BlackRock Inc is planning to announce lower fees on some of its core iShares exchange-traded funds in the fourth quarter, Chief Executive Officer Laurence Fink said on Monday.
The changes will only apply to some ETFs with lower-fee competition and will not be a "wholesale fee change on everything," Fink told attendees of the Barclays' Global Financial Services Conference in New York.
Exchange-traded funds are baskets of securities, like mutual funds, but they trade on exchanges, like individual securities. They are cheaper than mutual funds and allow investors to trade throughout the day, with simultaneous pricing, unlike mutual funds, which price at the end of the day.
Over the past few years, BlackRock's iShares ETFs have been losing U.S. retail market share as Vanguard Group has been aggressively rolling out cheaper ETFs [ID: nL2E8I9368].
Despite its plans to reduce its fees on some ETFs, BlackRock still anticipates its margins to grow to more than 40 percent in the near future, Fink said.
"Those products are going to have reduced fees and reduced margins ... but we still have increasing margins in some of our other ETF products," he said. "The key is about building out more innovative products."
Shares of BlackRock were down 0.2 percent at $181.68 in early trading.
Copyright 2010 by Reuters. All rights reserved.
Copyright 2013 Thomson Reuters. Click For Restrictions