic investments at June 30, 2013(2)	Three Months Ended June 30,						$ Change			Three Months Ended March 31, 2013			$ Change			Six Months Ended June 30,						$ Change
		2013			2012												2013			2012
Net gain (loss) on investments(1)
Private equity	20-25%	$	4		($	4	)	$	8		$	19		($	15	)	$	23		$	17		$	6
Real estate	5-10%		7			3			4			3			4			10			4			6
Distressed credit/mortgage funds	15-20%		4			—			4			19			(15	)		23			28			(5	)
Hedge funds/funds of hedge funds	10-15%		5			4			1			3			2			8			10			(2	)
Other investments(3)	35-40%		2			(2	)		4			7			(5	)		9			(3	)		12
Sub-total			22			1			21			51			(29	)		73			56			17
Gain related to PennyMac IPO			39			—			39			—			39			39			—			39
Gain related to the Charitable Contribution			80			—			80			—			80			80			—			80
Investments related to deferred compensation plans			—			(3	)		3			4			(4	)		4			2			2
Total net gain (loss) on investments(1)			141			(2	)		143			55			86			196			58			138
Interest and dividend income			4			8			(4	)		6			(2	)		10			17			(7	)
Interest expense			(53	)		(52	)		(1	)		(54	)		1			(107	)		(101	)		(6	)
Net interest expense			(49	)		(44	)		(5	)		(48	)		(1	)		(97	)		(84	)		(13	)
Total non-operating income (expense)(1)			92			(46	)		138			7			85			99			(26	)		125
Gain related to the Charitable Contribution			(80	)		—			(80	)		—			(80	)		(80	)		—			(80	)
Compensation expense related to (appreciation) depreciation on deferred compensation plans			—			3			(3	)		(4	)		4			(4	)		(2	)		(2	)
Non-operating income (expense), as adjusted(1)		$	12		($	43	)	$	55		$	3		$	9		$	15		($	28	)	$	43

⁽¹⁾ Net of net income (loss) attributable to NCI.

⁽²⁾ Percentages represent estimated percentages of BlackRock’s corporate economic investment portfolio as of June 30, 2013. Economic investment amounts at March 31, 2013 for private equity, real estate, distressed credit/mortgage funds, hedge funds/funds of hedge funds and other investments were $306 million, $120 million, $202 million, $164 million and $410 million, respectively. See the 2013 first quarter Form 10-Q for more information.

⁽³⁾ Amounts include net gains (losses) related to equity, fixed income and commodity investments, and BlackRock’s seed capital hedging program.

Economic Tangible Assets

(Dollar amounts in billions), (unaudited)

The Company presents economic tangible assets as additional information to enable investors to eliminate gross presentation of certain assets that have equal and offsetting liabilities or non-controlling interests that ultimately do not have an impact on stockholders’ equity (excluding appropriated retained earnings related to consolidated collateralized loan obligations) or cash flows. In addition, goodwill and intangible assets are excluded from economic tangible assets.

	June 30, 2013 (Est.)			December 31, 2012
Total balance sheet assets	$	193		$	200
Separate account assets and separate account collateral held under securities lending agreements		(152	)		(158	)
Consolidated VIEs/sponsored investment funds		(3	)		(2	)
Goodwill and intangible assets, net		(30	)		(30	)
Economic tangible assets	$	8		$	10

Economic tangible assets include cash, receivables, seed and co-investments, regulatory investments and other assets.

-12-

Notes to Condensed Consolidated Statements of Income and Supplemental Information (unaudited)

BlackRock reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”); however, management believes evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP basis financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and, for the reasons described below, considers them to be effective indicators, for both management and investors, of BlackRock’s financial performance over time. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

Computations for all periods are derived from the Company’s condensed consolidated statements of income as follows:

(a) Operating income, as adjusted, and operating margin, as adjusted:

Operating income, as adjusted, equals operating income, GAAP basis, excluding certain items management deems non-recurring, or transactions that ultimately will not impact BlackRock’s book value, as indicated in the table below. Operating income used for operating margin measurement equals operating income, as adjusted, excluding the impact of closed-end fund launch costs and commissions. Operating margin, as adjusted, equals operating income used for operating margin measurement, divided by revenue (net of distribution and servicing costs and amortization of deferred sales commissions) used for operating margin measurement, as indicated in the table below.

Management believes operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock’s financial performance over time and, therefore, provide useful disclosure to investors.

Operating income, as adjusted and operating margin, as adjusted

	Three Months Ended									Six Months Ended June 30,
	June 30,						March  31, 2013
(Dollar amounts in millions)	2013			2012						2013			2012
Operating income, GAAP basis	$	849		$	829		$	909		$	1,758		$	1,644
Non-GAAP expense adjustments:
Charitable Contribution		124			—			—			124			—
PNC LTIP funding obligation		9			6			8			17			11
Compensation expense related to appreciation (depreciation) on deferred compensation plans		—			(3	)		4			4			2
Operating income, as adjusted		982			832			921			1,903			1,657
Closed-end fund launch costs		—			—			16			16			—
Closed-end fund launch commissions		—			—			2			2			—
Operating income used for operating margin measurement	$	982		$	832		$	939		$	1,921		$	1,657
Revenue, GAAP basis	$	2,482		$	2,229		$	2,449		$	4,931		$	4,478
Non-GAAP adjustments:
Distribution and servicing costs		(90	)		(93	)		(91	)		(181	)		(188	)
Amortization of deferred sales commissions		(12	)		(14	)		(12	)		(24	)		(30	)
Revenue used for operating margin measurement	$	2,380		$	2,122		$	2,346		$	4,726		$	4,260
Operating margin, GAAP basis		34.2	%		37.2	%		37.1	%		35.7	%		36.7	%
Operating margin, as adjusted		41.3	%		39.2	%		40.0	%		40.6	%		38.9	%

-13-

Notes to Condensed Consolidated Statements of Income and Supplemental Information (unaudited)

(continued)

(a) (continued)

• Operating income, as adjusted: Operating income, as adjusted reflects the non-GAAP expense adjustments discussed below. The $124 million expense related to the Charitable Contribution has been excluded from operating income, as adjusted due to its non-recurring nature and because the non-cash, non-operating pre-tax gain of $80 million related to the contributed PennyMac investment is reported in non-operating income (expense). The portion of compensation expense associated with certain long-term incentive plans (“LTIP”) funded or to be funded through share distributions to participants of BlackRock stock held by PNC has been excluded because it ultimately does not impact BlackRock’s book value. Compensation expense associated with appreciation (depreciation) on investments related to certain BlackRock deferred compensation plans has been excluded as returns on investments set aside for these plans, which substantially offset this expense, are reported in non-operating income (expense).

Management believes operating income exclusive of these items is a useful measure in evaluating BlackRock’s operating performance and helps enhance the comparability of this information for the reporting periods presented.

• Operating margin, as adjusted: Operating income used for measuring operating margin, as adjusted, is equal to operating income, as adjusted, excluding the impact of closed-end fund launch costs and commissions. Management believes the exclusion of such costs and commissions is useful because these costs can fluctuate considerably and revenues associated with the expenditure of these costs will not fully impact BlackRock’s results until future periods.

Operating margin, as adjusted, allows BlackRock to compare performance from period-to-period by adjusting for items that may not recur, recur infrequently or may have an economic offset in non-operating income (expense). Examples of such adjustments include commissions paid to certain employees as compensation and fluctuations in compensation expense based on mark-to-market movements in investments held to fund certain compensation plans. BlackRock also uses operating margin, as adjusted, to monitor corporate performance and efficiency and as a benchmark to compare its performance with other companies. Management uses both GAAP and non-GAAP financial measures in evaluating the financial performance of BlackRock. The non-GAAP measure by itself may pose limitations because it does not include all of BlackRock’s revenues and expenses.

Revenue used for operating margin, as adjusted, excludes distribution and servicing costs paid to related parties and other third parties. Management believes the exclusion of such costs is useful because it creates consistency in the treatment for certain contracts for similar services, which due to the terms of the contracts, are accounted for under GAAP on a net basis within investment advisory, administration fees and securities lending revenue. Amortization of deferred sales commissions is excluded from revenue used for operating margin measurement, as adjusted, because such costs, over time, substantially offset distribution fee revenue earned by the Company. For each of these items, BlackRock excludes from revenue used for operating margin, as adjusted, the costs related to each of these items as a proxy for such offsetting revenues.

-14-

Notes to Condensed Consolidated Statements of Income and Supplemental Information (unaudited)

(continued)

(b) Non-operating income (expense), less net income (loss) attributable to non-controlling interests, as adjusted: Non-operating income (expense), less net income (loss) attributable to non-controlling interests (“NCI”), as adjusted, is presented below. The compensation expense offset is recorded in operating income. This compensation expense has been included in non-operating income (expense), less net income (loss) attributable to NCI, as adjusted, to offset returns on investments set aside for these plans, which are reported in non-operating income (expense), GAAP basis.

Management believes non-operating income (expense), less net income (loss) attributable to NCI, as adjusted, provides comparability of this information among reporting periods and is an effective measure for reviewing BlackRock’s non-operating contribution to its results. As compensation expense associated with (appreciation) depreciation on investments related to certain deferred compensation plans, which is included in operating income, substantially offsets the gain (loss) on the investments set aside for these plans, management believes non-operating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure, for both management and investors, of BlackRock’s non-operating results that impact book value. The non-cash, non-operating pre-tax gain of $80 million related to the contributed PennyMac investment has been excluded from non-operating income (expense), less net income (loss) attributable to NCI, as adjusted due to its non-recurring nature and because the more than offsetting associated Charitable Contribution expense of $124 million is reported in operating income.

Non-operating income (expense), less net income (loss) attributable to NCI, as adjusted

	Three Months Ended									Six Months  Ended June 30,
	June 30,						March  31, 2013
	2013			2012						2013			2012
(Dollar amounts in millions)
Non-operating income (expense), GAAP basis	$	69		($	40	)	$	41		$	110		($	17	)
Less: Net income (loss) attributable to NCI		(23	)		6			34			11			9
Non-operating income (expense), net of NCI		92			(46	)		7			99			(26	)
Gain related to the Charitable Contribution		(80	)		—			—			(80	)		—
Compensation expense related to (appreciation) depreciation on deferred compensation plans		—			3			(4	)		(4	)		(2	)
Non-operating income (expense), less net income (loss) attributable to NCI, as adjusted	$	12		($	43	)	$	3		$	15		($	28	)

-15-

Notes to Condensed Consolidated Statements of Income and Supplemental Information (unaudited)

(continued)

(c) Net income attributable to BlackRock, Inc., as adjusted: Management believes net income attributable to BlackRock, Inc., as adjusted, and diluted earnings per common share, as adjusted, are useful measures of BlackRock’s profitability and financial performance. Net income attributable to BlackRock, Inc., as adjusted, equals net income attributable to BlackRock, Inc., GAAP basis, adjusted for significant non-recurring items, charges that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

See note (a) Operating income, as adjusted, and operating margin, as adjusted, for information on the Charitable Contribution and the PNC LTIP funding obligation.

The three and six months ended June 30, 2013 included a tax benefit of approximately $57 million recognized in connection with the Charitable Contribution. The tax benefit has been excluded from net income attributable to BlackRock, Inc., as adjusted due to the non-recurring nature of the Charitable Contribution.

Net income attributable to BlackRock, Inc., as adjusted

	Three Months Ended							Six Months Ended June 30,
(Dollar amounts in millions, except per share data)	June 30,					March 31, 2013
	2013			2012				2013			2012
Net income attributable to BlackRock, Inc., GAAP basis	$	729		$	554	$	632	$	1,361		$	1,126
Non-GAAP adjustments, net of tax:(d)
Amount related to the Charitable Contribution		(13	)		—		—		(13	)		—
PNC LTIP funding obligation		6			4		5		11			7
Net income attributable to BlackRock, Inc., as adjusted	$	722		$	558	$	637	$	1,359		$	1,133
Allocation of net income, as adjusted, to common shares(e)	$	722		$	557	$	637	$	1,359		$	1,131
Diluted weighted-average common shares outstanding(f)		173,873,583			179,590,702		174,561,132		174,268,870			180,753,515
Diluted earnings per common share, GAAP basis(f)	$	4.19		$	3.08	$	3.62	$	7.81		$	6.22
Diluted earnings per common share, as adjusted(f)	$	4.15		$	3.10	$	3.65	$	7.80		$	6.26

(d) For the quarters ended June 30, 2013 and 2012 and March 31, 2013, the PNC LTIP funding obligation non-GAAP adjustment was tax effected at 30.2%, 30.4% and 31.0%, respectively, reflecting a blended rate applicable to the adjustment. For the six months ended June 30, 2013 and 2012, the PNC LTIP funding obligation non-GAAP adjustments were tax effected at 31.0%. The three and six months ended June 30, 2013 also included a tax benefit of approximately $57 million related to the Charitable Contribution.

(e) For the three and six months ended June 30, 2012, amounts exclude net income attributable to participating securities (see below).

(f) Non-voting participating preferred shares are considered to be common stock equivalents for purposes of determining basic and diluted earnings per share calculations.

Prior to the first quarter 2013, certain unvested restricted stock units were not included in diluted weighted-average common shares outstanding as they were deemed participating securities in accordance with required provisions of Accounting Standards Codification (“ASC”) 260-10, Earnings per Share. Average outstanding participating securities were 0.2 million for the quarter and six months ended June 30, 2012.

-16-

Forward-looking Statements

This press release, and other statements that BlackRock may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

In addition to risk factors previously disclosed in BlackRock’s Securities and Exchange Commission (“SEC”) reports and those identified elsewhere in this press release the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: (1) the introduction, withdrawal, success and timing of business initiatives and strategies; (2) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management; (3) the relative and absolute investment performance of BlackRock’s investment products; (4) the impact of increased competition; (5) the impact of future acquisitions or divestitures; (6) the unfavorable resolution of legal proceedings; (7) the extent and timing of any share repurchases; (8) the impact, extent and timing of technological changes and the adequacy of intellectual property, information and cyber security protection; (9) the impact of legislative and regulatory actions and reforms, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock or The PNC Financial Services Group, Inc. (“PNC”); (10) terrorist activities, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (11) the ability to attract and retain highly talented professionals; (12) fluctuations in the carrying value of BlackRock’s economic investments; (13) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products or transactions, which could affect the value proposition to clients and, generally, the tax position of the Company; (14) BlackRock’s success in maintaining the distribution of its products; (15) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (16) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

BlackRock’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and BlackRock’s subsequent filings with the SEC, accessible on the SEC’s website at www.sec.gov and on BlackRock’s website at www.blackrock.com, discuss these factors in more detail and identify additional factors that can affect forward-looking statements. The information contained on the Company’s website is not a part of this press release.

Performance Notes

Past performance is not indicative of future results. The performance information shown is based on preliminarily available data. The performance information for actively managed accounts shown reflects U.S. open-end and closed-end mutual funds and similar EMEA-based products with respect to peer median comparisons, and actively managed institutional and high net worth separate accounts and funds located globally with respect to benchmark comparisons, as determined using objectively based internal parameters, using the most current verified information available as of June 30, 2013 (May 31, 2013 for high net worth accounts).

Accounts terminated prior to June 30, 2013 are not included. In addition, accounts that have not been verified as of July 12, 2013 have not been included. If such terminated and other accounts had been included, the performance information may have substantially differed from that shown. The performance information does not include funds or accounts that are not measured against a benchmark, any benchmark-based alternatives product, private equity products, CDOs, or accounts managed by BlackRock’s Financial Markets Advisory Group. Comparisons are based on gross-of-fee performance for U.S. retail, institutional and high net worth separate accounts and EMEA institutional separate accounts and net-of-fee performance for EMEA based retail products. The performance tracking information for institutional index accounts is based on gross-of-fee performance as of June 30, 2013, and includes all institutional accounts and all iShares funds globally using an index strategy. AUM information is based on AUM for each account or fund in the asset class shown without adjustment for overlapping management of the same account or fund, as of June 30, 2013.

-17-

Source of performance information and peer medians is BlackRock, Inc. and is based in part on data from Lipper Inc. for U.S. funds and Morningstar, Inc. for non-U.S. funds. Fund performance reflects the reinvestment of dividends and distributions, but does not reflect sales charges.

-18-

EX-99.2

Q2 2013 Earnings

Press Release Supplement

July 18, 2013

1

Important Notes

This

presentation,

and

other

statements

that

BlackRock

may

make,

may

contain

forward-looking

statements

within

the

meaning

of

the

Private

Securities

Litigation

Reform

Act,

with

respect

to

BlackRock’s

future

financial

or

business

performance,

strategies

or

expectations.

Forward-looking

statements

are

typically

identified

by

words

or

phrases

such

as

“trend,”

“potential,”

“opportunity,”

“pipeline,”

“believe,”

“comfortable,”

“expect,”

“anticipate,”

“current,”

“intention,”

“estimate,”

“position,”

“assume,”

“outlook,”

“continue,”

“remain,”

“maintain,”

“sustain,”

“seek,”

“achieve,”

and

similar

expressions,

or

future

or

conditional

verbs

such

as

“will,”

“would,”

“should,”

“could,”

“may”

and

similar

expressions.

BlackRock

cautions

that

forward-looking

statements

are

subject

to

numerous

assumptions,

risks

and

uncertainties,

which

change

over

time.

Forward-

looking

statements

speak

only

as

of

the

date

they

are

made,

and

BlackRock

assumes

no

duty

to

and

does

not

undertake

to

update

forward-looking

statements.

Actual

results

could

differ

materially

from

those

anticipated

in

forward-looking

statements

and

future

results

could

differ

materially

from

historical

performance.

In

addition

to

risk

factors

previously

disclosed

in

BlackRock’s

Securities

and

Exchange

Commission

(“SEC”)

reports

and

those

identified

elsewhere

in

this

presentation

the

following

factors,

among

others,

could

cause

actual

results

to

differ

materially

from

forward-looking

statements

or

historical

performance:

(1)

the

introduction,

withdrawal,

success

and

timing

of

business

initiatives

and

strategies;

(2)

changes

and

volatility

in

political,

economic

or

industry

conditions,

the

interest

rate

environment,

foreign

exchange

rates

or

financial

and

capital

markets,

which

could

result

in

changes

in

demand

for

products

or

services

or

in

the

value

of

assets

under

management;

(3)

the

relative

and

absolute

investment

performance

of

BlackRock’s

investment

products;

(4)

the

impact

of

increased

competition;

(5)

the

impact

of

future

acquisitions

or

divestitures;

(6)

the

unfavorable

resolution

of

legal

proceedings;

(7)

the

extent

and

timing

of

any

share

repurchases;

(8)

the

impact,

extent

and

timing

of

technological

changes

and

the

adequacy

of

intellectual

property,

information

and

cyber

security

protection;

(9)

the

impact

of

legislative

and

regulatory

actions

and

reforms,

including

the

Dodd-Frank

Wall

Street

Reform

and

Consumer

Protection

Act,

and

regulatory,

supervisory

or

enforcement

actions

of

government

agencies

relating

to

BlackRock

or

The

PNC

Financial

Services

Group,

Inc.

(“PNC”);

(10)

terrorist

activities,

international

hostilities

and

natural

disasters,

which

may

adversely

affect

the

general

economy,

domestic

and

local

financial

and

capital

markets,

specific

industries

or

BlackRock;

(11)

the

ability

to

attract

and

retain

highly

talented

professionals;

(12)

fluctuations

in

the

carrying

value

of

BlackRock’s

economic

investments;

(13)

the

impact

of

changes

to

tax

legislation,

including

income,

payroll

and

transaction

taxes,

and

taxation

on

products

or

transactions,

which

could

affect

the

value

proposition

to

clients

and,

generally,

the

tax

position

of

BlackRock;

(14)

BlackRock’s

success

in

maintaining

the

distribution

of

its

products;

(15)

the

impact

of

BlackRock

electing

to

provide

support

to

its

products

from

time

to

time

and

any

potential

liabilities

related

to

securities

lending

or

other

indemnification

obligations;

and

(16)

the

impact

of

problems

at

other

financial

institutions

or

the

failure

or

negative

performance

of

products

at

other

financial

institutions.

This

presentation

also

includes

non-GAAP

financial

measures.

You

can

find

our

presentations

on

the

most

directly

comparable

GAAP

financial

measures

calculated

in

accordance

with

GAAP

and

our

reconciliations

in

the

appendix

to

this

earnings

release

supplement,

our

current

earnings

release

dated

July

18,

2013,

and

BlackRock’s

other

periodic

reports,

which

are

available

on

BlackRock’s

web

site

at

www.blackrock.com.

2

Table of Contents

Operating

and

Net

Income/Diluted

EPS,

as

adjusted

Page 3

Operating

Margin,

as

adjusted

Page 4

Q2

2013

Mix

by

Product,

Client

Type,

Style

and

Region

Page 5

Major

Market

Indices

and

Exchange

Rates

Page 6

Year-over-Year:

Q2

2013

vs.

Q2

2012

Pages 7-12

Sequential

Quarters:

Q2

2013

vs.

Q1

2013

Pages 13-18

Non-operating

and

Capital

Management

Pages 19-21

Appendix

Pages 22-29

3

EPS up 34% and operating income up 18% year-over-year

Operating and Net Income, as adjusted ($ in millions)

Diluted Earnings Per Share, as adjusted

For

further

information

and

reconciliation

between

GAAP

and

as

adjusted,

see

the

appendix,

notes

(a)

through

(f)

in

the

current

earnings

release

as

well

as

previously

filed

Form

10-Ks,

10-Qs

and

8-Ks.

•

Q2 2013 EPS reflects a $39 million non-cash, non-operating pre-tax gain related to the PennyMac IPO

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

4

Continued margin improvement

Operating

Margin,

as

adjusted

For

further

information

and

reconciliation

between

GAAP

and

as

adjusted,

see

the

appendix,

notes

(a)

through

(f)

in

the

current

earnings

release

as

well

as

previously

filed

Form

10-Ks,

10-Qs

and

8-Ks.

•

Sequential

results

reflect

seasonal

factors

primarily

related

to

higher

securities

lending

fees,

lower

payroll

taxes

and

lower

performance

fees

•

Q2

2013

and

Q1

2013

include

$9

million

and

$33

million

of

organizational

alignment

costs,

respectively

•

Amounts

related

to

the

PennyMac

Charitable

Contribution

have

been

excluded

from

as

adjusted

results,

among

other

items

5

A broadly diversified business across clients, products and geographies

Q2 2013 Long-term Base Fees of $2.094 billion

Long-term Assets Under Management of $3.564 trillion at June 30, 2013

Product Type

Client Type

Style

Region

Alternatives 3%

Alternatives 8%

Multi-asset

8%

Multi-asset

12%

Fixed Income

34%

Fixed Income

24%

Equity

55%

Equity

56%

iShares

22%

iShares

35%

Retail

12%

Retail

33%

Institutional

66%

Institutional

32%

AUM

Base Fees

AUM

Base Fees

Index

42%

Index

11%

iShares

22%

iShares

35%

Asia-Pacific

8%

Asia

-

Pacific 5%

EMEA

31%

EMEA

30%

Americas

61%

Americas

65%

Active

36%

Active

54%

AUM

Base Fees

AUM

Base Fees

6

Major market indices and exchange rates

Spot

Spot

June 30, 2013

vs.

Average Level

Average

Q2 2013 vs.

June 30,

2013

March 31,

2013

March 31,

2013

Q2 2013

Q2 2012

Q1 2013

Q2 2012

Q1 2013

Equity Indices:

Domestic

S&P 500

1,606

1,569

2.4%

1,610

1,350

1,513

19.3%

6.4%

Global

MSCI Barra World Index

1,434

1,435

(0.1%)

1,463

1,233

1,405

18.7%

4.1%

MSCI Europe Index

98

101

(3.0%)

101

86         

100

17.4%

1.0%

MSCI AC Asia Pacific Index

131

136

(3.7%)

136

118          

133

15.3%

2.0%

MSCI Emerging Markets Index

940

1,035

(9.1%)

1,004

963             1,059

4.2%

(5.2%)

S&P Global Natural Resources

3,083

3,415

(9.7%)

3,295

3,209

3,524

2.7%

(6.5%)

Fixed Income Index:

Barclays U.S. Aggregate Bond Index

1,799

1,842

(2.3%)

1,839

1,800

1,837

2.2%

0.1%

Foreign Exchange Rates:

GBP to USD

1.52

1.52

0.1%

1.54

1.58

1.55

(3.0%)

(1.0%)

EUR to USD

1.30

1.28

1.5%

1.31

1.28

1.32

1.8%

(1.1%)

Source: Bloomberg

Year-over-year

Q2 2013 vs. Q2 2012

*

*

*

*

*

*

*

*

*

*

*

8

Q2 2013 Compared to Q2 2012, as adjusted

EPS up 34% year-over-year driven by an increase in operating income of 18%

For

further

information

and

reconciliation

between

GAAP

and

as

adjusted,

see

the

appendix

and

notes

(a)

through

(f)

in

the

current

earnings

release.

•

Q2 2013 EPS reflects a $39 million non-cash, non-operating pre-tax gain related to the PennyMac IPO

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

9

Q2 2013 Compared to Q2 2012, as adjusted

Operating results reflect record base fees and margin expansion

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

10

Revenue reflects record base fees and higher performance fees

Q2 2013 Compared to Q2 2012

Total Revenue

Q2 2012

$2.23 billion

Q2 2013

$2.48 billion

11

Base fees (including securities lending) reflect growth across all traditional long-term

asset classes

Q2 2013 Compared to Q2 2012

Base fees

12

Expenses driven by higher revenue-related expenses

Expenses, as adjusted, by Category

Q2 2013 Compared to Q2 2012, as adjusted

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

(1) Compensation & benefits expense excludes organizational alignment costs incurred in Q2 2013, which is presented separately above.

(1)

Sequential Quarters

Q2 2013 vs. Q1 2013

************************

************************

************************

************************

************************

************************

************************

************************

************************

************************

************************

***********************

14

Results reflect base fee growth and seasonal factors

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

Q2 2013 Compared to Q1 2013, as adjusted

•

Sequential results reflect seasonal factors primarily related to

higher securities lending fees, lower payroll taxes and lower performance fees

•

Q2 2013 and Q1 2013 include $9 million and $33 million of organizational alignment costs, respectively

•

Q1 2013 included $18 million of pre-tax fund launch costs

•

Q2 2013 EPS reflects a $39 million non-cash, non-operating pre-tax gain related to the PennyMac IPO

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

15

Operating income reflects record base fees, margin expansion and

seasonal factors

Q2 2013 Compared to Q1 2013 , as adjusted

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

•

Sequential results reflect seasonal factors primarily related to

higher securities lending fees, lower payroll taxes and lower performance fees

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

16

Higher revenue driven by record base fees and seasonally higher securities lending

Q2 2013 Compared to Q1 2013

Total Revenue

17

Base fees (including securities lending) reflects growth from higher average AUM

Base Fees

Q2 2013 Compared to Q1 2013

18

Expenses reflects seasonal factors

(1)

Compensation & benefits expense excludes organizational alignment costs incurred in Q1 2013 and Q2 2013, which are presented separately above. G&A expense excludes Q1 2013 fund launch

costs, which are also presented separately above.

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

Expenses, as adjusted, by Category

Q2 2013 Compared to Q1 2013, as adjusted

•

Sequential results reflect seasonal factors primarily related to

lower payroll taxes

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

Non-operating and Capital Management

******

******

******

******

******

******

******

******

******

******

******

*****

20

Q2 2013 $12 million Non-Operating Income by Category, as adjusted

Q2 2013 non-operating income

$4

$4

$7

$5

$2

$39

($49)

($60)

($50)

($40)

($30)

($20)

($10)

$0

$10

$20

$30

$40

Private Equity

Real Estate

Distressed

Credit/ Mortgage

Funds

Hedge Funds/

Funds of Hedge

Funds

Other

Investments

Non-cash Gain

Related to

PennyMac IPO

Net Interest

Expense

For further information and reconciliation between GAAP and as adjusted, see the appendix and notes (a) through (f) in the current earnings release.

Net Interest Expense

Investment Gains

$22 million Net Investment Gain

•

Amounts related to the PennyMac Charitable Contribution have been excluded from as adjusted results, among other items

21

Continued commitment to sound capital management

Operating cash flow

Share repurchases

Amounts above exclude repurchases of employee tax withholdings related to employee stock transactions.

Total payout ratio

Dividends and Dividend Payout Ratio

Payout ratio = (Dividends declared + shares repurchases) / GAAP Net income.

For further information and reconciliation between GAAP and as adjusted, see the previously filed Form 10-Ks,

Form 10-Qs and 8-Ks and the appendix to this earnings release supplement.

Dividend payout ratio = Dividends declared / GAAP Net income.

Appendix

*

*

*

*

*

*

*

*

*

*

*

*

23

Q2 2013 long-term AUM up 9% from Q2 2012

Q2 2013 Compared to Q2 2012

Long-term AUM

(1)

Net new business excludes the effect of a single low-fee non-ETP index fixed income outflow of $74.2 billion in the third quarter 2012, which is shown separately above.

(2)

Market includes $6.1 billion of AUM acquired from Swiss Re Private Equity Partners in September 2012.

24

Q2 2013 long-term AUM down 2% from Q1 2013

Q2 2013 Compared to Q1 2013

Long-term AUM

25

Quarterly operating income –

GAAP and as adjusted

Operating Income ($ in millions)

Non-GAAP Adjustments ($ in millions)

Non-GAAP adjustments include amounts related to the PennyMac Charitable Contribution, a contribution to short-term

investment funds (“STIFs”), PNC LTIP funding obligation and compensation related to appreciation (depreciation) on

certain deferred compensation plans.

For further information and reconciliation between GAAP and as adjusted, see notes (a) through (f) in the current earnings release as well as previously filed Form 10-Ks, 10-Qs and 8-Ks.

26

Quarterly net income –

GAAP and as adjusted

Net Income ($ in millions)

Non-GAAP Adjustments ($ in millions)

Non-GAAP adjustments include amounts related to the PennyMac Charitable Contribution,  a contribution to STIFs, PNC

LTIP funding obligation and income tax changes.

For further information and reconciliation between GAAP and as adjusted, see notes (a) through (f) in the current earnings release as well as previously filed Form 10-Ks, 10-Qs and 8-Ks.

27

Quarterly non-operating income (expense) –

GAAP and as adjusted

Non-Operating Income (Expense) ($ in millions)

Non-GAAP Adjustments ($ in millions)

Non-GAAP adjustments include net income (loss) attributable to non-controlling interests, a gain associated with the

PennyMac Charitable Contribution and compensation expense related to (appreciation) depreciation on certain deferred

compensation plans.

For further information and reconciliation between GAAP and as adjusted, see notes (a) through (f) in the current earnings release as well as previously filed Form 10-Ks, 10-Qs and 8-Ks.

28

Q2 2013 PennyMac Financial Impact

Both GAAP and as adjusted  results include a $39 million non-cash, pre-tax gain related to the carrying value of the Company’s equity method investment in PennyMac in connection with PennyMac’s initial

public offering.

29

Cash Flow GAAP and As Adjusted

(in millions)

2010

2011

2012

YTD

Q2 2012

EST YTD

Q2 2013

Operating Cash Flows

Operating Cash flows, GAAP basis

$2,488

$2,826

$2,240

$865

$1,300

Less: Non-GAAP adjustments

(1)

(77)

178

(483)

51

200

Operating Cash flows, as Adjusted

$2,565

$2,648

$2,723

$814

$1,100

Investing Cash Flows

Investing Cash flows, GAAP basis

($627)

($204)

($266)

($547)

$-

Less: Non-GAAP adjustments

(1)

(52)

24

(211)

(184)

-

Investing Cash flows, as  Adjusted

($575)

($228)

($55)

($363)

$-

Financing Cash Flows

Financing Cash flows, GAAP basis

($3,170)

($2,485)

($944)

($235)

($2,200)

Less: Non-GAAP adjustments

(1)

110

(71)

631

(3)

(100)

Financing Cash flows, as Adjusted

($3,280)

($2,414)

($1,575)

($232)

($2,100)

(1)

Non-GAAP

adjustments

include

the

impact

on

cash

flows

of

consolidated

sponsored

investment

funds

and

consolidated

VIEs

.

*

*

*

*

*

*

*

*

*

*

*

* * * * * * * * * *