“Many of BlackRock’s clients will experience cost savings through decreased operating expenses at the fund level,” Derek Stein, senior managing director and head of business operations and technology at BlackRock, said in the statement.
JPMorgan had $20 trillion assets under custody at the end of 2016. The deal may help the bank increase its revenue in securities services business. The New York-based bank experts to bring more assets in over the next two years.
State Street had been served as BlackRock’s custodian since 1988. The Boston-based company had $28.8 trillion in custody and administration in the fourth quarter last year. It is the second largest custody bank in the world. The bank on Wednesday said its fourth-quarter revenue dropped 3.4 percent, pushing its stock down more than 3.7 percent in the early trading.