'BlackRock Largest Shareholder' PNC to Sell Entire Stake... "70x Profit"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] PNC Financial, the largest shareholder of asset management company 'BlackRock,' is selling all of its shares after 25 years.

According to the Wall Street Journal (WSJ) and others on the 11th (local time), PNC Financial announced that it will sell all of its 22% stake in BlackRock. PNC Financial, which purchased the shares for $240 million in 1995, is selling them for $17 billion. This translates to a profit of more than 70 times the original investment.

PNC Financial is one of the major U.S. banks headquartered in Pittsburgh.

This decision to sell came as U.S. banks were building loan loss reserves to cover potential losses amid the impact of the COVID-19 pandemic. PNC Financial increased its loan loss reserves to about $914 million in the first quarter of this year, five times the previous amount, resulting in a 28% decrease in net income.

William Demchak, CEO of PNC Financial, stated, "Since PNC acquired the stake, BlackRock has created significant value through strong performance and growth," adding, "We judged that now is the right time to realize the value of our investment."

The WSJ commented, "This sale symbolizes the end of an era when BlackRock was owned by various banks," and evaluated that "BlackRock has become a major power on Wall Street in its own right."

This content was produced with the assistance of AI translation services.