BlackRock freezes hiring, reduces spending, CFO says

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BlackRock Chief Financial Officer Gary Shedlin said Tuesday that the world's largest investment manager is freezing most hiring and reducing spending.

"We're trying to be a little more prudent," Shedlin explained during a financial conference hosted by Goldman Sachs.

He said these measures would help put the global investment management company in a better position next year. 

BlackRock also said there were some short-term performance challenges and that it needed to think about resetting expenses in relation to revenues. 

A sign hangs on the BlackRock offices on January 16, 2014, in New York City.  (Andrew Burton/Getty Images / Getty Images)

TEXAS SUBPOENAS BLACKROCK FOR DOCUMENTS RELATED TO ESG PUSH

Shedlin pointed out the firm has seen some weakness in retail mutual funds — but BlackRock expects to see a sizable ramp-up in performance fees from illiquid businesses in the future.

On its Oct. 13 third-quarter earnings call, he first announced the changes amid "very challenged" market conditions.

He said that the company had begun to "more aggressively manage the pace of certain discretionary spend."

BlackRock

FLORIDA DIVESTING $2 BILLION FROM BLACKROCK OVER FIRM'S ESG PUSH

BlackRock previously reported third quarter revenue fell 15% to $4.3 billion, primarily driven by the impact of significantly lower markets and dollar appreciation on average assets under management and lower performance fees.

Average assets under management totaled $8.479 trillion at September 30, down from $8.478 trillion at end June.

Earnings per share also fell 15%, reflecting a lower effective tax rate and a lower diluted share count, partially offset by lower non-operating income, in the current quarter.

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Reuters contributed to this report.

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