BlackRock halts purchases of Russian securities in active and index funds

BlackRock Inc, the world's largest asset manager, said it had halted purchase of all Russian securities in its active and index funds as of Monday after Russia's invasion of Ukraine.
 

It has "proactively advocated" with "index providers to remove Russian securities from broad-based indices," Rich Kushel, head of the portfolio management group and Salim Ramji, global head of iShares and index investments, said in a joint statement on Thursday. Russian securities account for less than 0.01% of their clients' assets, they said.

Western sanctions on Moscow after it invaded Ukraine last week have prompted a wave of investors to announce they were cutting positions in Russia. Canadian asset manager Purpose Investments said on Thursday it had divested all direct holdings of Russian companies as of Feb. 28 and pledged to stop new investments as long as Russia's invasion continued.
 

Efforts by investors to cut positions have been complicated, however, by a Russian ban on local brokers from selling securities held by foreigners. BlackRock said earlier this week it was consulting with regulators, index providers, and other market participants to ensure its clients could exit their positions in Russian securities, where allowed.
 

Major index providers FTSE Russell and MSCI said on Wednesday they were removing Russian equities from all their indexes. FTSE Russell said the decision will be effective from March 7, while MSCI said its decision will be implemented in one step across all MSCI indexes as of the close of trading on March 9.
 

"We will continue actively consulting with regulators, index providers and other market participants to help ensure our clients can exit their positions in Russian securities, whenever and wherever regulatory and market conditions allow," the Thursday statement said.
 

BlackRock CEO Larry Fink said in a LinkedIn posting that while the company did not have offices or operations in Ukraine or Russia, it was what doing what it can to provide support to colleagues and their families who have been directly impacted. "BlackRock and its people have also rallied to provide financial assistance to Ukrainian refugees on the ground," Fink wrote.