Fixed Income

IDBB

iShares $ Development Bank Bonds UCITS ETF

Overview

Important Information: Capital at Risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

Important Information: Important Information: The value of your investment and the income from it will vary and your initial investment amount cannot be guaranteed. ETFs trade on exchanges like stocks and are bought and sold at market prices which may be different to the net asset values of the ETFs. Two main risks related to fixed income investing are interest rate risk and credit risk. Typically, when interest rates rise, there is a corresponding decline in the market value of bonds. Credit risk refers to the possibility that the issuer of the bond will not be able to repay the principal and make interest payments. The fund invests in fixed interest securities issued by companies. There is a risk of default where the issuing company may not pay income or repay capital to the Fund when due. The currency hedging is designed to reduce, but cannot eliminate the impact of currency movements between the Base Currency and the currencies in which some or all of the underlying investments are transacted. Depending on the exchange rates, this may have a positive or negative impact on the performance of the Fund.
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Performance

Performance

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This chart shows the fund's performance as the percentage loss or gain per year over the last 2 years. It can help you to assess how the fund has been managed in the past and compare it to its benchmark.

  2018 2019 2020 2021 2022
Total Return (%) -2.6 -10.1
Benchmark (%) -1.4 -7.5
  From
31.Dec.2017
To
31.Dec.2018
From
31.Dec.2018
To
31.Dec.2019
From
31.Dec.2019
To
31.Dec.2020
From
31.Dec.2020
To
31.Dec.2021
From
31.Dec.2021
To
31.Dec.2022
Total Return (%)

as of 31-Dec-2022

- - - -2.64 -10.14
Benchmark (%)

as of 31-Dec-2022

- - - -1.41 -7.48
  1y 3y 5y 10y Incept.
-7.85 - - - -4.14
Benchmark (%) -4.91 - - - -
  YTD 1m 3m 6m 1y 3y 5y 10y Incept.
1.28 1.28 1.74 -3.65 -7.85 - - - -11.52
Benchmark (%) 1.62 1.62 3.02 -1.63 -4.91 - - - -

The figures shown relate to past performance. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy.

Share Class and Benchmark performance displayed in CHF, hedged Share Class Benchmark performance is displayed in USD.

Performance is shown on a Net Asset Value (NAV) basis, with gross income reinvested where applicable. Performance data is based on the net asset value (NAV) of the ETF which may not be the same as the market price of the ETF. Individual shareholders may realize returns that are different to the NAV performance.

The return of your investment may increase or decrease as a result of currency fluctuations if your investment is made in a currency other than that used in the past performance calculation. Source: Blackrock

Key Facts

Key Facts

Net Assets as of 06-Feb-2023 CHF 43,790,918
Net Assets of Fund as of 06-Feb-2023 USD 561,917,277.78
Share Class launch date 09-Mar-2020
Fund Launch Date 06-Dec-2019
Share Class Currency CHF
Base Currency USD
Asset Class Fixed Income
Benchmark Index FTSE World Broad Investment-Grade USD Multilateral Development Bank Bond Capped Index
SFDR Classification Article 8
Shares Outstanding as of 06-Feb-2023 9,961,622
Total Expense Ratio 0.18%
Use of Income Accumulating
Securities Lending Return as of 31-Dec-2022 0.01 %
Domicile Ireland
Product Structure Physical
Rebalance Frequency Monthly
Methodology Sampled
UCITS Yes
Issuing Company iShares III plc
Fund Manager BlackRock Asset Management Ireland Limited
Administrator State Street Fund Services (Ireland) Limited
Custodian State Street Custodial Services (Ireland) Limited
Fiscal Year End 30-Jun-2021
Bloomberg Ticker IDBB SE
ISIN IE00BKT1CR43
Valor 52661480

Portfolio Characteristics

Portfolio Characteristics

Number of Holdings as of 06-Feb-2023 88
Benchmark Level as of 07-Feb-2023 USD 124.87
Benchmark Ticker CFIIUMDB
Standard Deviation (3y) as of - -
3y Beta as of - -
Weighted Avg YTM as of 06-Feb-2023 4.31%
Weighted Avg Coupon as of 06-Feb-2023 1.66%
Weighted Avg Maturity as of 06-Feb-2023 3.76 yrs
Effective Duration as of 06-Feb-2023 3.52

Sustainability Characteristics

Sustainability Characteristics

Sustainability Characteristics provide investors with specific non-traditional metrics. Alongside other metrics and information, these enable investors to evaluate funds on certain environmental, social and governance characteristics. Sustainability Characteristics do not provide an indication of current or future performance nor do they represent the potential risk and reward profile of a fund. They are provided for transparency and for information purposes only. Sustainability Characteristics should not be considered solely or in isolation, but instead are one type of information that investors may wish to consider when assessing a fund.


The metrics are not indicative of how or whether ESG factors will be integrated into a fund. Unless otherwise stated in fund documentation and included within a fund’s investment objective, the metrics do not change a fund’s investment objective or constrain the fund’s investable universe, and there is no indication that an ESG or Impact focused investment strategy or exclusionary screens will be adopted by a fund. For more information regarding a fund's investment strategy, please see the fund's prospectus.


Review the MSCI methodologies behind Sustainability Characteristics using the links below.

MSCI ESG Fund Rating (AAA-CCC) as of 21-Nov-2022 AAA
MSCI ESG % Coverage as of 21-Nov-2022 95.12
MSCI ESG Quality Score (0-10) as of 21-Nov-2022 10.00
MSCI ESG Quality Score - Peer Percentile as of 21-Nov-2022 100.00
Fund Lipper Global Classification as of 21-Nov-2022 Bond USD Government
Funds in Peer Group as of 21-Nov-2022 141
MSCI Weighted Average Carbon Intensity (Tons CO2E/$M SALES) as of 21-Nov-2022 4.48
MSCI Weighted Average Carbon Intensity % Coverage as of 21-Nov-2022 94.77
All data is from MSCI ESG Fund Ratings as of 21-Nov-2022, based on holdings as of 31-Oct-2022. As such, the fund’s sustainable characteristics may differ from MSCI ESG Fund Ratings from time to time.

To be included in MSCI ESG Fund Ratings, 65% of the fund’s gross weight must come from securities with ESG coverage by MSCI ESG Research (certain cash positions and other asset types deemed not relevant for ESG analysis by MSCI are removed prior to calculating a fund’s gross weight; the absolute values of short positions are included but treated as uncovered), the fund’s holdings date must be less than one year old, and the fund must have at least ten securities. For newly launched funds, Sustainability Characteristics are typically available 6 months after launch.

Business Involvement

Business Involvement

Business Involvement metrics can help investors gain a more comprehensive view of specific activities in which a fund may be exposed through its investments.


Business Involvement metrics are not indicative of a fund’s investment objective, and, unless otherwise stated in fund documentation and included within a fund’s investment objective, do not change a fund’s investment objective or constrain the fund’s investable universe, and there is no indication that an ESG or Impact focused investment strategy or exclusionary screens will be adopted by a fund. For more information regarding a fund's investment strategy, please see the fund's prospectus.


Review the MSCI methodology behind the Business Involvement metrics, using links below.

MSCI - Controversial Weapons as of 06-Feb-2023 0.00%
MSCI - UN Global Compact Violators as of 06-Feb-2023 0.00%
MSCI - Nuclear Weapons as of 06-Feb-2023 0.00%
MSCI - Thermal Coal as of 06-Feb-2023 0.00%
MSCI - Civilian Firearms as of 06-Feb-2023 0.00%
MSCI - Oil Sands as of 06-Feb-2023 0.00%
MSCI - Tobacco as of 06-Feb-2023 0.00%

Business Involvement Coverage as of 06-Feb-2023 95.43%
Percentage of Fund not covered as of 06-Feb-2023 4.57%
BlackRock business involvement exposures as shown above for Thermal Coal and Oil Sands are calculated and reported for companies that generate more than 5% of revenue from thermal coal or oil sands as defined by MSCI ESG Research. For the exposure to companies that generate any revenue from thermal coal or oil sands (at a 0% revenue threshold), as defined by MSCI ESG Research, it is as follows: Thermal Coal 0.00% and for Oil Sands 0.00%.

Business Involvement metrics are calculated by BlackRock using data from MSCI ESG Research which provides a profile of each company’s specific business involvement. BlackRock leverages this data to provide a summed up view across holdings and translates it to a fund's market value exposure to the listed Business Involvement areas above.


Business Involvement metrics are designed only to identify companies where MSCI has conducted research and identified as having involvement in the covered activity. As a result, it is possible there is additional involvement in these covered activities where MSCI does not have coverage. This information should not be used to produce comprehensive lists of companies without involvement. Business Involvement metrics are only displayed if at least 1% of the fund’s gross weight includes securities covered by MSCI ESG Research.

Sustainability-related Disclosure

Sustainability-related Disclosure

This section provides sustainability-related information about the Fund, pursuant to Article 10 SFDR.

A. Summary

This Fund promotes environmental or social characteristics, but does not have as its objective sustainable investment. The Fund does not commit to investing in sustainable investments. The Fund is passively managed and seeks to promote the following environmental and social characteristics by tracking the performance of the FTSE World Broad Investment-Grade USD Multilateral Development Bank Bond Capped Index, its Benchmark Index: (1) exposure to bonds where the issuer aims to foster economic and social progress by making finance available to sustainable projects; and (2) exclusion of issuers deemed to have violated United Nations Global Compact principles.

The investment policy of the Fund is to invest in a portfolio of securities that as far as possible and practicable consists of the component securities of the Benchmark Index and thereby comply with the ESG characteristics of its Benchmark Index (as further described in Section D. Investment strategy below). By investing in the constituents of its Benchmark Index, the Fund’s investment strategy enables it to comply with the ESG requirements of its Benchmark Index as determined by the index provider. ​The Fund takes into consideration principal adverse impacts on sustainability factors by tracking the Benchmark Index which incorporates certain ESG criteria in the selection of index constituents.

The Fund seeks to invest in a portfolio of securities that as far as possible and practicable consists of the component securities of the Benchmark Index. It is expected that at least 80% of the Fund's assets will be invested in securities within the Benchmark Index. The Fund does not currently commit to investing more than 0% of its assets in sustainable investments with an environmental objective aligned with the EU Taxonomy.

The Fund seeks to track the performance of the Benchmark Index which incorporates certain ESG criteria in the selection of constituents, according to its methodology. BlackRock monitors the Fund’s adherence to the environmental and social characteristics which the Fund seeks to promote. The objective of the Fund is to track the performance of the Benchmark Index. The environmental and/or social characteristics of the Fund are embedded into the Benchmark Index methodology and the Fund is monitored in a manner that seeks to identify exceptions to the Fund’s sustainable commitments being met as at each rebalance.

BlackRock Portfolio Managers have access to research, data, tools, and analytics to integrate ESG insights into their investment process. ESG datasets are sourced from external third-party data providers and index providers, including but not limited to MSCI, Sustainalytics, Refinitiv, S&P and Clarity AI. BlackRock’s internal processes are focused on delivering high-quality standardised and consistent data to be used by investment professionals and for transparency and reporting purposes. Data, including ESG data, received through our existing interfaces, is processed through a series of quality control and completeness checks which seeks to ensure that data is high-quality data before being made available for use downstream within BlackRock systems and applications, such as Aladdin.

BlackRock applies a comprehensive due diligence process to evaluate provider offerings with highly targeted methodology reviews and coverage assessments based on the sustainable investment strategy (and the environmental and social characteristics or sustainable investment objective) of the product. Our process entails both qualitative and quantitative analysis to assess the suitability of data products in line with regulatory standards as applicable.

Sustainable investing and understanding of sustainability is evolving along with the data environment. Industry participants, including index providers face challenges in identifying a single metric or set of standardized metrics to provide a complete view on a company or an investment. ESG data sets are constantly changing and improving as disclosure standards, regulatory frameworks and industry practice evolve. There may be some circumstances where data is unavailable, incomplete, or inaccurate. Despite reasonable efforts, information may not always be available in which case an assessment will be made by the index provider based on their knowledge of the investment or industry. In certain cases, data may reflect actions that issuers may have taken only after the fact, and do not reflect all potential instances of significant harm.

The Investment Manager carries out due diligence on the index providers and engages with them on an ongoing basis with regard to index methodologies including their assessment of good governance criteria set out by the SFDR which include sound management structures, employee relations, remuneration of staff and tax compliance at the level of investee companies.

The Investment Manager does not perform direct engagement with the companies / issuers within the Benchmark Index as part of the investment strategy of the Fund. The Investment Manager will engage directly with the index and data providers to ensure better analytics and stability in ESG metrics. Engagement with companies in which we invest our clients’ assets occurs at multiple levels within BlackRock. Where investment teams choose to leverage engagement, this can take a variety of forms but, in essence, the portfolio management team would seek to have regular and continuing dialogue with executives or board directors of engaged investee companies to advance sound governance and sustainable business practices targeted at the identified ESG characteristics and principal adverse indicators, as well as to understand the effectiveness of the company’s management and oversight of activities designed to address the identified ESG issues. Engagement also allows the portfolio management team to provide feedback on company practices and disclosures.

The Benchmark Index is designated as a reference benchmark to determine whether the Fund is aligned with the environmental and/or social characteristics that it promotes.

B. No sustainable investment objective

This Fund promotes environmental or social characteristics, but does not have as its objective sustainable investment.

The Fund does not commit to investing in sustainable investments.

C. Environmental or social characteristics of the financial product

The Fund is passively managed and seeks to promote the following environmental and social characteristics by tracking the performance of the FTSE World Broad Investment-Grade USD Multilateral Development Bank Bond Capped Index, its Benchmark Index:
1. exposure to bonds where the issuer aims to foster economic and social progress by making finance available to sustainable projects; and
2. exclusion of issuers deemed to have violated United Nations Global Compact principles.

These environmental and social characteristics are incorporated through the selection of constituents in the Fund’s Benchmark Index (as described below).

The Benchmark Index measures the performance of a sub-set of global US Dollar denominated, fixed-rate, investment grade multilateral development bank debt in the FTSE World Broad Investment-Grade Bond Index (the "Parent Index"). Multilateral development banks are supranational institutions set up by sovereign states. The multilateral development banks' aim is to foster economic and social progress mostly in developing countries by making finance available for sustainable projects.

The Benchmark Index also excludes issuers from the Parent Index which are classified as violating or are at risk of violating commonly accepted international norms and standards, enshrined in the United Nations Global Compact (UNGC) Principles and its underlying conventions.

For more information on where details of the methodology of the Benchmark Index can be found see 'Section L - Designated reference benchmark.'

D. Investment strategy

The investment policy of the Fund is to invest in a portfolio of fixed income securities that as far as possible and practicable consists of the component securities of the Benchmark Index and thereby comply with the ESG characteristics of its Benchmark Index. The index methodology of its Benchmark Index is described above see 'Section C - Environmental or social characteristics of the financial product.'

By investing in the constituents of its Benchmark Index, the Fund’s investment strategy enables it to comply with the ESG requirements of its Benchmark Index as determined by the index provider. In the event that any investments cease to comply, the Fund may continue to hold such investments only until such time as the relevant securities cease to form part of the Benchmark Index and it is possible and practicable (in the Investment Manager's view) to liquidate the position.

The Fund may use optimisation techniques in order to achieve a similar return to the Benchmark Index which means that it is permitted to invest in securities that are not underlying constituents of the Benchmark Index where such securities provide similar performance (with matching risk profile) to certain securities that make up the Benchmark Index. If the Fund does so, its investment strategy is to invest only in issuers in the Benchmark Index or in issuers that meet the ESG requirements of the Benchmark Index at the time of purchase. If such securities cease to comply with the ESG requirements of the Benchmark Index, the Fund may hold such securities only until the next portfolio rebalance and when it is possible and practicable (in the Investment Manager's view) to liquidate the position.

The strategy is implemented at each portfolio rebalance of the Fund, which follows the index rebalance of its Benchmark Index.

The binding elements of the investment strategy are that the Fund will invest in a portfolio of fixed income securities that as far as possible and practicable consists of the component securities of the Benchmark Index and thereby comply with the ESG characteristics of its Benchmark Index.

As the Fund is able to use optimisation techniques and may invest in securities that are not underlying constituents of the Benchmark Index, where it does so, its investment strategy is to invest only in issuers in the Benchmark Index or in issuers that meet the ESG requirements of the Benchmark Index at the time of purchase.

In the event that any investments cease to comply with the ESG requirements of the Benchmark Index, the Fund may continue to hold such investments only until such time as the relevant securities cease to form part of the Benchmark Index and/or it is possible and practicable (in the Investment Manager's view) to liquidate the position.

Consideration of principal adverse impacts (PAIs) on sustainability factors

The Fund takes into consideration principal adverse impacts on sustainability factors by tracking the Benchmark Index which incorporates certain ESG criteria in the selection of index constituents. The Investment Manager has determined that those principal adverse impacts (PAIs) listed below are considered as part of the selection criteria of the Fund’s Benchmark Index at each index rebalance:
• Share of investments in investee companies that have been involved in violations of the UNGC principles or OECD Guidelines for Multinational Enterprises.

The Fund's annual report will include information on the principal adverse impacts on sustainability factors set out below.

Good governance policy

Good governance checks are incorporated within the methodology of the Benchmark Index. The index provider excludes issuers from the Benchmark Index at each index rebalance that are classified as violating United Nations Global Compact principles see 'Section C - Environmental or social characteristics of the financial product.'

E. Proportion of Investments

The Fund seeks to invest in a portfolio of securities that as far as possible and practicable consists of the component securities of the Benchmark Index.

It is expected that at least 80% of the Fund's assets will be invested in either securities within the Benchmark Index or in securities that meet the ESG selection criteria of the Benchmark Index. As such, at each index rebalance (or as soon as reasonably possible and practicable thereafter), the portfolio of the Fund will be rebalanced in line with its Benchmark Index so that at least 80% of the Fund's assets will be aligned with the ESG characteristics of the Benchmark Index (as determined at that rebalance). In the event that any investments cease to comply with the ESG requirements of the Benchmark Index, the Fund may continue to hold such investments until such time as the relevant securities cease to form part of the Benchmark Index (or otherwise cease to meet the ESG selection criteria of the Benchmark Index) and it is possible and practicable (in the Investment Manager's view) to liquidate the position.

The Fund may invest up to 20% of its assets in other investments.

The Fund may use derivatives for investment purposes and for the purposes of efficient portfolio management in connection with the environmental or social characteristics promoted by the Fund. Where the Fund uses derivatives for promoting environmental or social characteristics, any ESG rating or analyses referenced above will apply to the underlying investment.

This Fund does not currently commit to investing more than 0% of its assets in investments in environmentally sustainable economic activities within the meaning of the Taxonomy Regulation.

This Fund does not currently commit to investing more than 0% of its assets in investments in transitional and enabling activities within the meaning of the Taxonomy Regulation.

The Fund does not commit to investing in sustainable investments with an environmental objective.

This Fund does not currently commit to investing more than 0% of its assets in socially sustainable investments.

Other holdings may include cash, money market funds and derivatives. Such investments may only be used for the purpose of efficient portfolio management, except for derivatives used for currency hedging for any currency hedged share class.

Any ESG rating or analyses applied by the index provider will apply only to the derivatives relating to individual issuers used by the Fund. Derivatives based on financial indices, interest rates, or foreign exchange instruments will not be considered against minimum environmental or social safeguards.

F. Monitoring of enviromental or social characteristics

Ongoing product integrity monitoring

BlackRock monitors the Fund’s adherence to the environmental and social characteristics which the Fund seeks to promote. The objective of the Fund is to track the performance of the Benchmark Index. The environmental and/or social characteristics of the Fund are embedded into the Benchmark Index methodology and the Fund is monitored in a manner that seeks to identify exceptions to the Fund’s sustainable commitments being met as at each rebalance.

BlackRock monitors Fund and index-level data to track the Fund’s adherence to these characteristics as at each rebalance.

BlackRock also monitors the tracking error of the Fund and reports this to investors as part of the annual and semi-annual report and accounts. Information on the anticipated tracking error is also published in the Fund’s prospectus.

G. Methodologies

The Fund seeks to track the performance of the Benchmark Index which incorporates certain ESG criteria in the selection of constituents, according to its methodology (outlined above in Section C and detailed in section L).

Methodologies

In addition, the following methodologies are used to measure how the social or environmental characteristics promoted by the Fund are met:

The Benchmark Index uses Sustainalytics Global Standard Screening (GSS). For further information, please see the index methodology

H. Data sources and processing

Data Sources

BlackRock Portfolio Managers have access to research, data, tools, and analytics to integrate ESG insights into their investment process. Aladdin is the operating system that connects the data, people, and technology necessary to manage portfolios in real time, as well as the engine behind BlackRock’s ESG analytics and reporting capabilities. BlackRock’s Portfolio Managers use Aladdin to make investment decisions, monitor portfolios and to access index information that informs the investment process to attain ESG characteristics of the Fund.

ESG datasets are sourced from external third-party data providers and index providers, including but not limited to MSCI, Sustainalytics, Refinitiv, S&P and Clarity AI. These datasets may include headline ESG scores, carbon emissions data, business involvement metrics or controversies and have been incorporated into Aladdin tools that are available to Portfolio Managers and employed in BlackRock investment strategies. Such tools support the full investment process, from research, to portfolio construction and modelling, to reporting.

Measures taken to ensure Data Quality

BlackRock applies a comprehensive due diligence process to evaluate provider offerings with highly targeted methodology reviews and coverage assessments based on the sustainable investment strategy (and the environmental and social characteristics or sustainable investment objective) of the product. Our process entails both qualitative and quantitative analysis to assess the suitability of data products in line with regulatory standards as applicable.

We assess ESG providers and data across five core areas outlined below:
1. Data Collection: this includes but is not limited to assessing the data providers underlying data sources, technology used to capture data, process to identify misinformation and any use of machine learning or human data collection approaches. We will also consider planned improvements.
2.Data Coverage: our assessment includes but is not limited to the extent to which a data package provides coverage across our investible universe of issuers and asset classes. This will include consideration of the treatment of parent companies and their subsidiaries as well as use of estimated data or reported data.
3. Methodology: our assessment includes but is not limited consideration of the third-party providers methodologies employed, including considering the collection and calculation approaches, alignment to industry or regulatory standards or frameworks, materiality thresholds and their approach to data gaps.
4. Data Verification: our assessment will include but is not limited to the third-party providers approach to verification of data collected and quality assurance processes including their engagement with issuers.
5. Operations: we will assess a variety of aspects of a data vendors’ operations, including but not limited to their policies and procedures (including consideration of any conflicts of interest) the size and experience of their data research teams, their training programs, and their use of third-party outsourcers.

Additionally, BlackRock, actively participates in any relevant provider consultations regarding proposed changes to methodologies as it pertains to third party data sets or index methodologies and submits comprehensive feedback and recommendations to data provider technical teams. BlackRock often has ongoing engagement with ESG data providers including index providers to keep abreast of industry developments.

How data is processed

At BlackRock, our internal processes are focused on delivering high-quality standardised and consistent data to be used by investment professionals and for transparency and reporting purposes. Data, including ESG data, received through our existing interfaces, and then processed through a series of quality control and completeness checks which seeks to ensure that data is high-quality data before being made available for use downstream within BlackRock systems and applications, such as Aladdin. BlackRock’s integrated technology enables us to compile data about issuers and investments across a variety of environmental, social and governance metrics and a variety of data providers and make those available to investment teams and other support and control functions such as risk management.

Use of Estimated Data

BlackRock strives to capture as much reported data from companies via 3rd party data providers as practicable, however, industry standards around disclosure frameworks are still evolving, particularly with respect to forward looking indicators. As a result, in certain cases we rely on estimated or proxy measures from data providers to cover our broad investible universe of issuers. Due to current challenges in the data landscape, while BlackRock relies on material amount of estimated data across our investible universe, the levels of which may vary from data set to data set, we seek to ensure that use of estimates is in line with regulatory guidance and that we have necessary documentation and transparency from data providers on their methodologies. BlackRock recognizes the importance in improving its data quality and data coverage and continues to evolve the data sets available to its investment professionals and other teams. Where required by local country-level regulations, funds may state explicit data coverage levels. BlackRock seeks to understand the use of estimated data in index methodologies and ensure that their approaches are robust and in line with applicable regulatory requirements and index methodologies.

I. Limitations to methodologies and data

Limitations to Methodology

Sustainable investing is an evolving space, both in terms of industry understanding but also the regulatory frameworks on both a regional and global basis. BlackRock continues to monitor developments in the EU's ongoing implementation of its framework for sustainable investing and its investment methodologies seeking to ensure alignment as the regulatory environment changes. As a result, BlackRock may update these disclosures, and the methodologies and sources of data used, at any time in the future as market practice evolves or further regulatory guidance becomes available.

Screening of a Benchmark Index against its ESG criteria is generally carried out by an index provider only at index rebalances. Companies which have previously met the screening criteria of a Benchmark Index and have therefore been included in the Benchmark Index and the Fund, may unexpectedly or suddenly be impacted by an event of serious controversy which negatively impacts their price and, hence, the performance of the Fund. Where these companies are existing constituents of the Benchmark Index, they will remain in the Benchmark Index and therefore continue to be held by the Fund until the next scheduled rebalancing (or periodic review) when the relevant company ceases to form part of the Benchmark Index and it is possible and practicable (in the Investment Manager’s view) to liquidate the position. A Fund tracking such Benchmark Index may therefore cease to meet the ESG criteria between index rebalances (or index periodic reviews) until the Benchmark Index is rebalanced back in line with its index criteria, at which point the Fund will also be rebalanced in line with its Benchmark Index. Similarly index methodologies that commit to investing in a minimum percentage of Sustainable Investments may also fall below that level in between rebalances but will be brought back into line at the point of rebalance (or as soon as practicable thereafter).

Limitations in relation to the data sources are noted below.

Limitations to Data

ESG data sets are constantly changing and improving as disclosure standards, regulatory frameworks and industry practice evolve. BlackRock continues to work with a broad range of market participants to improve data quality.

Whilst each ESG metric may come with its own individual limitations, data limitations may broadly be considered to include, but not be limited to:
• Lack of availability of certain ESG metrics due to differing reporting and disclosure standards impacting issuers, geographies, or sectors.
• Nascent statutory corporate reporting standards regarding sustainability leading to differences in the extent to which companies themselves can report against regulatory criteria and therefore some metric coverage levels may be low.
• Inconsistent use and levels of reported vs estimated ESG data across different data providers, taken at varied time periods which makes comparability a challenge.
• Estimated data by its nature may vary from realized figures due to the assumptions or hypothesis employed by data providers.
• Differing views or assessments of issuers due to differing provider methodologies or use of subjective criteria. • Most corporate ESG reporting, and disclosure takes place on an annual basis and takes significant time to produce meaning that this data is produced on a lag relative to financial data. There may also be inconsistent data refresh frequencies across different data providers incorporating such data into their data sets.
• Coverage and applicability of data across asset classes and indicators may vary.
• Forward looking data, such as climate related targets may vary significantly from historic and current point in time metrics.

For more information about how metrics that are presented with sustainability indicators are calculated, please see the Fund's annual report.

Sustainable Investments and Environmental and Social criteria

Sustainable investing and understanding of sustainability is evolving along with the data environment. Industry participants, including index provider face challenges in identifying a single metric or set of standardized metrics to provide a complete view on a company or an investment. BlackRock has therefore established a framework to identify sustainable investments, taking into account the regulatory requirements and index provider methodologies.

BlackRock leverages third-party index provider methodologies and data in assessing whether investments cause significant harm and have good governance practices. There may be some circumstances where data is unavailable, incomplete, or inaccurate. Despite reasonable efforts, information may not always be available in which case an assessment will be made by the index provider based on their knowledge of the investment or industry. In certain cases, data may reflect actions that issuers may have taken only after the fact, and do not reflect all potential instances of significant harm.

BlackRock undertakes thorough due diligence on index provider sustainable investment methodologies to ensure that they align with BlackRock’s views on Sustainable Investments.

J. Due Diligence

The Investment Manager carries out due diligence on the index providers and engages with them on an ongoing basis with regard to index methodologies including their assessment of good governance criteria set out by the SFDR which include sound management structures, employee relations, remuneration of staff and tax compliance at the level of investee companies.

K. Engagement Policies

The Fund

The Fund does not use engagement as a means of meeting its binding commitments to environmental or social characteristics or sustainable investment objectives. The Investment Manager does not perform direct engagement with the companies / issuers within the index but does engage directly with the index and data providers to ensure better analytics and stability in ESG metrics.

General

Engagement with companies in which we invest our clients’ assets occurs at multiple levels within BlackRock.

Where engagement is specifically identified by a particular portfolio management team as one of the means by which they seek to demonstrate a commitment to environment, social and governance issues within the context of SFDR, the methods by which the effectiveness of such engagement policy and the ways in which such an engagement policy may be adapted in the event that they do not achieve the desired impact (usually expressed as a reduction in specified principal adverse indicators) would be described in the prospectus and website disclosures particular to that fund.

Where investment teams chooses to leverage engagement, this can take a variety of forms but, in essence, the portfolio management team would seek to have regular and continuing dialogue with executives or board directors of engaged investee companies to advance sound governance and sustainable business practices targeted at the identified ESG characteristics and principal adverse indicators, as well as to understand the effectiveness of the company’s management and oversight of activities designed to address the identified ESG issues. Engagement also allows the portfolio management team to provide feedback on company practices and disclosures.

Where a relevant portfolio management team has concerns about a company’s approach to the identified ESG characteristics and/or principal adverse indicators, they may choose to explain their expectations to the company’s board or management and may signal through voting at general meetings that they have outstanding concerns, generally by voting against the re-election of directors they view as having responsibility for improvements in the identified ESG characteristics or principal adverse indicators.

Separate from the activities of any particular portfolio management team, at the highest level, as part of its fiduciary approach, BlackRock has determined that it is in the best long-term interest of its clients to promote sound corporate governance as an informed, engaged shareholder. At BlackRock, this is the responsibility of BlackRock Investment Stewardship. Principally through the work of BIS team, BlackRock meets the requirements in the Shareholder Rights Directive II (‘SRD II”) relating to engagement with public companies and other parties in the investment ecosystem. A copy of BlackRock’s SRD II engagement policy can be found at https://www.blackrock.com/corporate/literature/publication/blk-shareholder-rights-directiveii-engagement-policy-2022.pdf.

BlackRock’s approach to investment stewardship is outlined in the BIS Global Principles and market-level voting guidelines. The BIS Global Principles set out our stewardship philosophy and our views on corporate governance and sustainable business practices that support long-term value creation by companies. We recognize that accepted standards and norms of corporate governance differ between markets; however, we believe there are certain fundamental elements of governance practice that are intrinsic globally to a company’s ability to create long-term value. Our market-specific voting guidelines provide detail on how BIS implements the Global Principles – taking into consideration local market standards and norms – and inform our voting decisions in relation to specific ballot items for shareholder meetings. BlackRock’s overall approach to investment stewardship and engagement can be found at: https://www.blackrock.com/uk/professionals/solutions/shareholder-rights-directive and https://www.blackrock.com/corporate/about-us/investment-stewardship

In undertaking its engagement, BIS may focus on particular ESG themes, which are outlined in BlackRock’s voting priorities https://www.blackrock.com/corporate/literature/publication/blk-stewardship-priorities-final.pdf

I. Designated reference benchmark

This Fund seeks to achieve the environmental and social characteristics it promotes by tracking the performance of the FTSE World Broad Investment-Grade USD Multilateral Development Bank Bond Capped Index, its Benchmark Index, which incorporates the index provider’s ESG selection criteria.

At each index rebalance, the index provider applies the ESG selection criteria to the Parent Index to exclude issuers that do not meet such ESG selection criteria.

At each index rebalance (or as soon as reasonably possible and practicable thereafter), the portfolio of the Fund is also rebalanced in line with its Benchmark Index.

As a result of the application of the ESG selection criteria of the Benchmark Index, the portfolio of the Fund is expected to be reduced compared to the FTSE World Broad Investment-Grade Bond Index, a broad market index comprised of fixed income securities.

The methodology of the Fund’s Benchmark Index can be found by copying and pasting the following link into your web browser: https://research.ftserussell.com/products/downloads/FTSE_World_Broad_Investment-Grade_USD_Multilateral_Development_Bank_Bond_Capped_Index_CFIIUMDB_Ground_Rules.pdf

Further details of the Fund’s Benchmark Index (including its constituents) are also available on the index provider’s website at: http://www.yieldbook.com/m/indices/search.shtml.

 

Ratings

Registered Locations

Registered Locations

  • Ireland

  • Liechtenstein

  • Switzerland

Holdings

Holdings

as of 06-Feb-2023
Issuer Weight (%)
ASIAN DEVELOPMENT BANK 26.32
INTER-AMERICAN DEVELOPMENT BANK 25.17
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT 24.33
INTERNATIONAL FINANCE CORP 7.25
Issuer Weight (%)
AFRICAN DEVELOPMENT BANK 6.56
EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT 5.57
INTERNATIONAL DEVELOPMENT ASSOCIATION 4.54
Issuer Ticker Name Sector Asset Class Market Value Weight (%) Notional Value Nominal Par Value ISIN Price Location Exchange Duration Maturity Coupon (%) Market Currency Effective Date
Detailed Holdings and Analytics contains detailed portfolio holdings information and select analytics.

Exposure Breakdowns

Exposure Breakdowns

as of 06-Feb-2023

% of Market Value

Type Fund
as of 06-Feb-2023

% of Market Value

Type Fund
Geographic exposure relates principally to the domicile of the issuers of the securities held in the product, added together and then expressed as a percentage of the product’s total holdings. However, in some instances it can reflect the location where the issuer of the securities carries out much of their business.
as of 06-Feb-2023

% of Market Value

Type Fund
as of 06-Feb-2023

% of Market Value

Type Fund
as of 06-Feb-2023

% of Market Value

Type Fund
Credit quality ratings on underlying securities of the fund are received from S&P, Moody’s and Fitch and converted to the equivalent S&P major rating category. This breakdown is provided by BlackRock and takes the median rating of the three agencies when all three agencies rate a security the lower of the two ratings if only two agencies rate a security and one rating if that is all that is provided. Unrated securities do not necessarily indicate low quality. Below investment-grade is represented by a rating of BB and below. Ratings and portfolio credit quality may change over time.

Allocations are subject to change.

Securities Lending

Securities Lending

Securities lending is an established and well regulated activity in the investment management industry. It involves the transfer of securities (such as shares or bonds) from a Lender (in this case, the iShares fund) to a third-party (the Borrower). The Borrower will give the Lender collateral (the Borrower’s pledge) in the form of shares, bonds or cash, and will also pay the Lender a fee. This fee provides additional income for the fund and thus can help to reduce the total cost of ownership of an ETF.

 

At BlackRock, securities lending is a core investment management function with dedicated trading, research and technology capabilities. The lending programme is designed to deliver superior absolute returns to clients, whilst maintaining a low risk profile. Funds participating in securities lending retain 62.5% of the income, while BlackRock receives 37.5% of the income and covers all the operational costs resulting from securities lending transactions.

  From
31.Dec.2017
To
31.Dec.2018
From
31.Dec.2018
To
31.Dec.2019
From
31.Dec.2019
To
31.Dec.2020
From
31.Dec.2020
To
31.Dec.2021
From
31.Dec.2021
To
31.Dec.2022
Securities Lending Return (%) 0.01 0.01
Average on-loan (% of AUM) 8.32 10.14
Maximum on-loan (% of AUM) 16.45 15.13
Collateralisation (% of Loan) 105.80 104.17
The above table summarises the lending data available for the fund.

The information in the Lending Summary table will not be displayed for the funds that have participated in securities lending for less than 12 months. The figures shown relate to past performance. Past performance is not a reliable indication of current or future results.
BlackRock’s policy is to disclose performance information quarterly subject to a one-month delay. This means that returns from 01/01/2019 to 31/12/2019 can be publicly disclosed from 01/02/2020.

Maximum on-loan figure may increase or decrease over time.

With securities lending there is a risk of loss should the borrower default before the securities are returned, and due to market movements, the value of collateral held has fallen and/or the value of the securities on loan has risen.
as of 06-Feb-2023
Ticker Name Asset Class Weight % ISIN SEDOL Exchange Location
Collateral Holdings shown on this page are provided on days where the fund participating in securities lending had an open loan.

The information in the Collateral Holdings table relates to securities obtained in the collateral basket under the securities lending programme for the fund in question. The information contained in this material is derived from proprietary and non-proprietary sources deemed by BlackRock to be reliable, is not necessarily all inclusive and is not guaranteed as to accuracy. Reliance upon information in this material is at the sole discretion of the reader. The primary risk in securities lending is that a borrower will default on their commitment to return lent securities while the value of the liquidated collateral does not exceed the cost of repurchasing the securities and the fund suffers a loss in respect of the short-fall.

The below table shows the Loan/Collateral Combinations and Collateral Levels for our European Lending funds.

Collateral Types
Loan Type Equities Government, Supranational and Agency Bonds Cash (Not for Reinvestment)
Equities 105%-112% 105%-106% 105%-108%
Government Bonds 110%-112% 102.5%-106% 102.5%-105%
Corporate Bonds 110%-112% 104%-106% 103.5%-105%

We also accept selected physically replicating Equity, Government Bond, Credit and Commodity ETFs as collateral.

Collateral parameters depend on the collateral and the loan combination, and the over collateralisation level may range from 102.5% to 112%. In this context, “Over Collateralisation” means that the aggregate market value of collateral taken will exceed the overall on-loan value. Collateral parameters are reviewed on an ongoing bases and are subject to change.
With securities lending there is a risk of loss should the borrower default before the securities are returned, and due to market movements, the value of collateral held has fallen and/or the value of the securities on loan has risen.

Listings

Listings

Exchange Ticker Currency Listing Date SEDOL Bloomberg Ticker RIC Bloomberg INAV Reuters INAV ISIN WKN Valor Common Code (EOC) ISIN of INAV
SIX Swiss Exchange IDBB CHF 11-Mar-2020 BKV0QH7 IDBB SE IDBB.S - - IE00BKT1CR43 A2P0Z0 52661480 - -

Literature

Literature