Forward-looking Statements

This report, 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" or 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 report 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 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 capital improvement projects; (6) the impact of future acquisitions or divestitures; (7) the unfavorable resolution of legal proceedings; (8) the extent and timing of any share repurchases; (9) the impact, extent and timing of technological changes and the adequacy of intellectual property protection; (10) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock, Barclays PLC, Bank of America Corporation, Merrill Lynch & Co., Inc. or The PNC Financial Services Group, Inc.;
(11) terrorist activities and international hostilities, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (12) the ability to attract and retain highly talented professionals; (13) fluctuations in the carrying value of BlackRock's investments; (14) fluctuations in foreign currency exchange rates, which may adversely affect the value of investment advisory and administration fees earned by BlackRock or the carrying value of certain assets and liabilities denominated in foreign currencies; (15) the impact of changes to tax legislation and, generally, the tax position of the Company; (16) BlackRock's success in maintaining the distribution of its products; (17) the impact of BlackRock electing to provide support to its products from time to time; (18) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions; and (19) the ability of BlackRock to complete the transaction with Barclays Bank PLC and integrate the operations of Barclays Global Investors.

Overview

BlackRock, Inc. ("BlackRock" or the "Company") is one of the largest publicly traded investment management firms in the world with $1.435 trillion of assets under management ("AUM") at September 30, 2009. BlackRock manages assets on behalf of institutional and individual investors worldwide through a variety of fixed income, cash management, equity and balanced and alternative investment separate accounts and funds. In addition, BlackRock Solutions® provides market risk management, financial markets advisory and enterprise investment system services to a broad base of clients. Financial markets advisory services include valuation of illiquid securities, dispositions and workout assignments (including long-term portfolio liquidation assignments), risk management and strategic planning and execution.

On January 1, 2009, Bank of America Corporation ("Bank of America") acquired Merrill Lynch & Co., Inc. ("Merrill Lynch"). In connection with this transaction, BlackRock entered into exchange agreements with each of Merrill Lynch and The PNC Financial Services Group, Inc. ("PNC") pursuant to which each agreed to exchange a portion of the BlackRock voting common stock they held for non-voting preferred stock. On September 30, 2009, Bank of America/Merrill Lynch owned approximately 4.6% of BlackRock's voting common stock and 46.1% of BlackRock's capital stock on a fully diluted basis, and PNC owned approximately 43.8% of BlackRock's voting common stock and 30.7% of BlackRock's capital stock on a fully diluted basis.

On June 16, 2009, BlackRock announced that Barclays Bank PLC ("Barclays") accepted its offer to acquire all of the outstanding equity interests of subsidiaries of Barclays conducting the business of Barclays Global Investors ("BGI") and entered into a definitive purchase agreement to acquire BGI from Barclays (the "BGI Transaction"). The purchase price consideration consists of $6.6 billion in cash, subject to certain adjustments, and approximately 37.8 million shares of common and participating preferred stock, subject to certain adjustments. The cash portion of the transaction will be financed by $800 million from BlackRock's cash position, a new $2 billion credit facility, which is expected to eventually be replaced with term debt, $1 billion of additional short-term debt, and $2.8 billion of capital from a group of institutional investors, including PNC. The shares of common stock and total capital stock issued to Barclays pursuant to the BGI Transaction will represent approximately 4.9% of the common stock and 19.9% of the total capital stock of BlackRock outstanding immediately following the closing of the BGI Transaction.

The following table summarizes BlackRock's operating performance for each of the three months ended September 30, 2009, June 30, 2009 and September 30, 2008 and the nine months ended September 30, 2009 and 2008. Certain prior year amounts have been revised or reclassified to conform to 2009 presentation as required by the retrospective adoption of the applicable paragraphs within Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 470-20, Debt with Conversion and Other Options issued ("ASC 470-20"), (FASB Staff Position ("FSP") APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)), ASC 260-10, Earnings per Share ("ASC 260-10") (FSP Emerging Issues Task Force ("EITF") 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities) and ASC 810-10, Consolidation ("ASC 810-10")(Statement of Financial Accounting Standards ("SFAS") No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of ARB No. 51). For more information please refer to the Company's Annual Report on Form 10K for the year ended December 31, 2008, which was filed with the Securities and Exchange Commission ("SEC") on March 2, 2009 and the Company's Current Report on Form 8-K, which updated the financial information in the Company's Annual Report on Form 10-K for the year ended December 31, 2008, which was filed with the SEC on September 17, 2009.

                                                                     Three Months Ended                                               Variance vs. Three Months Ended
                                                             September 30,                      June 30,                 September 30, 2008                       June 30, 2009
                                                      2009                  2008                  2009                Amount             % Change            Amount            % Change
GAAP basis:
Total revenue                                     $       1,140         $       1,313         $       1,029         $      (173 )             (13 )%       $       111               11 %
Total expenses                                    $         783         $         859         $         768         $       (76 )              (9 )%       $        15                2 %
Operating income                                  $         357         $         454         $         261         $       (97 )             (21 )%       $        96               37 %
Operating margin                                           31.3 %                34.6 %                25.4 %              (3.3 )%             (9 )%               5.9 %             23 %
Non-operating income (expense), less net
income (loss) attributable to
non-controlling interests                         $          61         $        (120 )       $          51         $       181               151 %        $        10               20 %
Net income attributable to BlackRock, Inc.        $         317         $         217         $         218         $       100                46 %        $        99               45 %
Diluted earnings per common share(e)              $        2.27         $        1.59         $        1.59         $      0.68                43 %        $      0.68               43 %
As adjusted:
Operating income(a)                               $         400         $         432         $         302         $       (32 )              (7 )%       $        98               32 %
Operating margin(a)                                        40.1 %                38.4 %                34.4 %               1.7 %               4 %                5.7 %             17 %
Non-operating income (expense), less net
income (loss) attributable to
non-controlling interests(b)                      $          52         $         (81 )       $          42         $       133               164 %        $        10               24 %
Net income attributable to BlackRock,
Inc.(c),(d)                                       $         293         $         229         $         239         $        64                28 %        $        54               23 %
Diluted earnings per common share(c),(d),(e)      $        2.10         $        1.67         $        1.75         $      0.43                26 %        $      0.35               20 %
Other:
Diluted weighted-average common shares
outstanding(e)                                      135,902,241           132,270,351           133,364,611           3,631,890                 3 %          2,537,630                2 %
Assets under management                           $   1,434,769         $   1,258,598         $   1,373,160         $   176,171                14 %        $    61,609                4 %

                                BlackRock, Inc.

                        Financial Highlights-(continued)

              (Dollar amounts in millions, except per share data)

                                  (unaudited)



                                                                                     Variance vs. Nine
                                             Nine Months Ended                          Months Ended
                                               September 30,                         September 30, 2008
                                         2009                 2008               Amount             % Change
GAAP basis:
Total revenue                        $       3,156        $       4,000        $      (844 )              (21 )%
Total expenses                       $       2,267        $       2,745        $      (478 )              (17 )%
Operating income                     $         889        $       1,255        $      (366 )              (29 )%
Operating margin                              28.2 %               31.4 %             (3.2 )%             (10 )%
Non-operating income (expense),
less net income (loss)
attributable to non-controlling
interests                            $         (45 )      $        (129 )      $        84                 65 %
Net income attributable to
BlackRock, Inc.                      $         619        $         732        $      (113 )              (15 )%
Diluted earnings per common
share(e)                             $        4.50        $        5.36        $     (0.86 )              (16 )%

As adjusted:
Operating income(a)                  $       1,009        $       1,292        $      (283 )              (22 )%
Operating margin(a)                           37.4 %               37.9 %             (0.5 )%              (1 )%
Non-operating income (expense),
less net income (loss)
attributable to non-controlling
interests(b)                         $         (59 )      $        (114 )      $        55                 48 %
Net income attributable to
BlackRock, Inc.(c),(d)               $         642        $         766        $      (124 )              (16 )%
Diluted earnings per common
share(c),(d),(e)                     $        4.66        $        5.61        $     (0.95 )              (17 )%

Other:
Diluted weighted-average common
shares outstanding(e)                  134,001,799          131,998,448          2,003,351                  2 %
Assets under management              $   1,434,769        $   1,258,598        $   176,171                 14 %

BlackRock reports its financial results on a GAAP basis; however, management believes that 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.

Certain prior period non-GAAP data has been reclassified to conform to the current presentation. 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 deemed non-recurring by management 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 used for operating margin measurement, as indicated in the table below.

                                                     Three Months Ended                    Nine Months Ended
                                               September 30,            June 30,             September 30,
                                            2009          2008            2009            2009           2008
Operating income, GAAP basis               $   357       $   454       $      261       $     889       $ 1,255
Non-GAAP adjustments:
Restructuring charges                           -             -                -               22            -
PNC LTIP funding obligation                     15            14               15              45            44
Merrill Lynch compensation contribution          3             3                2               8             8
Barclays Global Investors ("BGI")
transaction/integration costs                   16            -                15              31            -
Compensation expense related to
(depreciation) appreciation on deferred
compensation plans                               9           (39 )              9              14           (15 )

Operating income, as adjusted                  400           432              302           1,009         1,292
Closed-end fund launch costs                    -             -                -                2             9
Closed-end fund launch commissions              -             -                -                1            -

Operating income used for operating
margin measurement                         $   400       $   432       $      302       $   1,012       $ 1,301

Revenue, GAAP basis                        $ 1,140       $ 1,313       $    1,029       $   3,156       $ 4,000
Non-GAAP adjustments:
Portfolio administration and servicing
costs                                         (119 )        (149 )           (125 )          (371 )        (455 )
Amortization of deferred mutual fund
sales commissions                              (23 )         (34 )            (26 )           (76 )         (97 )
Reimbursable property management
compensation                                    -             (6 )             -               -            (18 )

Revenue used for operating margin
measurement                                $   998       $ 1,124       $      878       $   2,709       $ 3,430

Operating margin, GAAP basis                  31.3 %        34.6 %           25.4 %          28.2 %        31.4 %

Operating margin, as adjusted                 40.1 %        38.4 %           34.4 %          37.4 %        37.9 %

Management believes that operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock's performance over time. As such, management believes that operating income, as adjusted, and operating margin, as adjusted, provide useful disclosure to investors.

Operating income, as adjusted:

Restructuring charges recorded in 2009 consist of compensation costs, occupancy costs and professional fees and have been deemed non-recurring by management and thus have been excluded from operating income, as adjusted, to help ensure the comparability of this information to prior periods. BGI transaction/integration costs recorded in 2009 consist principally of certain advisory fees, legal fees and consulting expenses incurred in conjunction with the announced transaction. As such, management believes that operating margins exclusive of these costs are useful measures in evaluating BlackRock's operating performance for the respective periods.

The portion of compensation expense associated with certain long-term incentive plans ("LTIP") that will be funded through the distribution to participants of shares of BlackRock stock held by PNC and the Merrill Lynch compensation contribution, a portion of which has been received, have been excluded because these charges ultimately do not impact BlackRock's book value.

Compensation expense associated with appreciation (depreciation) on assets 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.

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 that excluding 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 the Company's results until future periods.

Operating margin, as adjusted, allows the Company to compare performance from period-to-period by adjusting for items that may not recur, recur infrequently or may fluctuate based on market movements, such as restructuring charges, transaction/integration costs, closed-end fund launch costs and fluctuations in compensation expense based on mark-to-market movements in investments held to fund certain compensation plans. The Company also uses operating margin, as adjusted, to monitor corporate performance and efficiency and as a benchmark to compare its performance to other companies. Management uses both the GAAP and non-GAAP financial measures. The non-GAAP measures by themselves may pose limitations because they do not include all of the Company's revenues and expenses.

Revenue used for operating margin, as adjusted, excludes portfolio administration and servicing costs paid to related parties and to other third parties. Management believes that excluding such costs is useful because the Company receives offsetting revenue for these services. Amortization of deferred mutual fund sales commissions is excluded from revenue used for operating margin measurement, as adjusted, because such costs, over time, offset distribution fee revenue earned by the Company. Reimbursable property management compensation represented compensation and benefits paid to personnel of Metric Property Management, Inc. ("Metric"), a subsidiary of BlackRock Realty Advisors, Inc. ("Realty"). These employees were retained on Metric's payroll when certain properties were acquired by Realty's clients. The related compensation and benefits were fully reimbursed by Realty's clients and have been excluded from revenue used for operating margin, as adjusted, because they bear no economic cost to BlackRock. 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 revenues.

(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, as adjusted, equals non-operating income (expense), GAAP basis, less net income (loss) attributable to non-controlling interests, GAAP basis, adjusted for compensation expense associated with depreciation (appreciation) on assets related to certain BlackRock deferred compensation plans. 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 non-controlling interests, as adjusted, to offset returns on investments set aside for these plans, which are reported in non-operating income (expense), GAAP basis.

                                                        Three Months Ended                 Nine Months Ended
                                                   September 30,          June 30,           September 30,
                                                 2009         2008          2009           2009           2008
Non-operating income (expense), GAAP basis      $    78      $ (141 )    $       77      $    (24 )      $ (165 )
Net income (loss) attributable to
non-controlling interests, GAAP basis                17         (21 )            26            21           (36 )

Non-operating income (expense), less net
income (loss) attributable to non-controlling
interests                                            61        (120 )            51           (45 )        (129 )
Compensation expense related to
(appreciation) depreciation on deferred
compensation plans                                   (9 )        39              (9 )         (14 )          15

Non-operating income (expense), less net
income (loss) attributable to non-controlling
interests, as adjusted                          $    52      $  (81 )    $       42      $    (59 )      $ (114 )

Management believes that non-operating income (expense), less net income (loss) attributable to non-controlling interests, as adjusted, provides for comparability of this information to prior periods and is an effective measure for reviewing BlackRock's non-operating contribution to its results. As compensation expense associated with depreciation (appreciation) on assets related to certain BlackRock deferred compensation plans, which is included in operating income, offsets the gain/(loss) on the investments set aside for these plans, management believes that non-operating income (expense), less net income
(loss) attributable to non-controlling interests, as adjusted, provides useful measures to investors of BlackRock's non-operating results.

(c) Net income attributable to BlackRock, Inc., as adjusted:

Management believes that net income attributable to BlackRock, Inc., as adjusted, and diluted common earnings per 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 as well as charges that ultimately will not impact BlackRock's book value.

                                                     Three Months Ended                                   Nine Months Ended
                                             September 30,                     June 30,                     September 30,
                                      2009                   2008                2009                2009                   2008
Net income attributable to
BlackRock, Inc., GAAP basis       $         317          $         217       $         218       $         619          $         732
Non-GAAP adjustments, net
. . .