BlackRock Financial Management, Inc.

Item 1 Cover Page

BlackRock Financial Management, Inc.

Park Avenue Plaza

55 East 52nd Street

New York, NY 10055 212-810-5300

March 27, 2013

This Brochure provides information about the qualifications and business practices of BlackRock Financial Management, Inc. as well as certain other affiliated registered investment adviser subsidiaries of BlackRock, Inc. (together with its subsidiaries, "BlackRock"). If you have any questions about the contents of this Brochure, please contact BlackRock Financial Management, Inc. at 212-810-5300. The information in this Brochure has not been approved or verified by the United States Securities and Exchange Commission ("SEC") or by any state securities authority. BlackRock Financial Management, Inc. is registered as an investment adviser with the SEC. Registration as an investment adviser does not imply any level of skill or training. Additional information about BlackRock Financial Management, Inc. is available on the SEC's website at adviserinfo..

Item 2 Material Changes

Item 2 Material Changes

Below is a summary of changes, deemed to be material, that were made to the Brochure from March 30, 2012 through March 27, 2013. On March 30, 2012, the Brochure was updated to reflect that on January 20, 2012, BlackRock Institutional Trust Company, N.A. ("BTC"), a management person of BlackRock Financial Management, Inc., as that term is defined for purposes of the Brochure, entered into an Offer of Settlement with the Commodities Futures Trading Commission ("CFTC"), without admitting or denying wrongdoing, under which BTC agreed to the imposition of a $250,000 penalty and the entry of an Order to resolve allegations by the CFTC that two trades by BTC violated Section 4c(a)(1) of the Commodity Exchange Act and CFTC Regulation 1.38(a). BTC also agreed to cease and desist from any further violations of these statutes. The CFTC did not allege that any clients of BTC, BlackRock or any related affiliate were harmed in any way in the execution of these two trades. The principal item within the Brochure that was updated on March 30, 2012 was Item 9 ("Disciplinary Information"). On July 12, 2012, the Brochure was updated to reflect that on May 29, 2012, BlackRock, Inc. repurchased from Barclays Bank PLC. (together with its subsidiaries, "Barclays") the ownership interest that Barclays previously held in BlackRock, Inc. ("Barclays Repurchase"). Prior to the transaction, Barclays owned approximately 19.6% of the total capital stock of BlackRock, Inc. and approximately 2.2% of BlackRock, Inc.'s voting common stock (as of March 31, 2012). While Barclays was not considered an affiliate of BlackRock for purposes of the Investment Advisers Act of 1940, as amended, or the Investment Company Act of 1940, as amended, at the time, this Brochure had described the relationships or arrangements with Barclays because its interest in BlackRock, Inc. created a possible conflict of interest or the appearance of a conflict of interest between the Advisers (as defined below) and a client. Barclays exited its entire ownership position in BlackRock, Inc. as a result of the Barclays Repurchase. The principal items within the Brochure that were updated on July 12, 2012 included Item 10 ("Other Financial Industry Activities and Affiliations") and Item 11 ("Code of Ethics, Participation or Interest in Client Transactions and Personal Trading").

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Item 3 Table of Contents

Item 3 Table of Contents

Item 1 Cover Page........................................................................................................................i Item 2 Material Changes.............................................................................................................ii Item 3 Table of Contents ...........................................................................................................iii Item 4 Advisory Business ..........................................................................................................1

OVERVIEW OF BLACKROCK REGISTERED INVESTMENT ADVISERS ....................................1 ADVISORY SERVICES .................................................................................................................1

Institutional Separate Accounts and Separately Managed Accounts ..............................3 SERVICES OF AFFILIATES..........................................................................................................4

Item 5 Fees and Compensation .................................................................................................6 ADVISORY FEES..........................................................................................................................6 FEE SCHEDULES.........................................................................................................................6 US Registered Funds......................................................................................................6 Private Funds..................................................................................................................6 Institutional Separate Accounts.......................................................................................6 Private Investors Accounts..............................................................................................6 Separately Managed Accounts (Other than Private Investors Accounts)........................9 Dual Contract SMA Program Accounts...........................................................................9 TIMING AND PAYMENT OF ADVISORY FEES ..........................................................................10 OTHER FEES AND EXPENSES .................................................................................................11

Item 6 Performance-Based Fees and Side-By-Side Management ........................................12 Item 7 Types of Clients.............................................................................................................13

OVERVIEW OF CLIENTS ...........................................................................................................13 US Registered Funds....................................................................................................14 Private Funds................................................................................................................14 Other Pooled Investment Vehicles................................................................................16 Separately Managed Accounts .....................................................................................16

Item 8 Methods of Analysis, Investment Strategies and Risk of Loss .................................17 FIXED INCOME MANDATES ......................................................................................................17 EQUITY MANDATES ..................................................................................................................18 CASH MANAGEMENT MANDATES ...........................................................................................18 ALTERNATIVE MANDATES .......................................................................................................18 MULTI-ASSET MANDATES ........................................................................................................18 INDEX MANDATES.....................................................................................................................18 OTHER STRATEGIES ................................................................................................................19 Borrowing and Leverage ...............................................................................................19 INVESTMENT STRATEGY RISKS..............................................................................................19

Item 9 Disciplinary Information................................................................................................22

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Item 3 Table of Contents

Item 10 Other Financial Industry Activities and Affiliations..................................................23 AFFILIATED BROKER-DEALERS...............................................................................................23 CFTC - COMMODITY POOL OPERATOR / COMMODITY TRADING ADVISOR........................23 RELATIONSHIPS OR ARRANGEMENTS WITH AFFILIATES AND/OR RELATED PERSONS ..23 Securities Lending ........................................................................................................25 Transition Investment Management..............................................................................25 BlackRock Alternative Investors....................................................................................26 BlackRock Solutions? ...................................................................................................26

Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading....................................................................................................................................... 27

BLACKROCK'S ADVISORY EMPLOYEE INVESTMENT TRANSACTION POLICY AND OTHER ETHICAL RESTRICTIONS ..........................................................................................................28 OUTSIDE ACTIVITIES ................................................................................................................29 POLITICAL CONTRIBUTIONS....................................................................................................29 POTENTIAL CONFLICTS RELATING TO ADVISORY ACTIVITIES............................................29

Financial or Other Interests in Underlying Funds ..........................................................30 Cross Trades ................................................................................................................30 Inconsistent Investment Positions and Timing of Competing Transactions ..................30 Conflicts Relating to Portfolio Management of Various Accounts .................................31 SIDE-BY-SIDE MANAGEMENT ..................................................................................................31 MANAGEMENT OF INDEX FUNDS ............................................................................................32 CERTAIN PRINCIPAL TRANSACTIONS IN CONNECTION WITH THE ORGANIZATION OF A PRIVATE FUND AND BLACKROCK US FUND ..........................................................................32 POTENTIAL RESTRICTIONS AND CONFLICTS RELATING TO INFORMATION POSSESSED OR PROVIDED BY BLACKROCK ...............................................................................................33 Availability of Proprietary Information............................................................................33 Material Non-Public Information/Insider Trading ...........................................................33 POTENTIAL CONFLICTS THAT MAY ARISE WITH RESPECT TO SERVICES PROVIDED BY OR THROUGH VARIOUS BLACKROCK ENTITIES AND THE PNC AFFILIATES......................34 Services Provided to a BlackRock Client by other BlackRock Investment Advisers or through Investments in a BlackRock Investment Product .............................................35 BlackRock's Registered Investment Companies, Private Funds and Other Investment Products ........................................................................................................................ 35 Rule 12b-1 Plans of BlackRock US Registered Funds and Additional Payments .........37 Use of PNC Affiliates to Provide Services or Execute Transactions .............................37 Transactions in Securities, Futures and Similar Instruments ........................................37 Purchases of Unregistered Securities through a PNC Broker-Dealer ...........................38 Purchases of Securities for which a PNC Broker-Dealer is an Underwriter ..................38 Borrowing or Lending Funds or Securities and Cash Management ..............................39 Pricing and Valuation of Securities and Other Investments ..........................................39 Banking, Custodial and Related Services .....................................................................41 Considerations for ERISA Clients .................................................................................41 POTENTIAL CONFLICTS RELATING TO PRODUCTS AND SERVICES OF PNC AFFILIATES 42

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Item 3 Table of Contents

Investment Products or Services of PNC Affiliates May Compete with BlackRock Clients ...........................................................................................................................42 Investments in Service Clients or Portfolio Companies of the BlackRock Group or the PNC Affiliates................................................................................................................43 POTENTIAL CONFLICTS RELATING TO BLACKROCK CLIENTS' USE OF INVESTMENT CONSULTANTS AND BLACKROCK'S RELATIONSHIP WITH PENSION CONSULTANTS.......43 BLACKROCK MAY IN-SOURCE OR OUTSOURCE TO THIRD-PARTIES .................................43 POTENTIAL RESTRICTIONS ON INVESTMENT ADVISER ACTIVITY ......................................43 Item 12 Brokerage Practices....................................................................................................45 SELECTION OF BROKERS, DEALERS AND OTHER TRADING VENUES AND METHODS ....45 Soft Dollars ...................................................................................................................46 Access Fees Paid to, and Discounts Provided by, ECNs, Swap Clearing Firms and Other Trading Systems .................................................................................................47 COMPETING OR COMPLEMENTARY INVESTMENTS AND TRADE AGGREGATION.............47 DIRECTED BROKERAGE...........................................................................................................49 NON-DISCRETIONARY ACCOUNTS .........................................................................................50 CHANGES TO BLACKROCK'S BROKERAGE ARRANGEMENTS.............................................51 Item 13 Review of Accounts ....................................................................................................52 NATURE AND FREQUENCY OF CLIENT ACCOUNT REVIEW .................................................52 FREQUENCY AND CONTENT OF CLIENT ACCOUNT REPORTS............................................52 Item 14 Client Referrals and Other Compensation ................................................................53 PAYMENTS TO BLACKROCK BY A NON-CLIENT IN CONNECTION WITH ADVICE PROVIDED TO A CLIENT ..............................................................................................................................53 SOLICITATION, INTRODUCTION OR PLACEMENT ARRANGEMENTS ...................................53 SOLICITATIONS BY MLPF&S OR ITS EMPLOYEES .................................................................53 Item 15 Custody ........................................................................................................................58 Item 16 Investment Discretion .................................................................................................59 Item 17 Voting Client Securities ..............................................................................................60 Item 18 Financial Information ..................................................................................................63 GLOSSARY ................................................................................................................................ 64

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