BlackRock, the world’s largest money manager by assets under management, has filed documents and is in talks with the Securities and Exchange Commission as it seeks an expansion of its broker-dealer operation that will put it in direct competition with traditional Wall Street banks, according to a person familiar with the situation.
BlackRock last year launched an internal trading platform designed to save investors money by executing trades within the group, which has $3.5tn assets under management. It now plans to allow customers of its advisory business, BlackRock Solutions, to trade bonds electronically.
The firm’s desire to expand its trading business was revealed in the Financial Times in September 2009, at a time when Larry Fink, BlackRock’s founder and chief executive, criticised Wall Street’s “luxurious” trading profits, particularly in a post-crisis landscape with fewer groups competing for business.
Other asset managers also run trading operations. Fidelity has long operated a broker dealer within its capital markets arm, and runs its own system for executing stock trades away from the traditional exchanges.