BlackRock says reducing leverage in LDI funds

LONDON (Reuters) – U.S. asset management group BlackRock said on Friday it was reducing leverage in so-called liability-driven investment funds – which have been at the centre of chaotic market conditions for British pension funds this week.

“As a result of the extreme volatility in the gilts market this week, we have been working expediently over recent days to support our clients’ interests,” a BlackRock spokesperson said in an emailed statement.

“We have been reducing leverage in some of our LDI funds, acting prudently to preserve our clients’ capital in extraordinary market conditions.”

“Trading in BlackRock funds has not been halted, nor has BlackRock ceased trading in gilts.”

(Reporting by Carolyn Cohn, writing by Iain Withers, editing by Elaine Hardcastle)