Results

BlackRock Funds V

12/03/2021 | Press release | Distributed by Public on 12/03/2021 09:41

Annual Report by Investment Company (Form N-CSR)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-23339
Name of Fund: BlackRock Funds V
BlackRock Sustainable High Yield Bond Fund
Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809
Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Funds V, 55 East 52nd Street, New York, NY 10055
Registrant's telephone number, including area code: (800) 441-7762
Date of fiscal year end: 09/30/2021
Date of reporting period: 09/30/2021
Item 1 - Report to Stockholders
(a)
The Report to Shareholders is attached herewith.
(b)
Not Applicable
September
30,
2021
Not
FDIC
Insured
-
May
Lose
Value
-
No
Bank
Guarantee
2021
Annual
Report
BlackRock
Funds
V
BlackRock
Sustainable
High
Yield
Bond
Fund
Dear
Shareholder,
The
12-month
reporting
period
as
of
September
30,
2021
was
a
remarkable
period
of
adaptation
and
recovery,
as
the
global
economy
dealt
with
the
implications
of
the
coronavirus
(or
"COVID-19")
pandemic.
The
United
States
began
the
reporting
period
as
the
initial
reopening-led
economic
rebound
was
beginning
to
slow.
Nonetheless,
the
economy
continued
to
grow
at
a
brisk
pace
for
the
reporting
period,
eventually
regaining
the
output
lost
from
the
pandemic.
Equity
prices
rose
with
the
broader
economy,
as
strong
fiscal
and
monetary
support,
as
well
as
the
development
of
vaccines,
made
investors
increasingly
optimistic
about
the
economic
outlook.
The
implementation
of
mass
vaccination
campaigns
and
passage
of
two
additional
fiscal
stimulus
packages
further
boosted
stocks,
and
many
equity
indices
neared
or
surpassed
all-time
highs
late
in
the
reporting
period.
In
the
United
States,
returns
of
small-capitalization
stocks,
which
benefited
the
most
from
the
resumption
of
in-person
activities,
outpaced
large-capitalization
stocks.
International
equities
also
gained,
as
both
developed
and
emerging
markets
continued
to
recover
from
the
effects
of
the
pandemic.
The
10-year
U.S.
Treasury
yield
(which
is
inversely
related
to
bond
prices)
had
fallen
sharply
prior
to
the
beginning
of
the
reporting
period,
which
meant
bonds
were
priced
for
extreme
risk
avoidance
and
economic
disruption.
Despite
expectations
of
doom
and
gloom,
the
economy
expanded
rapidly,
stoking
inflation
concerns
in
early
2021,
which
led
to
higher
yields
and
a
negative
overall
return
for
most
U.S.
Treasuries.
In
the
corporate
bond
market,
support
from
the
U.S.
Federal
Reserve
(the
"Fed")
assuaged
credit
concerns
and
led
to
solid
returns
for
high-yield
corporate
bonds,
although
investment-grade
corporates
declined
slightly.
The
Fed
remained
committed
to
accommodative
monetary
policy
by
maintaining
near-zero
interest
rates
and
by
reiterating
that
inflation
could
exceed
its
2%
target
for
a
sustained
period
without
triggering
a
rate
increase.
In
response
to
rising
inflation
late
in
the
period,
the
Fed
changed
its
market
guidance,
raising
the
possibility
of
higher
rates
in
2022
and
reducing
bond
purchasing
beginning
in
late
2021.
Looking
ahead,
we
believe
that
the
global
expansion
will
continue
to
broaden
as
Europe
and
other
developed
market
economies
gain
momentum,
although
the
delta
variant
of
the
coronavirus
remains
a
threat,
particularly
in
emerging
markets.
While
we
expect
inflation
to
remain
elevated
in
the
medium-term
as
the
expansion
continues,
we
believe
the
recent
uptick
owes
more
to
temporary
supply
disruptions
than
a
lasting
change
in
fundamentals.
The
change
in
Fed
policy
also
means
that
moderate
inflation
is
less
likely
to
be
followed
by
interest
rate
hikes
that
could
threaten
the
economic
expansion.
Overall,
we
favor
a
moderately
positive
stance
toward
risk,
with
an
overweight
in
equities.
Sectors
that
are
better
poised
to
manage
the
transition
to
a
lower-carbon
world,
such
as
technology
and
health
care,
are
particularly
attractive
in
the
long-term.
U.S.
small-capitalization
stocks
and
European
equities
are
likely
to
benefit
from
the
continuing
vaccine-led
restart,
while
Chinese
equities
stand
to
gain
from
a
more
accommodative
monetary
and
fiscal
environment
as
the
Chinese
economy
slows.
We
are
underweight
long-term
credit,
but
inflation-protected
U.S.
Treasuries,
Asian
fixed
income,
and
emerging
market
local-currency
bonds
offer
potential
opportunities.
We
believe
that
international
diversification
and
a
focus
on
sustainability
can
help
provide
portfolio
resilience,
and
the
disruption
created
by
the
coronavirus
appears
to
be
accelerating
the
shift
toward
sustainable
investments.
In
this
environment,
our
view
is
that
investors
need
to
think
globally,
extend
their
scope
across
a
broad
array
of
asset
classes,
and
be
nimble
as
market
conditions
change.
We
encourage
you
to
talk
with
your
financial
advisor
and
visit
blackrock.com
for
further
insight
about
investing
in
today's
markets.
Sincerely,
Rob
Kapito
President,
BlackRock
Advisors,
LLC
The
Markets
in
Review
Rob
Kapito
President,
BlackRock
Advisors,
LLC
Past
performance
is
not
an
indication
of
future
results.
Index
performance
is
shown
for
illustrative
purposes
only.
You
cannot
invest
directly
in
an
index.
Total
Returns
as
of
September
30,
2021
6-Month
12-Month
U.S.
large
cap
equities
(S&P
500
®
Index)
9.18%
30.00%
U.S.
small
cap
equities
(Russell
2000
®
Index)
(0.25)
47.68
International
equities
(MSCI
Europe,
Australasia,
Far
East
Index)
4.70
25.73
Emerging
market
equities
(MSCI
Emerging
Markets
Index)
(3.45)
18.20
3-month
Treasury
bills
(ICE
BofA
3-Month
U.S.
Treasury
Bill
Index)
0.01
0.07
U.S.
Treasury
securities
(ICE
BofA
10-Year
U.S.
Treasury
Index)
2.92
(6.22)
U.S.
investment
grade
bonds
(Bloomberg
U.S.
Aggregate
Bond
Index)
1.88
(0.90)
Tax-exempt
municipal
bonds
(S&P
Municipal
Bond
Index)
1.24
2.71
U.S.
high
yield
bonds
(Bloomberg
U.S.
Corporate
High
Yield
2%
Issuer
Capped
Index)
3.65
11.27
This
Page
is
not
Part
of
Your
Fund
Report
2
Table
of
Contents
Page
3
The
Markets
in
Review
...................................................................................................
2
Annual
Report:
Fund
Summary
........................................................................................................
4
About
Fund
Performance
..................................................................................................
5
Disclosure
of
Expenses
...................................................................................................
6
Derivative
Financial
Instruments
.............................................................................................
6
Financial
Statements:
Schedule
of
Investments
................................................................................................
7
Statement
of
Assets
and
Liabilities
..........................................................................................
15
Statement
of
Operations
................................................................................................
17
Statement
of
Changes
in
Net
Assets
.........................................................................................
18
Financial
Highlights
.....................................................................................................
19
Notes
to
Financial
Statements
...............................................................................................
22
Report
of
Independent
Registered
Public
Accounting
Firm
..............................................................................
30
Important
Tax
Information
(unaudited)
.................................................................................................
30
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
...................................................................
31
Trustee
and
Officer
Information
..............................................................................................
34
Additional
Information
....................................................................................................
37
Glossary
of
Terms
Used
in
this
Report
..........................................................................................
39
Fund
Summary
as
of
September
30,
2021
2021
BlackRock
Annual
Report
to
Shareholders
4
BlackRock
Sustainable
High
Yield
Bond
Fund
Investment
Objective
BlackRock
Sustainable
High
Yield
Bond
Fund's
(the
"Fund")
investment
objective
is
to
seek
to
maximize
total
return,
consistent
with
income
generation
and
prudent
investment
management,
while
seeking
to
maintain
certain
environmental,
governance
and
social
("ESG")
characteristics,
climate
risk
exposure
and
climate
opportunities
relative
to
the
Fund's
benchmark.
Expense
Example
Portfolio
Information
Actual
Hypothetical
(a)
Beginning
Account
Value
(07/22/21)
(b)
Ending
Account
Value
(09/30/21)
Expenses
Paid
During
the
Period
(c)
Beginning
Account
Value
(07/22/21)
(b)
Ending
Account
Value
(09/30/21)
Expenses
Paid
During
the
Period
(c)
Annualized
Expense
Ratio
Institutional
...............................
$
1,000.00‌
$
1,000.10‌
$
1.11‌
$
1,000.00‌
$
1,022.16‌
$
2.94‌
0.58‌%
Investor
A
................................
1,000.00‌
999.70‌
1.59‌
1,000.00‌
1,020.91‌
4.20‌
0.83‌
Class
K
..................................
1,000.00‌
1,000.20‌
1.02‌
1,000.00‌
1,022.41‌
2.69‌
0.53‌
(a)
Hypothetical
5%
annual
return
before
expenses
is
calculated
by
prorating
the
number
of
days
in
the
most
recent
fiscal
half
year
divided
by
365.
(b)
Commencement
of
operations.
(c)
For
each
class
of
the
Fund,
expenses
are
equal
to
the
annualized
expense
ratio
for
the
class,
multiplied
by
the
average
account
value
over
the
period,
multiplied
by
70/365
(to
reflect
the
period
since
inception
date
of
July
22,
2021
to
September
30,
2021).
See
"Disclosure
of
Expenses"
for
further
information
on
how
expenses
were
calculated.
PORTFOLIO
COMPOSITION
Asset
Type
Percent
of
at
Total
Investments
(a)
Corporate
Bonds
...................................
88‌
%
Floating
Rate
Loan
Interests
...........................
11‌
Common
Stocks
...................................
1‌
(a)
Excludes
short-term
securities.
CREDIT
QUALITY
ALLOCATION
Credit
Rating
(a)
Percent
of
Total
Investments
(b)
BBB/Baa
.......................................
5‌
%
BB/Ba
.........................................
49‌
B
............................................
33‌
CCC/
Caa
.......................................
11‌
NR
...........................................
2‌
(a)
For
financial
reporting
purposes,
credit
quality
ratings
shown
above
reflect
the
highest
rating
assigned
by
either
S&P
Global
Ratings
or
Moody's
Investors
Service
if
ratings
differ.
These
rating
agencies
are
independent,
nationally
recognized
statistical
rating
organizations
and
are
widely
used.
Investment
grade
ratings
are
credit
ratings
of
BBB/
Baa
or
higher.
Below
investment
grade
ratings
are
credit
ratings
of
BB/Ba
or
lower.
Investments
designated
NR
are
not
rated
by
either
rating
agency.
Unrated
investments
do
not
necessarily
indicate
low
credit
quality.
Credit
quality
ratings
are
subject
to
change.
(b)
Excludes
short-term
securities.
About
Fund
Performance
5
About
Fund
Performance
Institutional
and
Class
K
Shares
are
not
subject
to
any
sales
charge.
These
shares
bear
no
ongoing
distribution
or
service
fees
and
are
available
only
to
certain
eligible
investors.
Investor
A
Shares
are
subject
to
a
maximum
initial
sales
charge
(front-end
load)
of
4.00%
and
a
service
fee
of
0.25%
per
year
(but
no
distribution
fee).
Certain
redemptions
of
these
shares
may
be
subject
to
a
contingent
deferred
sales
charge
("CDSC")
where
no
initial
sales
charge
was
paid
at
the
time
of
purchase.
These
shares
are
generally
available
through
financial
intermediaries.
Past
performance
is
not
an
indication
of
future
results.
Financial
markets
have
experienced
extreme
volatility
and
trading
in
many
instruments
has
been
disrupted.
These
circumstances
may
continue
for
an
extended
period
of
time
and
may
continue
to
affect
adversely
the
value
and
liquidity
of
the
Fund's
investments.
As
a
result,
current
performance
may
be
lower
or
higher
than
the
performance
data
quoted.
Refer
to
blackrock.com
to
obtain
performance
data
current
to
the
most
recent
month-end.
Performance
results
do
not
reflect
the
deduction
of
taxes
that
a
shareholder
would
pay
on
Fund
distributions
or
the
redemption
of
Fund
shares.
Investment
return
and
principal
value
of
shares
will
fluctuate
so
that
shares,
when
redeemed,
may
be
worth
more
or
less
than
their
original
cost.
Distributions
paid
to
each
class
of
shares
will
vary
because
of
the
different
levels
of
service,
distribution
and
transfer
agency
fees
applicable
to
each
class,
which
are
deducted
from
the
income
available
to
be
paid
to
shareholders.
BlackRock
Advisors,
LLC
(the
"Manager"),
the
Fund's
investment
adviser,
has
contractually
and/or
voluntarily
agreed
to
waive
and/or
reimburse
a
portion
of
the
Fund's
expenses.
Without
such
waiver(s)
and/or
reimbursement(s),
the
Fund's
performance
would
have
been
lower.
With
respect
to
the
Fund's
voluntary
waiver(s),
if
any,
the
Manager
is
under
no
obligation
to
waive
and/or
reimburse
or
to
continue
waiving
and/or
reimbursing
its
fees
and
such
voluntary
waiver(s)
may
be
reduced
or
discontinued
at
any
time.
With
respect
to
the
Fund's
contractual
waiver(s),
if
any,
the
Manager
is
under
no
obligation
to
continue
waiving
and/or
reimbursing
its
fees
after
the
applicable
termination
date
of
such
agreement.
See
the
Notes
to
Financial
Statements
for
additional
information
on
waivers
and/or
reimbursements.
Disclosure
of
Expenses
2021
BlackRock
Annual
Report
to
Shareholders
6
Shareholders
of
the
Fund
may
incur
the
following
charges:
(a)
transactional
expenses,
such
as
sales
charges;
and
(b)
operating
expenses,
including
investment
advisory
fees, service
and
distribution
fees,
including
12b-1
fees,
acquired
fund
fees
and
expenses, and
other
fund
expenses.
The
expense
example
shown
(which
is
based
on
a
hypothetical
investment
of
$1,000
invested
on July
22,
2021
(commencement
of
operations)
and
held
through
September
30,
2021)
is
intended
to
assist
shareholders
both
in
calculating
expenses
based
on
an
investment
in
the
Fund
and
in
comparing
these
expenses
with
similar
costs
of
investing
in
other
mutual
funds.
The
expense
example
provides
information
about
actual
account
values
and
actual
expenses.
In
order
to
estimate
the
expenses
a
shareholder
paid
during
the
period
covered
by
this
report,
shareholders
can
divide
their
account
value
by
$1,000
and
then
multiply
the
result
by
the
number
corresponding
to
their share
class
under
the
heading
entitled
"Expenses
Paid
During
the
Period."
The
expense
example
also
provides
information
about
hypothetical
account
values
and
hypothetical
expenses
based
on the
Fund's
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses.
In
order
to
assist
shareholders
in
comparing
the
ongoing
expenses
of
investing
in
the
Fund
and
other
funds,
compare
the
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
shareholder
reports
of
other
funds.
The
expenses
shown
in
the
expense
example
are
intended
to
highlight
shareholders'
ongoing
costs
only
and
do
not
reflect
transactional
expenses,
such
as
sales
charges,
if
any.
Therefore,
the
hypothetical
example is
useful
in
comparing
ongoing
expenses
only
and
will
not
help
shareholders
determine
the
relative
total
expenses
of
owning
different
funds.
If
these
transactional
expenses
were
included,
shareholder
expenses
would
have
been
higher.
Derivative
Financial
Instruments
The
Fund
may
invest
in
various
derivative
financial
instruments.
These
instruments
are
used
to
obtain
exposure
to
a
security,
commodity,
index,
market,
and/or
other
assets
without
owning
or
taking
physical
custody
of
securities,
commodities
and/or
other
referenced
assets
or
to
manage
market,
equity,
credit,
interest
rate,
foreign
currency
exchange
rate,
commodity
and/or
other
risks.
Derivative
financial
instruments
may
give
rise
to
a
form
of
economic
leverage
and
involve
risks,
including
the
imperfect
correlation
between
the
value
of
a
derivative
financial
instrument
and
the
underlying
asset,
possible
default
of
the
counterparty
to
the
transaction
or
illiquidity
of
the
instrument.
The
Fund's
successful
use
of
a
derivative
financial
instrument
depends
on
the
investment
adviser's
ability
to
predict
pertinent
market
movements
accurately,
which
cannot
be
assured.
The
use
of
these
instruments
may
result
in
losses
greater
than
if
they
had
not
been
used,
may
limit
the
amount
of
appreciation the
Fund
can
realize
on
an
investment
and/or
may
result
in
lower
distributions
paid
to
shareholders.
The
Fund's
investments
in
these
instruments,
if
any,
are
discussed
in
detail
in
the
Notes
to
Financial
Statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
Schedule
of
Investments
7
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
September
30,
2021
Security
Shares
Shares
Value
Common
Stocks
-
1.4%
Chemicals
-
0.2%
Element
Solutions,
Inc.
...............
4,904
$
106,319
Communications
Equipment
-
0.0%
CommScope
Holding
Co.,
Inc.
(a)
.........
1,173
15,941
Equity
Real
Estate
Investment
Trusts
(REITs)
-
0.4%
VICI
Properties,
Inc.
.................
6,246
177,449
Hotels,
Restaurants
&
Leisure
-
0.2%
Aramark
.........................
2,155
70,813
Life
Sciences
Tools
&
Services
-
0.4%
(a)
Avantor
,
Inc.
......................
2,591
105,972
Syneos
Health,
Inc.
.................
1,154
100,952
206,924
Media
-
0.1%
Clear
Channel
Outdoor
Holdings,
Inc.
(a)
....
20,492
55,533
Road
&
Rail
-
0.1%
Uber
Technologies,
Inc.
(a)
.............
1,052
47,129
Total
Common
Stocks
-
1.4%
(Cost:
$702,903)
................................
680,108
Par
(000)
Par
(000)
Corporate
Bonds
-
86.8%
Aerospace
&
Defense
-
2.4%
Bombardier,
Inc.
(b)(c)
:
7.13%,
06/15/26
.................
USD
76
79,800
7.88%,
04/15/27
.................
107
110,930
6.00%,
02/15/28
.................
85
85,956
TransDigm
,
Inc.:
6.25%,
03/15/26
(b)
................
559
582,758
4.63%,
01/15/29
.................
75
74,869
4.88%,
05/01/29
.................
68
68,126
Triumph
Group,
Inc.,
8.88%,
06/01/24
(b)
...
181
199,100
1,201,539
Airlines
-
2.1%
(b)
American
Airlines,
Inc.:
11.75%,
07/15/25
................
183
226,463
5.75%,
04/20/29
.................
347
373,892
United
Airlines,
Inc.:
4.38%,
04/15/26
.................
264
270,930
4.63%,
04/15/29
.................
144
148,817
1,020,102
Auto
Components
-
1.3%
Clarios
Global
LP
(b)
:
6.75%,
05/15/25
.................
93
98,115
6.25%,
05/15/26
.................
144
151,294
8.50%,
05/15/27
.................
375
398,906
648,315
Automobiles
-
0.1%
Ford
Motor
Co.,
4.75%,
01/15/43
.......
42
44,021
Biotechnology
-
0.0%
Emergent
BioSolutions,
Inc.,
3.88%,
08/15/28
(b)
25
24,313
Building
Products
-
0.8%
(b)
APi
Group
DE,
Inc.,
4.13%,
07/15/29
.....
19
18,617
Cornerstone
Building
Brands,
Inc.,
6.13%,
01/15/29
.....................
137
145,628
JELD-WEN,
Inc.,
4.63%,
12/15/25
......
49
49,751
Security
Par
(000)
Par
(000)
Value
Building
Products
(continued)
Standard
Industries,
Inc.:
4.38%,
07/15/30
.................
USD
95
$
96,900
3.38%,
01/15/31
.................
37
35,213
Victors
Merger
Corp.,
6.38%,
05/15/29
....
44
42,130
388,239
Capital
Markets
-
0.4%
MSCI,
Inc.
(b)
:
3.63%,
09/01/30
.................
84
86,835
3.63%,
11/01/31
.................
39
40,583
3.25%,
08/15/33
.................
66
66,756
194,174
Chemicals
-
2.5%
Ashland
LLC,
3.38%,
09/01/31
(b)
........
109
109,954
Axalta
Coating
Systems
LLC,
3.38%,
02/15/29
(b)
....................
200
194,500
Diamond
BC
BV,
4.63%,
10/01/29
(b)
......
57
57,855
Element
Solutions,
Inc.,
3.88%,
09/01/28
(b)
.
261
263,610
HB
Fuller
Co.,
4.00%,
02/15/27
........
47
49,056
Herens
Midco
SARL,
4.75%,
05/15/28
(b)(c)
..
200
201,000
Ingevity
Corp.,
3.88%,
11/01/28
(b)
.......
25
24,937
Minerals
Technologies,
Inc.,
5.00%,
07/01/28
(b)
77
79,888
Scotts
Miracle-
Gro
Co.
(The)
(b)
:
4.00%,
04/01/31
.................
24
23,955
4.38%,
02/01/32
.................
7
7,057
WR
Grace
Holdings
LLC,
5.63%,
08/15/29
(b)
226
232,782
1,244,594
Commercial
Services
&
Supplies
-
3.4%
ADT
Security
Corp.
(The),
4.88%,
07/15/32
(b)
129
130,129
Allied
Universal
Holdco
LLC
(b)
:
6.63%,
07/15/26
.................
185
195,597
9.75%,
07/15/27
.................
160
174,076
4.63%,
06/01/28
.................
200
199,690
APX
Group,
Inc.
(b)
:
6.75%,
02/15/27
.................
26
27,621
5.75%,
07/15/29
.................
50
49,353
Aramark
Services,
Inc.,
5.00%,
02/01/28
(b)
..
27
27,742
Covanta
Holding
Corp.,
5.00%,
09/01/30
..
70
70,700
Garda
World
Security
Corp.
(b)(c)
:
4.63%,
02/15/27
.................
46
46,000
9.50%,
11/01/27
.................
70
75,764
GFL
Environmental,
Inc.
(b)(c)
:
4.00%,
08/01/28
.................
17
16,873
4.75%,
06/15/29
.................
67
68,842
4.38%,
08/15/29
.................
33
33,330
Legends
Hospitality
Holding
Co.
LLC,
5.00%,
02/01/26
(b)
....................
41
42,025
Madison
IAQ
LLC
(b)
:
4.13%,
06/30/28
.................
51
51,000
5.88%,
06/30/29
.................
92
92,690
Nielsen
Finance
LLC
(b)
:
5.88%,
10/01/30
.................
125
131,609
4.75%,
07/15/31
.................
57
55,447
Prime
Security
Services
Borrower
LLC
(b)
:
5.75%,
04/15/26
.................
54
58,415
6.25%,
01/15/28
.................
83
85,804
WASH
Multifamily
Acquisition,
Inc.,
5.75%,
04/15/26
(b)
....................
50
52,211
1,684,918
Communications
Equipment
-
1.6%
Avaya,
Inc.,
6.13%,
09/15/28
(b)
.........
225
236,581
CommScope
Technologies
LLC,
6.00%,
06/15/25
(b)
....................
81
82,012
2021
BlackRock
Annual
Report
to
Shareholders
BlackRock
Sustainable
High
Yield
Bond
Fund
8
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
(continued)
September
30,
2021
Security
Par
(000)
Par
(000)
Value
Communications
Equipment
(continued)
CommScope
,
Inc.
(b)
:
6.00%,
03/01/26
.................
USD
93
$
96,565
7.13%,
07/01/28
.................
30
30,614
4.75%,
09/01/29
.................
121
120,849
Nokia
OYJ,
6.63%,
05/15/39
(c)
.........
115
156,975
Viavi
Solutions,
Inc.,
3.75%,
10/01/29
(b)
...
69
69,152
792,748
Consumer
Finance
-
1.8%
Ford
Motor
Credit
Co.
LLC:
4.13%,
08/04/25
.................
200
211,500
4.39%,
01/08/26
.................
200
213,250
4.13%,
08/17/27
.................
200
212,100
2.90%,
02/16/28
.................
200
199,750
OneMain
Finance
Corp.:
7.13%,
03/15/26
.................
44
50,985
6.63%,
01/15/28
.................
20
23,000
910,585
Containers
&
Packaging
-
2.4%
ARD
Finance
SA,
6.50%,
06/30/27
(b)(c)
....
200
212,470
Ball
Corp.:
2.88%,
08/15/30
.................
252
244,598
3.13%,
09/15/31
.................
127
125,422
Crown
Americas
LLC,
4.25%,
09/30/26
...
161
172,574
Intertape
Polymer
Group,
Inc.,
4.38%,
06/15/29
(b)(c)
...................
25
25,415
Sealed
Air
Corp.,
4.00%,
12/01/27
(b)
.....
164
174,644
Trivium
Packaging
Finance
BV,
8.50%,
08/15/27
(b)(c)(d)
..................
228
244,815
1,199,938
Distributors
-
0.0%
American
Builders
&
Contractors
Supply
Co.,
Inc.,
3.88%,
11/15/29
(b)
............
18
17,950
Diversified
Financial
Services
-
0.5%
(b)
MPH
Acquisition
Holdings
LLC,
5.50%,
09/01/28
.....................
78
77,785
Sabre
GLBL,
Inc.:
9.25%,
04/15/25
.................
42
48,543
7.38%,
09/01/25
.................
30
31,974
Shift4
Payments
LLC,
4.63%,
11/01/26
....
66
68,888
227,190
Diversified
Telecommunication
Services
-
6.8%
Altice
France
Holding
SA,
6.00%,
02/15/28
(b)(c)
200
192,095
Altice
France
SA
(b)(c)
:
5.13%,
07/15/29
.................
200
196,095
5.50%,
10/15/29
.................
200
197,976
CCO
Holdings
LLC
(b)
:
4.50%,
08/15/30
.................
70
72,220
4.25%,
02/01/31
.................
19
19,330
4.50%,
06/01/33
.................
19
19,337
4.25%,
01/15/34
.................
203
201,097
Consolidated
Communications,
Inc.,
6.50%,
10/01/28
(b)
....................
150
162,938
Frontier
Communications
Corp.
(b)
:
5.88%,
10/15/27
.................
110
116,875
6.75%,
05/01/29
.................
163
171,761
Level
3
Financing,
Inc.
(b)
:
4.25%,
07/01/28
.................
69
69,533
3.75%,
07/15/29
.................
103
99,548
Lumen
Technologies,
Inc.:
5.13%,
12/15/26
(b)
................
175
181,562
5.38%,
06/15/29
(b)
................
232
236,724
Series
P,
7.60%,
09/15/39
..........
38
42,560
Security
Par
(000)
Par
(000)
Value
Diversified
Telecommunication
Services
(continued)
Sprint
Capital
Corp.:
6.88%,
11/15/28
.................
USD
212
$
271,360
8.75%,
03/15/32
.................
244
364,502
Switch
Ltd.
(b)
:
3.75%,
09/15/28
.................
54
54,810
4.13%,
06/15/29
.................
143
146,754
Telecom
Italia
Capital
SA
(c)
:
6.38%,
11/15/33
.................
124
144,299
6.00%,
09/30/34
.................
71
79,697
Zayo
Group
Holdings,
Inc.
(b)
:
4.00%,
03/01/27
.................
115
114,451
6.13%,
03/01/28
.................
228
231,142
3,386,666
Electric
Utilities
-
3.1%
NextEra
Energy
Operating
Partners
LP,
4.25%,
09/15/24
(b)
....................
233
245,815
NRG
Energy,
Inc.
(b)
:
3.63%,
02/15/31
.................
274
269,137
3.88%,
02/15/32
.................
110
108,762
Pattern
Energy
Operations
LP,
4.50%,
08/15/28
(b)
....................
832
867,360
PG&E
Corp.,
5.25%,
07/01/30
.........
43
44,021
1,535,095
Electronic
Equipment,
Instruments
&
Components
-
0.1%
CDW
LLC,
3.25%,
02/15/29
..........
65
66,625
Entertainment
-
0.7%
Live
Nation
Entertainment,
Inc.
(b)
:
6.50%,
05/15/27
.................
135
148,500
4.75%,
10/15/27
.................
24
24,390
3.75%,
01/15/28
.................
25
24,851
Netflix,
Inc.:
4.88%,
04/15/28
.................
35
40,338
5.88%,
11/15/28
.................
32
39,213
Playtika
Holding
Corp.,
4.25%,
03/15/29
(b)
..
95
95,303
372,595
Equity
Real
Estate
Investment
Trusts
(REITs)
-
3.0%
Brookfield
Property
REIT,
Inc.,
4.50%,
04/01/27
(b)
....................
43
42,570
CTR
Partnership
LP,
3.88%,
06/30/28
(b)
...
23
23,862
HAT
Holdings
I
LLC,
3.38%,
06/15/26
(b)
...
106
107,590
Iron
Mountain,
Inc.
(b)
:
5.25%,
07/15/30
.................
92
97,633
5.63%,
07/15/32
.................
85
91,163
MGM
Growth
Properties
Operating
Partnership
LP:
4.50%,
09/01/26
.................
185
201,187
4.50%,
01/15/28
.................
69
75,383
RHP
Hotel
Properties
LP:
4.75%,
10/15/27
.................
46
47,609
4.50%,
02/15/29
(b)
................
26
26,052
RLJ
Lodging
Trust
LP
(b)
:
3.75%,
07/01/26
.................
15
15,075
4.00%,
09/15/29
.................
24
23,963
Uniti
Group
LP
(b)
:
4.75%,
04/15/28
.................
135
137,869
6.50%,
02/15/29
.................
102
104,924
6.00%,
01/15/30
.................
30
29,737
VICI
Properties
LP
(b)
:
4.25%,
12/01/26
.................
144
150,383
4.63%,
12/01/29
.................
93
99,975
4.13%,
08/15/30
.................
190
201,400
1,476,375
BlackRock
Sustainable
High
Yield
Bond
Fund
Schedule
of
Investments
9
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
(continued)
September
30,
2021
Security
Par
(000)
Par
(000)
Value
Food
&
Staples
Retailing
-
1.4%
(b)
Albertsons
Cos.,
Inc.:
3.25%,
03/15/26
.................
USD
284
$
288,260
4.88%,
02/15/30
.................
115
123,912
United
Natural
Foods,
Inc.,
6.75%,
10/15/28
106
114,745
US
Foods,
Inc.:
6.25%,
04/15/25
.................
100
104,895
4.75%,
02/15/29
.................
83
85,179
716,991
Food
Products
-
2.5%
Chobani
LLC,
4.63%,
11/15/28
(b)
........
95
98,087
Kraft
Heinz
Foods
Co.:
4.25%,
03/01/31
.................
325
367,419
6.88%,
01/26/39
.................
84
124,012
5.20%,
07/15/45
.................
118
147,800
5.50%,
06/01/50
.................
285
376,021
Lamb
Weston
Holdings,
Inc.,
4.88%,
05/15/28
(b)
135
148,399
1,261,738
Gas
Utilities
-
0.0%
Suburban
Propane
Partners
LP,
5.00%,
06/01/31
(b)
....................
24
24,900
Health
Care
Equipment
&
Supplies
-
1.8%
(b)
Avantor
Funding,
Inc.,
4.63%,
07/15/28
...
181
190,502
Hologic,
Inc.,
3.25%,
02/15/29
.........
122
122,058
Mozart
Debt
Merger
Sub,
Inc.:
3.88%,
04/01/29
.................
96
96,000
5.25%,
10/01/29
.................
218
218,000
Ortho-Clinical
Diagnostics,
Inc.:
7.38%,
06/01/25
.................
92
97,060
7.25%,
02/01/28
.................
152
162,659
886,279
Health
Care
Providers
&
Services
-
5.5%
AHP
Health
Partners,
Inc.,
5.75%,
07/15/29
(b)
79
79,790
Cano
Health
LLC,
6.25%,
10/01/28
(b)
.....
22
22,220
Centene
Corp.:
2.45%,
07/15/28
.................
88
88,440
3.00%,
10/15/30
.................
400
410,000
2.50%,
03/01/31
.................
129
127,227
2.63%,
08/01/31
.................
101
100,317
Community
Health
Systems,
Inc.
(b)
:
6.63%,
02/15/25
.................
83
86,839
8.00%,
03/15/26
.................
86
91,201
6.00%,
01/15/29
.................
151
160,060
6.88%,
04/15/29
.................
18
18,042
6.13%,
04/01/30
.................
39
37,897
DaVita,
Inc.,
4.63%,
06/01/30
(b)
........
6
6,172
Encompass
Health
Corp.:
4.50%,
02/01/28
.................
142
146,615
4.63%,
04/01/31
.................
138
145,045
HCA,
Inc.:
5.63%,
09/01/28
.................
147
174,886
3.50%,
09/01/30
.................
181
191,749
HealthEquity,
Inc.,
4.50%,
10/01/29
(b)
.....
59
59,885
LifePoint
Health,
Inc.,
5.38%,
01/15/29
(b)
...
102
99,195
MEDNAX,
Inc.,
6.25%,
01/15/27
(b)
.......
68
71,485
Molina
Healthcare,
Inc.
(b)
:
4.38%,
06/15/28
.................
100
104,038
3.88%,
11/15/30
.................
66
68,970
Tenet
Healthcare
Corp.
(b)
:
4.88%,
01/01/26
.................
115
119,016
5.13%,
11/01/27
.................
118
123,015
6.13%,
10/01/28
.................
64
67,230
4.25%,
06/01/29
.................
73
74,095
Security
Par
(000)
Par
(000)
Value
Health
Care
Providers
&
Services
(continued)
Vizient,
Inc.,
6.25%,
05/15/27
(b)
........
USD
47
$
49,115
2,722,544
Hotels,
Restaurants
&
Leisure
-
5.5%
1011778
BC
ULC
(b)(c)
:
3.88%,
01/15/28
.................
57
57,562
4.38%,
01/15/28
.................
82
83,247
Boyne
USA,
Inc.,
4.75%,
05/15/29
(b)
.....
95
98,087
Caesars
Entertainment,
Inc.
(b)
:
6.25%,
07/01/25
.................
163
171,599
8.13%,
07/01/27
.................
217
243,957
4.63%,
10/15/29
.................
117
118,463
Caesars
Resort
Collection
LLC,
5.75%,
07/01/25
(b)
....................
92
96,989
Cedar
Fair
LP,
5.50%,
05/01/25
(b)
.......
122
126,728
Golden
Nugget,
Inc.,
6.75%,
10/15/24
(b)
...
98
98,127
Hilton
Domestic
Operating
Co.,
Inc.:
5.75%,
05/01/28
(b)
................
46
49,542
4.88%,
01/15/30
.................
245
262,826
4.00%,
05/01/31
(b)
................
98
99,470
MajorDrive
Holdings
IV
LLC,
6.38%,
06/01/29
(b)
50
48,323
Merlin
Entertainments
Ltd.,
5.75%,
06/15/26
(b)(c)
200
206,500
MGM
Resorts
International,
5.75%,
06/15/25
90
98,100
Midwest
Gaming
Borrower
LLC,
4.88%,
05/01/29
(b)
....................
59
60,106
Scientific
Games
International,
Inc.
(b)
:
8.25%,
03/15/26
.................
35
37,144
7.25%,
11/15/29
.................
44
49,440
Six
Flags
Theme
Parks,
Inc.,
7.00%,
07/01/25
(b)
261
277,965
Travel
+
Leisure
Co.,
6.63%,
07/31/26
(b)
...
39
44,412
Vail
Resorts,
Inc.,
6.25%,
05/15/25
(b)
.....
93
98,347
Wyndham
Hotels
&
Resorts,
Inc.,
4.38%,
08/15/28
(b)
....................
71
74,119
Wynn
Resorts
Finance
LLC,
5.13%,
10/01/29
(b)
116
116,870
Yum!
Brands,
Inc.,
4.75%,
01/15/30
(b)
.....
91
98,628
2,716,551
Household
Durables
-
1.3%
Ashton
Woods
USA
LLC
(b)
:
4.63%,
08/01/29
.................
50
50,486
4.63%,
04/01/30
.................
24
24,135
CD&R
Smokey
Buyer,
Inc.,
6.75%,
07/15/25
(b)
68
71,942
KB
Home,
4.00%,
06/15/31
...........
24
24,630
Newell
Brands,
Inc.:
4.88%,
06/01/25
.................
90
99,333
6.00%,
04/01/46
(d)
................
38
49,115
SWF
Escrow
Issuer
Corp.,
6.50%,
10/01/29
(b)
55
53,587
Taylor
Morrison
Communities,
Inc.,
5.88%,
06/15/27
(b)
....................
66
75,240
Tempur
Sealy
International,
Inc.
(b)
:
4.00%,
04/15/29
.................
48
49,440
3.88%,
10/15/31
.................
70
70,088
Williams
Scotsman
International,
Inc.,
4.63%,
08/15/28
(b)
....................
76
79,170
647,166
Independent
Power
and
Renewable
Electricity
Producers
-
1.9%
Clearway
Energy
Operating
LLC
(b)
:
4.75%,
03/15/28
.................
823
871,228
3.75%,
01/15/32
.................
86
85,892
957,120
Insurance
-
1.8%
(b)
Alliant
Holdings
Intermediate
LLC:
4.25%,
10/15/27
.................
147
148,470
6.75%,
10/15/27
.................
268
277,380
AssuredPartners,
Inc.,
5.63%,
01/15/29
...
87
87,540
BroadStreet
Partners,
Inc.,
5.88%,
04/15/29
49
48,816
2021
BlackRock
Annual
Report
to
Shareholders
BlackRock
Sustainable
High
Yield
Bond
Fund
10
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
(continued)
September
30,
2021
Security
Par
(000)
Par
(000)
Value
Insurance
(continued)
GTCR
AP
Finance,
Inc.,
8.00%,
05/15/27
..
USD
27
$
28,485
NFP
Corp.:
4.88%,
08/15/28
.................
110
111,870
6.88%,
08/15/28
.................
202
206,252
908,813
Interactive
Media
&
Services
-
0.4%
(b)
Rackspace
Technology
Global,
Inc.,
5.38%,
12/01/28
.....................
83
81,547
Twitter,
Inc.,
3.88%,
12/15/27
..........
99
105,683
187,230
Internet
&
Direct
Marketing
Retail
-
0.4%
(b)
ANGI
Group
LLC,
3.88%,
08/15/28
......
49
48,755
Go
Daddy
Operating
Co.
LLC,
3.50%,
03/01/29
66
65,423
Match
Group
Holdings
II
LLC:
4.63%,
06/01/28
.................
17
17,773
4.13%,
08/01/30
.................
24
24,990
3.63%,
10/01/31
.................
26
25,691
182,632
IT
Services
-
2.0%
Ahead
DB
Holdings
LLC,
6.63%,
05/01/28
(b)
42
42,315
Austin
BidCo,
Inc.,
7.13%,
12/15/28
(b)
.....
73
73,548
Black
Knight
InfoServ
LLC,
3.63%,
09/01/28
(b)
96
96,480
Booz
Allen
Hamilton,
Inc.,
4.00%,
07/01/29
(b)
97
99,425
Gartner,
Inc.
(b)
:
4.50%,
07/01/28
.................
100
105,000
3.63%,
06/15/29
.................
29
29,221
3.75%,
10/01/30
.................
66
67,927
Northwest
Fiber
LLC
(b)
:
4.75%,
04/30/27
.................
49
49,288
6.00%,
02/15/28
.................
80
79,574
Square,
Inc.,
3.50%,
06/01/31
(b)
........
166
170,271
Twilio,
Inc.,
3.88%,
03/15/31
..........
170
174,048
Unisys
Corp.,
6.88%,
11/01/27
(b)
........
27
29,497
1,016,594
Life
Sciences
Tools
&
Services
-
0.6%
(b)
Charles
River
Laboratories
International,
Inc.:
4.25%,
05/01/28
.................
127
131,807
4.00%,
03/15/31
.................
71
74,389
Syneos
Health,
Inc.,
3.63%,
01/15/29
....
74
73,793
279,989
Machinery
-
0.7%
(b)
Mueller
Water
Products,
Inc.,
4.00%,
06/15/29
112
115,942
TK
Elevator
US
Newco,
Inc.,
5.25%,
07/15/27
(c)
200
209,595
325,537
Media
-
6.8%
(b)
Advantage
Sales
&
Marketing,
Inc.,
6.50%,
11/15/28
.....................
42
43,774
Altice
Financing
SA,
5.75%,
08/15/29
(c)
....
200
193,726
Cable
One,
Inc.:
1.13%,
03/15/28
(e)
................
147
149,151
4.00%,
11/15/30
.................
24
23,910
Clear
Channel
Outdoor
Holdings,
Inc.:
7.75%,
04/15/28
.................
120
126,300
7.50%,
06/01/29
.................
158
164,320
Clear
Channel
Worldwide
Holdings,
Inc.,
5.13%,
08/15/27
................
191
197,649
CSC
Holdings
LLC,
5.00%,
11/15/31
.....
200
191,690
DIRECTV
Holdings
LLC,
5.88%,
08/15/27
..
101
105,419
LCPR
Senior
Secured
Financing
DAC,
5.13%,
07/15/29
.....................
200
205,990
Liberty
Broadband
Corp.,
2.75%,
09/30/50
(e)
184
194,238
Radiate
Holdco
LLC:
4.50%,
09/15/26
.................
113
116,672
Security
Par
(000)
Par
(000)
Value
Media
(continued)
6.50%,
09/15/28
.................
USD
207
$
211,070
Sinclair
Television
Group,
Inc.,
4.13%,
12/01/30
57
55,717
Sirius
XM
Radio,
Inc.:
3.13%,
09/01/26
.................
117
118,609
4.00%,
07/15/28
.................
138
140,328
5.50%,
07/01/29
.................
83
89,744
3.88%,
09/01/31
.................
178
173,884
Telenet
Finance
Luxembourg
Notes
SARL,
5.50%,
03/01/28
(c)
...............
200
210,100
Videotron
Ltd.,
3.63%,
06/15/29
(c)
.......
46
46,632
Virgin
Media
Vendor
Financing
Notes
IV
DAC,
5.00%,
07/15/28
(c)
...............
200
206,570
Ziggo
Bond
Co.
BV,
5.13%,
02/28/30
(c)
....
200
205,095
Ziggo
BV,
5.50%,
01/15/27
(c)
..........
182
188,143
3,358,731
Metals
&
Mining
-
2.0%
Big
River
Steel
LLC,
6.63%,
01/31/29
(b)
...
705
762,281
Freeport-McMoRan,
Inc.,
5.45%,
03/15/43
.
202
248,713
1,010,994
Multiline
Retail
-
0.2%
NMG
Holding
Co.,
Inc.,
7.13%,
04/01/26
(b)
..
75
79,594
Oil,
Gas
&
Consumable
Fuels
-
4.3%
Antero
Midstream
Partners
LP
(b)
:
7.88%,
05/15/26
.................
87
95,130
5.75%,
03/01/27
.................
140
144,627
EnLink
Midstream
Partners
LP:
4.85%,
07/15/26
.................
23
24,143
5.60%,
04/01/44
.................
52
49,660
ITT
Holdings
LLC,
6.50%,
08/01/29
(b)
.....
98
98,858
New
Fortress
Energy,
Inc.
(b)
:
6.75%,
09/15/25
.................
191
183,838
6.50%,
09/30/26
.................
240
229,500
NuStar
Logistics
LP,
5.75%,
10/01/25
.....
56
60,340
Occidental
Petroleum
Corp.:
5.50%,
12/01/25
.................
210
232,575
5.55%,
03/15/26
.................
250
277,500
6.13%,
01/01/31
.................
228
273,708
6.20%,
03/15/40
.................
380
447,526
2,117,405
Personal
Products
-
0.0%
Prestige
Brands,
Inc.,
3.75%,
04/01/31
(b)
...
25
24,125
Pharmaceuticals
-
2.3%
(b)
Bausch
Health
Americas,
Inc.,
8.50%,
01/31/27
88
93,738
Bausch
Health
Cos.,
Inc.:
7.00%,
01/15/28
.................
70
71,729
4.88%,
06/01/28
.................
53
54,921
6.25%,
02/15/29
.................
150
148,428
Catalent
Pharma
Solutions,
Inc.:
3.13%,
02/15/29
.................
94
92,303
3.50%,
04/01/30
.................
100
100,000
Jazz
Securities
DAC,
4.38%,
01/15/29
....
200
207,260
Organon
&
Co.,
5.13%,
04/30/31
.......
200
210,070
P&L
Development
LLC,
7.75%,
11/15/25
...
57
59,206
Par
Pharmaceutical,
Inc.,
7.50%,
04/01/27
.
109
111,044
1,148,699
Professional
Services
-
0.6%
(b)
AMN
Healthcare,
Inc.,
4.00%,
04/15/29
...
73
75,190
ASGN,
Inc.,
4.63%,
05/15/28
..........
70
72,450
Korn
Ferry,
4.63%,
12/15/27
..........
134
139,025
286,665
BlackRock
Sustainable
High
Yield
Bond
Fund
Schedule
of
Investments
11
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
(continued)
September
30,
2021
Security
Par
(000)
Par
(000)
Value
Real
Estate
Management
&
Development
-
0.6%
(b)
Cushman
&
Wakefield
US
Borrower
LLC,
6.75%,
05/15/28
................
USD
109
$
118,265
Howard
Hughes
Corp.
(The):
5.38%,
08/01/28
.................
117
123,289
4.38%,
02/01/31
.................
50
50,295
291,849
Road
&
Rail
-
0.6%
(b)
NESCO
Holdings
II,
Inc.,
5.50%,
04/15/29
..
48
49,786
Uber
Technologies,
Inc.:
7.50%,
09/15/27
.................
46
50,226
6.25%,
01/15/28
.................
72
77,219
4.50%,
08/15/29
.................
112
112,770
290,001
Software
-
3.1%
Boxer
Parent
Co.,
Inc.,
7.13%,
10/02/25
(b)
..
53
56,570
Camelot
Finance
SA,
4.50%,
11/01/26
(b)
...
47
48,821
Clarivate
Science
Holdings
Corp.
(b)
:
3.88%,
07/01/28
.................
83
83,000
4.88%,
07/01/29
.................
73
73,142
Consensus
Cloud
Solutions,
Inc.
(b)
:
6.00%,
10/15/26
.................
17
17,468
6.50%,
10/15/28
.................
15
15,566
Crowdstrike
Holdings,
Inc.,
3.00%,
02/15/29
76
75,745
Elastic
NV,
4.13%,
07/15/29
(b)
.........
151
151,755
Fair
Isaac
Corp.,
4.00%,
06/15/28
(b)
......
72
73,800
MicroStrategy,
Inc.,
6.13%,
06/15/28
(b)
....
70
70,700
Open
Text
Corp.,
3.88%,
02/15/28
(b)(c)
.....
65
66,300
Open
Text
Holdings,
Inc.,
4.13%,
02/15/30
(b)(c)
76
78,090
PTC,
Inc.,
4.00%,
02/15/28
(b)
..........
123
126,229
Rocket
Software,
Inc.,
6.50%,
02/15/29
(b)
..
108
106,920
SS&C
Technologies,
Inc.,
5.50%,
09/30/27
(b)
194
204,851
Veritas
US,
Inc.,
7.50%,
09/01/25
(b)
......
178
185,120
ZoomInfo
Technologies
LLC,
3.88%,
02/01/29
(b)
106
105,470
1,539,547
Specialty
Retail
-
2.3%
Carvana
Co.
(b)
:
5.50%,
04/15/27
.................
43
43,890
4.88%,
09/01/29
.................
29
28,719
Gap,
Inc.
(The)
(b)
:
3.63%,
10/01/29
.................
31
31,077
3.88%,
10/01/31
.................
24
24,000
Group
1
Automotive,
Inc.,
4.00%,
08/15/28
(b)
48
48,840
GYP
Holdings
III
Corp.,
4.63%,
05/01/29
(b)
..
98
99,103
L
Brands,
Inc.:
6.63%,
10/01/30
(b)
................
71
80,585
6.88%,
11/01/35
.................
54
67,770
LBM
Acquisition
LLC,
6.25%,
01/15/29
(b)
...
118
117,941
Lithia
Motors,
Inc.,
3.88%,
06/01/29
(b)
.....
67
69,543
Penske
Automotive
Group,
Inc.,
3.75%,
06/15/29
.....................
17
17,096
PetSmart,
Inc.,
7.75%,
02/15/29
(b)
.......
250
272,812
Specialty
Building
Products
Holdings
LLC,
6.38%,
09/30/26
(b)
...............
59
61,950
SRS
Distribution,
Inc.
(b)
:
4.63%,
07/01/28
.................
100
102,020
6.13%,
07/01/29
.................
79
81,370
1,146,716
Technology
Hardware,
Storage
&
Peripherals
-
0.1%
Xerox
Corp.,
4.80%,
03/01/35
.........
56
56,011
Textiles,
Apparel
&
Luxury
Goods
-
0.6%
(b)
Crocs,
Inc.,
4.13%,
08/15/31
..........
111
111,832
Levi
Strauss
&
Co.,
3.50%,
03/01/31
.....
173
174,730
286,562
Security
Par
(000)
Par
(000)
Value
Thrifts
&
Mortgage
Finance
-
0.8%
Enact
Holdings,
Inc.,
6.50%,
08/15/25
(b)
...
USD
155
$
169,224
MGIC
Investment
Corp.,
5.25%,
08/15/28
..
69
73,627
Nationstar
Mortgage
Holdings,
Inc.
(b)
:
6.00%,
01/15/27
.................
129
135,037
5.13%,
12/15/30
.................
19
19,042
396,930
Trading
Companies
&
Distributors
-
1.6%
Beacon
Roofing
Supply,
Inc.,
4.13%,
05/15/29
(b)
60
59,625
Boise
Cascade
Co.,
4.88%,
07/01/30
(b)
....
61
65,118
Foundation
Building
Materials,
Inc.,
6.00%,
03/01/29
(b)
....................
130
127,400
Herc
Holdings,
Inc.,
5.50%,
07/15/27
(b)
....
111
116,464
Imola
Merger
Corp.,
4.75%,
05/15/29
(b)
....
119
123,108
United
Rentals
North
America,
Inc.,
5.25%,
01/15/30
.....................
66
72,270
WESCO
Distribution,
Inc.,
7.25%,
06/15/28
(b)
223
246,972
810,957
Wireless
Telecommunication
Services
-
2.1%
Connect
Finco
SARL,
6.75%,
10/01/26
(b)(c)
..
333
348,401
T-Mobile
USA,
Inc.:
2.63%,
02/15/29
.................
111
112,172
2.88%,
02/15/31
.................
293
295,491
Vmed
O2
UK
Financing
I
plc,
4.75%,
07/15/31
(b)
(c)
.........................
296
302,417
1,058,481
Total
Corporate
Bonds
-
86.8%
(Cost:
$43,375,941)
..............................
43,173,333
Floating
Rate
Loan
Interests
-
10.3%
Auto
Components
-
0.4%
Clarios
Global
LP,
1st
Lien
Term
Loan,
(LIBOR
USD
1
Month
+
3.25%),
3.33%
,
04/30/26
(f)
187
186,420
Chemicals
-
0.2%
WR
Grace
Holdings
LLC,
Term
Loan,
09/22/28
(f)
(g)
...........................
76
76,238
Commercial
Services
&
Supplies
-
0.2%
GFL
Environmental,
Inc.,
Term
Loan,
(LIBOR
USD
3
Month
+
3.00%),
3.50%
,
05/30/25
(c)(f)
125
124,842
Construction
&
Engineering
-
0.2%
SRS
Distribution,
Inc.,
Term
Loan,
(LIBOR
USD
3
Month
+
3.75%),
4.25%
,
06/02/28
(f)
...
101
100,958
Construction
Materials
-
0.2%
Standard
Industries,
Inc.,
Term
Loan,
09/22/28
(f)
(g)
...........................
115
115,062
Diversified
Financial
Services
-
0.5%
(f)(g)
Connect
Finco
SARL,
Term
Loan,
12/11/26
(c)
150
150,054
LBM
Acquisition
LLC,
1st
Lien
Term
Loan,
12/17/27
......................
101
99,990
250,044
Diversified
Telecommunication
Services
-
1.9%
(f)
Altice
France
SA,
Term
Loan
B13,
(LIBOR
USD
3
Month
+
4.00%),
4.12%
,
08/14/26
(c)
...
201
200,162
Cablevision
Lightpath
LLC,
Term
Loan,
(LIBOR
USD
1
Month
+
3.25%),
3.75%
,
11/30/27
.
100
100,075
Frontier
Communications
Holdings
LLC,
Term
Loan
B,
(LIBOR
USD
3
Month
+
3.75%),
4.50%
,
05/01/28
.................
200
199,562
Northwest
Fiber
LLC,
1st
Lien
Term
Loan
B2,
04/30/27
(g)
.....................
150
149,399
2021
BlackRock
Annual
Report
to
Shareholders
BlackRock
Sustainable
High
Yield
Bond
Fund
12
(Percentages
shown
are
based
on
Net
Assets)
Schedule
of
Investments
(continued)
September
30,
2021
Security
Par
(000)
Par
(000)
Value
Diversified
Telecommunication
Services
(continued)
Zayo
Group
Holdings,
Inc.,
Term
Loan,
(LIBOR
USD
1
Month
+
3.00%),
3.08%
,
03/09/27
USD
303
$
300,173
949,371
Health
Care
Providers
&
Services
-
0.3%
Ortho-Clinical
Diagnostics,
Inc.,
Term
Loan,
(LIBOR
USD
1
Month
+
3.00%),
3.08%
,
06/30/25
(c)(f)
...............
150
149,813
Health
Care
Technology
-
0.7%
Verscend
Holding
Corp.,
Term
Loan
B1,
(LIBOR
USD
1
Month
+
4.00%),
4.08%
,
08/27/25
(f)
350
350,290
Hotels,
Restaurants
&
Leisure
-
0.6%
(f)
Caesars
Resort
Collection
LLC,
Term
Loan
B1,
07/21/25
(g)
.....................
150
149,676
Golden
Nugget,
Inc.,
Term
Loan
B,
(LIBOR
USD
2
Month
+
2.50%),
3.25%
,
10/04/23
151
149,778
299,454
Household
Durables
-
0.1%
SWF
Holdings
I
Corp.,
Term
Loan
B,
09/17/28
(f)
(g)
...........................
65
64,472
Insurance
-
0.9%
(f)
Alliant
Holdings
Intermediate
LLC,
Term
Loan
(g)
:
05/09/25
......................
101
99,984
11/05/27
......................
100
99,776
AssuredPartners
,
Inc.,
Term
Loan,
02/12/27
(g)
100
99,575
Hub
International
Ltd.,
Term
Loan
B3,
(LIBOR
USD
3
Month
+
3.25%),
4.00%
,
04/25/25
150
149,623
448,958
Interactive
Media
&
Services
-
0.3%
Camelot
US
Acquisition
1
Co.,
Term
Loan,
(LIBOR
USD
1
Month
+
3.00%),
4.00%
,
10/30/26
(f)
................
150
149,951
IT
Services
-
0.3%
Rackspace
Technology
Global,
Inc.,
1st
LienTerm
Loan
B,
02/15/28
(f)(g)
........
132
130,667
Machinery
-
0.2%
Madison
IAQ
LLC,
Term
Loan,
(LIBOR
USD
3
Month
+
3.25%),
3.75%
,
06/21/28
(f)
.....
100
99,833
Media
-
1.1%
(f)
Clear
Channel
Outdoor
Holdings,
Inc.,
Term
Loan
B,
08/21/26
(g)
................
307
300,584
DirectTV
Financing
LLC,
Term
Loan,
08/02/27
(g)
117
117,036
Security
Par
(000)
Par
(000)
Value
Media
(continued)
Radiate
Holdco
LLC,
Term
Loan
B,
(LIBOR
USD
1
Month
+
3.50%),
4.25%
,
09/25/26
USD
125
$
124,506
542,126
Pharmaceuticals
-
0.2%
Endo
Luxembourg
Finance
Co.
I
SARL,
Term
Loan,
(LIBOR
USD
3
Month
+
5.00%),
5.75%
,
03/27/28
(c)(f)
...............
78
75,946
Professional
Services
-
0.2%
Dun
&
Bradstreet
Corp.
(The),
Term
Loan,
(LIBOR
USD
1
Month
+
3.25%),
3.34%
,
02/06/26
(f)
................
100
99,624
Road
&
Rail
-
0.2%
Uber
Technologies,
Inc.,
Term
Loan,
(LIBOR
USD
1
Month
+
3.50%),
3.58%
,
02/25/27
(f)
100
99,655
Software
-
1.2%
(f)
BMC
Software,
Inc.,
2nd
Lien
Term
Loan,
02/27/26
(g)(h)
....................
96
97,080
Boxer
Parent
Co.,
Inc.,
Term
Loan,
10/02/25
(g)
174
173,442
Castle
US
Holding
Corp.,
Term
Loan,
01/29/27
(g)
.....................
152
150,332
Sabre
GLBL,
Inc.,
Term
Loan
B1,
12/17/27
(g)
29
28,669
Sabre
GLBL,
Inc.,
Term
Loan
B2,
12/17/27
(g)
46
45,699
SS&C
Technologies
Holdings,
Inc.,
Term
Loan
B5,
(LIBOR
USD
1
Month
+
1.75%),
1.83%
,
04/16/25
.................
101
99,747
594,969
Specialty
Retail
-
0.4%
PetSmart
LLC,
Term
Loan,
(LIBOR
USD
3
Month
+
3.75%),
4.50%
,
02/11/28
(f)
.....
200
200,286
Total
Floating
Rate
Loan
Interests
-
10.3%
(Cost:
$5,105,358)
..............................
5,108,979
Total
Long-Term
Investments
-
98.5%
(Cost:
$49,184,202)
..............................
48,962,420
Shares
Shares
Short-Term
Securities
-
6.4%
BlackRock
Liquidity
Funds,
T-Fund,
Institutional
Class,
0.01%
(
i
)(j)
..................
3,166,439
3,166,439
Total
Short-Term
Securities
-
6.4%
(Cost:
$3,166,439)
..............................
3,166,439
Total
Investments
-
104.9%
(Cost:
$52,350,641
)
..............................
52,128,859
Liabilities
in
Excess
of
Other
Assets
-
(4.9)%
............
(2,421,436)
Net
Assets
-
100.0%
..............................
$
49,707,423
(a)
Non-income
producing
security.
(b)
Security
exempt
from
registration
pursuant
to
Rule
144A
under
the
Securities
Act
of
1933,
as
amended.
These
securities
may
be
resold
in
transactions
exempt
from
registration
to
qualified
institutional
investors.
(c)
U.S.
dollar
denominated
security
issued
by
foreign
domiciled
entity.
(d)
Step
coupon
security.
Coupon
rate
will
either
increase
(step-up
bond)
or
decrease
(step-down
bond)
at
regular
intervals
until
maturity.
Interest
rate
shown
reflects
the
rate
currently
in
effect.
(e)
Convertible
security.
(f)
Variable
rate
security.
Interest
rate
resets
periodically.
The
rate
shown
is
the
effective
interest
rate
as
of
period
end.
Security
description
also
includes
the
reference
rate
and
spread
if
published
and
available.
(g)
Represents
an
unsettled
loan
commitment
at
period
end.
Certain
details
associated
with
this
purchase
are
not
known
prior
to
the
settlement
date,
including
coupon
rate.
(h)
Security
is
valued
using
significant
unobservable
inputs
and
is
classified
as
Level
3
in
the
fair
value
hierarchy.
(i)
Annualized
7-day
yield
as
of
period
end.
(j)
Affiliate
of
the
Fund.
BlackRock
Sustainable
High
Yield
Bond
Fund
Schedule
of
Investments
13
Schedule
of
Investments
(continued)
September
30,
2021
(a)
Commencement
of
operations.
Affiliates
Investments
in
issuers
considered
to
be
affiliate(s)
of
the
Fund
during
the
period
ended
September
30,
2021
for
purposes
of
Section
2(a)(3)
of
the
Investment
Company
Act
of
1940,
as
amended,
were
as
follows:
Affiliated
Issuer
Value
at
07/22/21
(
a)
Purchases
at
Cost
Proceeds
from
Sale
Net
Realized
Gain
(Loss)
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
09/30/21
Shares
Held
at
09/30/21
Income
Capital
Gain
Distributions
from
Underlying
Funds
BlackRock
Liquidity
Funds,
T-Fund,
Institutional
Class
(b
)
..
$
-
$
3,166,439
$
-
$
-
$
-
$
3,166,439
3,166,439
$
34
$
-
-
-
(b)
Represents
net
amount
purchased
(sold).
2021
BlackRock
Annual
Report
To
Shareholders
BlackRock
Sustainable
High
Yield
Bond
Portfolio
14
Schedule
of
Investments
(continued)
September
30,
2021
Derivative
Financial
Instruments
Categorized
by
Risk
Exposure
For
more
information
about
the
Fund's
investment
risks
regarding
derivative
financial
instruments,
refer
to
the
Notes
to
Financial
Statements.
See
notes
to
financial
statements.
For
the
period
ended
September
30,
2021,
the
effect
of
derivative
financial
instruments
in
the
Statement
of
Operations
was
as
follows:
Commodity
Contracts
Credit
Contracts
Equity
Contracts
Foreign
Currency
Exchange
Contracts
Interest
Rate
Contracts
Other
Contracts
Total
Net
Realized
Gain
(Loss)
from:
Futures
contracts
.......................
$
-
$
-
$
(16,571)
$
-
$
-
$
-
$
(16,571)
Average
Quarterly
Balances
of
Outstanding
Derivative
Financial
Instruments
Futures
contracts:
Average
notional
value
of
contracts
-
short
.............................................................................
$
-
(a)
(a)
Derivative
financial
instrument
not
held
at
any
quarter-end.
The
risk
exposure
table
serves
as
an
indicator
of
activity
during
the
period.
Fair
Value
Hierarchy
as
of
Period
End
Various
inputs
are
used
in
determining
the
fair
value
of
financial
instruments.
For
a
description
of
the
input
levels
and
information
about
the
Fund's
policy
regarding
valuation
of
financial
instruments,
refer
to
the
Notes
to
Financial
Statements.
The
following
table
summarizes
the
Fund's
financial
instruments
categorized
in
the
fair
value
hierarchy.
The
breakdown
of
the
Fund's
financial
instruments
into
major
categories
is
disclosed
in
the
Schedule
of
Investments
above.
Level
1
Level
2
Level
3
Total
Assets:
Investments:
Long-Term
Investments:
Common
Stocks
.........................................
$
680,108
$
-
$
-
$
680,108
Corporate
Bonds
........................................
-
43,173,333
-
43,173,333
Floating
Rate
Loan
Interests:
Auto
Components
......................................
-
186,420
-
186,420
Chemicals
............................................
-
76,238
-
76,238
Commercial
Services
&
Supplies
.............................
-
124,842
-
124,842
Construction
&
Engineering
................................
-
100,958
-
100,958
Construction
Materials
....................................
-
115,062
-
115,062
Diversified
Financial
Services
...............................
-
250,044
-
250,044
Diversified
Telecommunication
Services
........................
-
949,371
-
949,371
Health
Care
Providers
&
Services
............................
-
149,813
-
149,813
Health
Care
Technology
..................................
-
350,290
-
350,290
Hotels,
Restaurants
&
Leisure
..............................
-
299,454
-
299,454
Household
Durables
.....................................
-
64,472
-
64,472
Insurance
............................................
-
448,958
-
448,958
Interactive
Media
&
Services
...............................
-
149,951
-
149,951
IT
Services
...........................................
-
130,667
-
130,667
Machinery
............................................
-
99,833
-
99,833
Media
...............................................
-
542,126
-
542,126
Pharmaceuticals
.......................................
-
75,946
-
75,946
Professional
Services
....................................
-
99,624
-
99,624
Road
&
Rail
...........................................
-
99,655
-
99,655
Software
.............................................
-
497,889
97,080
594,969
Specialty
Retail
........................................
-
200,286
-
200,286
Short-Term
Securities
.......................................
3,166,439
-
-
3,166,439
$
3,846,547
$
48,185,232
$
97,080
$
52,128,859
Statement
of
Assets
and
Liabilities

September
30,
2021
15
Financial
Statements
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
ASSETS
Investments,
at
value
-
unaffiliated
(a)
........................................................................................
$
48,962,420‌
Investments,
at
value
-
affiliated
(b)
.........................................................................................
3,166,439‌
Cash
.............................................................................................................
24,085‌
Receivables:
-‌
Investments
sold
....................................................................................................
63,453‌
Dividends
-
affiliated
.................................................................................................
13‌
Dividends
-
unaffiliated
...............................................................................................
2,249‌
Interest
-
unaffiliated
.................................................................................................
493,599‌
From
the
Manager
...................................................................................................
34,472‌
Deferred
offering
costs
..................................................................................................
125,974‌
Prepaid
expenses
.....................................................................................................
1,306‌
Total
assets
.........................................................................................................
52,874,010‌
LIABILITIES
Payables:
-‌
Investments
purchased
................................................................................................
2,829,392‌
Income
dividend
distributions
............................................................................................
144,433‌
Offering
costs
......................................................................................................
86,999‌
Service
fees
.......................................................................................................
20‌
Other
accrued
expenses
...............................................................................................
105,743‌
Total
liabilities
........................................................................................................
3,166,587‌
NET
ASSETS
........................................................................................................
$
49,707,423‌
NET
ASSETS
CONSIST
OF
Paid-in
capital
........................................................................................................
$
49,990,130‌
Accumulated
loss
.....................................................................................................
(282,707‌)
NET
ASSETS
........................................................................................................
$
49,707,423‌
(a)
Investments,
at
cost
-
unaffiliated
........................................................................................
$
49,184,202‌
(b)
Investments,
at
cost
-
affiliated
..........................................................................................
$
3,166,439‌
Statement
of
Assets
and
Liabilities
(continued)
September
30,
2021
2021
BlackRock
Annual
Report
to
Shareholders
16
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
NET
ASSET
VALUE
Institutional
Net
assets
........................................................................................................
$
99,414‌
Shares
outstanding
.................................................................................................
10,000‌
Net
asset
value
....................................................................................................
$
9.94‌
Shares
authorized
..................................................................................................
Unlimited
Par
value
........................................................................................................
$
0.001‌
Investor
A
Net
assets
........................................................................................................
$
99,413‌
Shares
outstanding
.................................................................................................
10,000‌
Net
asset
value
....................................................................................................
$
9.94‌
Shares
authorized
..................................................................................................
Unlimited
Par
value
........................................................................................................
$
0.001‌
Class
K
Net
assets
........................................................................................................
$
49,508,596‌
Shares
outstanding
.................................................................................................
4,980,000‌
Net
asset
value
....................................................................................................
$
9.94‌
Shares
authorized
..................................................................................................
Unlimited
Par
value
........................................................................................................
$
0.001‌
Statement
of
Operations

Period
Ended
September
30,
2021
17
Financial
Statements
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
(a)
INVESTMENT
INCOME
Dividends
-
affiliated
.................................................................................................
$
34‌
Dividends
-
unaffiliated
...............................................................................................
2,852‌
Interest
-
unaffiliated
................................................................................................
320,489‌
Total
investment
income
.................................................................................................
323,375‌
EXPENSES
Professional
.......................................................................................................
93,049‌
Investment
advisory
..................................................................................................
47,863‌
Organization
and
o
ffering
..............................................................................................
35,488‌
Accounting
services
..................................................................................................
8,649‌
Administration
.....................................................................................................
4,068‌
Custodian
.........................................................................................................
2,877‌
Administration
-
class
specific
..........................................................................................
1,914‌
Transfer
agent
-
class
specific
..........................................................................................
210‌
Trustees
and
Officer
..................................................................................................
96‌
Service
-
class
specific
...............................................................................................
48‌
Miscellaneous
......................................................................................................
958‌
Total
expenses
.......................................................................................................
195,220‌
Less:
-‌
Administration
fees
waived
.............................................................................................
(4,068‌)
Administration
fees
waived
-
class
specific
..................................................................................
(1,914‌)
Fees
waived
and/or
reimbursed
by
the
Manager
...............................................................................
(138,245‌)
Transfer
agent
fees
waived
and/or
reimbursed
-
class
specific
.....................................................................
(191‌)
Total
expenses
after
fees
waived
and/or
reimbursed
..............................................................................
50,802‌
Net
investment
income
..................................................................................................
272,573‌
REALIZED
AND
UNREALIZED
GAIN
(LOSS)
$
(252,754‌)
Net
realized
loss
from:
$
-‌
Investments
-
unaffiliated
...........................................................................................
(14,401‌)
Futures
contracts
..................................................................................................
(16,571‌)
A
(30,972‌)
Net
change
in
unrealized
depreciation
on
investments
...........................................................................
(221,782‌)
Net
realized
and
unrealized
loss
............................................................................................
(252,754‌)
NET
INCREASE
IN
NET
ASSETS
RESULTING
FROM
OPERATIONS
..................................................................
$
19,819‌
(a)
Period
from
07/22/21
(commencement
of
operations)
to
09/30/21.
Statement
of
Changes
in
Net
Assets

2021
BlackRock
Annual
Report
to
Shareholders
18
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
Period
from
07/22/21
(a)
to
09/30/21
INCREASE
(DECREASE)
IN
NET
ASSETS
OPERATIONS
Net
investment
income
...............................................................................................
$
272,573‌
Net
realized
loss
...................................................................................................
(30,972‌)
Net
change
in
unrealized
appreciation
(depreciation)
...........................................................................
(221,782‌)
Net
increase
in
net
assets
resulting
from
operations
..............................................................................
19,819‌
DISTRIBUTIONS
TO
SHAREHOLDERS
(b)
Institutional
.....................................................................................................
(615‌)
Investor
A
......................................................................................................
(571‌)
Class
K
........................................................................................................
(311,210‌)
Decrease
in
net
assets
resulting
from
distributions
to
shareholders
....................................................................
(312,396‌)
CAPITAL
SHARE
TRANSACTIONS
Net
increase
in
net
assets
derived
from
capital
share
transactions
....................................................................
50,000,000‌
NET
ASSETS
Total
increase
in
net
assets
..............................................................................................
49,707,423‌
Beginning
of
period
...................................................................................................
-‌
End
of
period
.......................................................................................................
$
49,707,423‌
(a)
Commencement
of
operations.
(b)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
Financial
Highlights
(For
a
share
outstanding
throughout
the
period)
19
Financial
Highlights
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
Institutional
Period
from
07/22/21
(a)
to
09/30/21
Net
asset
value,
beginning
of
period
........................................................................................
$
10.00‌
Net
investment
income
(b)
................................................................................................
0.05‌
Net
realized
and
unrealized
loss
...........................................................................................
(0.05‌)
Net
increase
from
investment
operations
.......................................................................................
0.00‌
Distributions
from
net
investment
income
(c)
...................................................................................
(0.06‌)
Net
asset
value,
end
of
period
.............................................................................................
$
9.94‌
Total
Return
(d)
0.01%
Based
on
net
asset
value
.................................................................................................
0.01%
(e)
Ratios
to
Average
Net
Assets
Total
expenses
........................................................................................................
1.32%
(f)(g)(h)
Total
expenses
after
fees
waived
and/or
reimbursed
...............................................................................
0.58%
(f)(g)
Net
investment
income
..................................................................................................
2.80%
(f)(g)
Supplemental
Data
Net
assets,
end
of
period
(000)
.............................................................................................
$
99‌
Portfolio
turnover
rate
...................................................................................................
10%
(a)
Commencement
of
operations.
(b)
Based
on
average
shares
outstanding.
(c)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
(d)
Where
applicable,
assumes
the
reinvestment
of
distributions.
(e)
Aggregate
total
return.
(f)
Annualized.
(g)
Excludes
expenses
incurred
indirectly
as
a
result
of
investments
in
underlying
funds
of
0.01%.
(h)
Audit,
offering
and
organization
costs
were
not
annualized
in
the
calculation
of
the
expense
ratios.
If
these
expenses
were
annualized,
the
total
expenses
would
have
been
2.40%.
Financial
Highlights
(continued)
(For
a
share
outstanding
throughout
the
period)
2021
BlackRock
Annual
Report
to
Shareholders
20
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
Investor
A
Period
from
07/22/21
(a)
to
09/30/21
Net
asset
value,
beginning
of
period
........................................................................................
$
10.00‌
Net
investment
income
(b)
................................................................................................
0.05‌
Net
realized
and
unrealized
loss
...........................................................................................
(0.05‌)
Net
increase
from
investment
operations
.......................................................................................
(0.00‌)
Distributions
from
net
investment
income
(c)
...................................................................................
(0.06‌)
Net
asset
value,
end
of
period
.............................................................................................
$
9.94‌
Total
Return
(d)
(0.03)%
Based
on
net
asset
value
.................................................................................................
(0.03)%
(e)
Ratios
to
Average
Net
Assets
Total
expenses
........................................................................................................
1.58%
(f)(g)(h)
Total
expenses
after
fees
waived
and/or
reimbursed
...............................................................................
0.83%
(f)(g)
Net
investment
income
..................................................................................................
2.55%
(f)(g)
Supplemental
Data
Net
assets,
end
of
period
(000)
.............................................................................................
$
99‌
Portfolio
turnover
rate
...................................................................................................
10%
(a)
Commencement
of
operations.
(b)
Based
on
average
shares
outstanding.
(c)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
(d)
Where
applicable,
excludes
the
effects
of
any
sales
charges
and
assumes
the
reinvestment
of
distributions.
(e)
Aggregate
total
return.
(f)
Annualized.
(g)
Excludes
expenses
incurred
indirectly
as
a
result
of
investments
in
underlying
funds
of
0.01%.
(h)
Audit,
offering
and
organization
costs
were
not
annualized
in
the
calculation
of
the
expense
ratios.
If
these
expenses
were
annualized,
the
total
expenses
would
have
been
2.65%.
Financial
Highlights
(continued)
(For
a
share
outstanding
throughout
the
period)
21
Financial
Highlights
See
notes
to
financial
statements.
BlackRock
Sustainable
High
Yield
Bond
Fund
Class
K
Period
from
07/22/21
(a)
to
09/30/21
Net
asset
value,
beginning
of
period
........................................................................................
$
10.00‌
Net
investment
income
(b)
................................................................................................
0.05‌
Net
realized
and
unrealized
loss
...........................................................................................
(0.05‌)
Net
increase
from
investment
operations
.......................................................................................
0.00‌
Distributions
from
net
investment
income
(c)
...................................................................................
(0.06‌)
Net
asset
value,
end
of
period
.............................................................................................
$
9.94‌
Total
Return
(d)
0.02%
Based
on
net
asset
value
.................................................................................................
0.02%
(e)
Ratios
to
Average
Net
Assets
Total
expenses
........................................................................................................
0.96%
(f)(g)(h)
Total
expenses
after
fees
waived
and/or
reimbursed
...............................................................................
0.53%
(f)(g)
Net
investment
income
..................................................................................................
2.85%
(f)(g)
Supplemental
Data
Net
assets,
end
of
period
(000)
.............................................................................................
$
49,509‌
Portfolio
turnover
rate
...................................................................................................
10%
(a)
Commencement
of
operations.
(b)
Based
on
average
shares
outstanding.
(c)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
(d)
Where
applicable,
assumes
the
reinvestment
of
distributions.
(e)
Aggregate
total
return.
(f)
Annualized.
(g)
Excludes
expenses
incurred
indirectly
as
a
result
of
investments
in
underlying
funds
of
0.01%.
(h)
Audit,
offering
and
organization
costs
were
not
annualized
in
the
calculation
of
the
expense
ratios.
If
these
expenses
were
annualized,
the
total
expenses
would
have
been
2.04%.
Notes
to
Financial
Statements
2021
BlackRock
Annual
Report
to
Shareholders
22
1.
ORGANIZATION
BlackRock
Funds
V
(the
"Trust")
is
registered
under
the
Investment
Company
Act
of
1940,
as
amended
(the
"1940
Act"),
as
an
open-end
management
investment
company.
The
Trust
is
organized
as
a
Massachusetts
business
trust.
BlackRock
Sustainable
High
Yield
Bond
Fund
(the
"Fund")
is
a
series
of
the
Trust.
The
Fund
is
classified
as
diversified.
The
Fund
offers
multiple
classes
of
shares.
All
classes
of
shares
have
identical
voting,
dividend,
liquidation
and
other
rights
and
are
subject
to
the
same
terms
and
conditions,
except
that
certain
classes
bear
expenses
related
to
the
shareholder
servicing
and
distribution
of
such
shares.
Institutional
and
Class
K
Shares
are
sold
without
a
sales
charge
and
only
to
certain
eligible
investors.
Investor
A
Shares
bear
certain
expenses
related
to
shareholder
servicing
of
such
shares.
Investor
A
Shares
are
generally
available
through
financial
intermediaries.
Each
class
has
exclusive
voting
rights
with
respect
to
matters
relating
to
its
shareholder
servicing
and
distribution
expenditures.
(a)
Investor
A
Shares
may
be
subject
to
a
CDSC
for
certain
redemptions
where
no
initial
sales
charge
was
paid
at
the
time
of
purchase.
The
Fund,
together
with
certain
other
registered
investment
companies
advised
by
BlackRock
Advisors,
LLC
(the
"Manager") or
its
affiliates,
is
included
in
a
complex
of
non-
index
fixed-income
mutual
funds
and
all
BlackRock-advised
closed-end
funds
referred
to
as
the
BlackRock
Fixed-Income
Complex.
2.
SIGNIFICANT
ACCOUNTING
POLICIES
The
financial
statements
are
prepared
in
conformity
with
accounting
principles
generally
accepted
in
the
United
States
of
America
("U.S.
GAAP"),
which
may
require
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities
in
the
financial
statements,
disclosure
of
contingent
assets
and
liabilities
at
the
date
of
the
financial
statements
and
the
reported
amounts
of
increases
and
decreases
in
net
assets
from
operations
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
The
Fund
is
considered
an
investment
company
under
U.S.
GAAP
and
follows
the
accounting
and
reporting
guidance
applicable
to
investment
companies.
Below
is
a
summary
of
significant
accounting
policies:
Investment
Transactions
and
Income
Recognition:
For
financial
reporting
purposes,
investment
transactions
are
recorded
on
the
dates
the
transactions
are
executed.
Realized
gains
and
losses
on
investment
transactions
are
determined
using
the
specific
identification
method.
Dividend
income
and
capital
gain
distributions,
if
any,
are
recorded
on
the
ex-dividend
dates.
Non-cash
dividends,
if
any,
are
recorded
on
the
ex-dividend
dates
at
fair
value.
Interest
income,
including
amortization
and
accretion
of
premiums
and
discounts
on
debt
securities,
is
recognized
daily
on
an
accrual
basis.
Income,
expenses
and
realized
and
unrealized
gains
and
losses
are
allocated
daily
to
each
class
based
on
its
relative
net
assets.
For
convertible
securities,
premiums
attributable
to
the
debt
instrument
are
amortized,
but
premiums
attributable
to
the
conversion
feature
are
not
amortized.
Segregation
and
Collateralization:
In
cases
where
the
Fund
enters
into
certain
investments
(e.g.,
futures
contracts)
that
would
be
treated
as
"senior
securities"
for
1940
Act
purposes,
the
Fund
may
segregate
or
designate
on
its
books
and
records
cash
or
liquid
assets
having
a
market
value
at
least
equal
to
the
amount
of
its
future
obligations
under
such
investments.
Doing
so
allows
the
investments
to
be
excluded
from
treatment
as
a
"senior
security."
Furthermore,
if
required
by
an
exchange
or
counterparty
agreement,
the
Fund
may
be
required
to
deliver/deposit
cash
and/or
securities
to/with
an
exchange,
or
broker-dealer
or
custodian
as
collateral
for
certain
investments
or
obligations.
Distributions:
Distributions
from
net
investment
income
are
declared
daily
and
paid
monthly.
Distributions
of
capital
gains
are
recorded
on
the
ex-dividend
dates
and
made
at
least
annually.
The
character
and
timing
of
distributions
are
determined
in
accordance
with
U.S.
federal
income
tax
regulations,
which
may
differ
from
U.S.
GAAP
.
Deferred
Compensation
Plan:
Under
the
Deferred
Compensation
Plan
(the
"Plan")
approved
by
the
Board
of
Trustees
of
the
Trust
(the
"Board"), the trustees
who
are
not
"interested
persons"
of
the
Fund,
as
defined
in
the
1940
Act
("Independent
Trustees"),
may
defer
a
portion
of
their
annual
complex-wide
compensation.
Deferred
amounts
earn
an
approximate
return
as
though
equivalent
dollar
amounts
had
been
invested
in
common
shares
of
certain
funds
in
the
BlackRock
Fixed-Income
Complex
selected
by
the
Independent
Trustees
.
This
has
the
same
economic
effect
for
the
Independent
Trustees
as
if
the
Independent
Trustees
had
invested
the
deferred
amounts
directly
in
certain
funds
in
the
BlackRock
Fixed-Income
Complex.
The
Plan
is
not
funded
and
obligations
thereunder
represent
general
unsecured
claims
against
the
general
assets
of
the
Fund,
as
applicable.
Deferred
compensation
liabilities,
if
any, are
included
in
the
Trustees'
and
Officer's
fees
payable
in
the
Statement
of
Assets
and
Liabilities
and
will
remain
as
a
liability
of
the
Fund
until
such
amounts
are
distributed
in
accordance
with
the
Plan.
Organization
and
Offering
Costs:
Upon
commencement
of
operations,
organization
costs
associated
with
the
establishment
of
the
Fund
were
expensed
by
the
Fund
and
reimbursed
by
the
Manager.
The
Manager
reimbursed
the
Fund
$10,000,
which
is
included
in
fees
waived
and/or
reimbursed
by
the
Manager
in
the
Statement
of
Operations.
Offering
costs
are
amortized
over
a
12-month
period
beginning
with
the
commencement
of
operations
of
a
class
of
shares.
Indemnifications:
In
the
normal
course
of
business,
the
Fund
enters
into
contracts
that
contain
a
variety
of
representations
that
provide
general
indemnification.
The
Fund's
maximum
exposure
under
these
arrangements
is
unknown
because
it
involves
future
potential
claims
against
the
Fund,
which
cannot
be
predicted
with
any
certainty.
Other:
Expenses
directly
related
to the
Fund
or
its
classes
are
charged
to
the
Fund
or
the
applicable
class.
Expenses
directly
related
to
the
Fund
and
other
shared
expenses
prorated
to
the
Fund
are
allocated
daily
to
each
class
based
on
its
relative
net
assets
or
other
appropriate
methods.
Other
operating
expenses
shared
by
several
funds,
including
other
funds
managed
by
the
Manager
,
are
prorated
among
those
funds
on
the
basis
of
relative
net
assets
or
other
appropriate
methods.
Share
Class
Initial
Sales
Charge
Contingent
Deferred
Sales
Charge
("CDSC")
Conversion
Privilege
Institutional
and
Class
K
Shares
.....................................
No
No
None
Investor
A
Shares
..............................................
Yes
Yes
(a)
None
Notes
to
Financial
Statements
(continued)
23
Notes
to
Financial
Statements
3.
INVESTMENT
VALUATION
AND
FAIR
VALUE
MEASUREMENTS
Investment
Valuation
Policies:
The
Fund's
investments
are
valued
at
fair
value
(also
referred
to
as
"market
value"
within
the
financial
statements)
each
day
that
the
Fund
is
open
for
business
and,
for
financial
reporting
purposes,
as
of
the
report
date.
U.S.
GAAP
defines
fair
value
as
the
price
a
fund
would
receive
to
sell
an
asset
or
pay
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
at
the
measurement
date.
The
Fund
determines
the
fair
values
of
its
financial
instruments
using
various
independent
dealers
or
pricing
services
under
policies
approved
by
the
Board.
If
a
security's
market
price
is
not
readily
available
or
does
not
otherwise
accurately
represent
the
fair
value
of
the
security,
the
security
will
be
valued
in
accordance
with
a
policy
approved
by
the
Board
as
reflecting
fair
value.
The
BlackRock
Global
Valuation
Methodologies
Committee
(the
"Global
Valuation
Committee")
is
the
committee
formed
by
management
to
develop
global
pricing
policies
and
procedures
and
to
oversee
the
pricing
function
for
all
financial
instruments.
Fair
Value
Inputs
and
Methodologies:
The
following
methods
and
inputs
are
used
to
establish
the
fair
value
of
the
Fund's
assets
and
liabilities:
Equity
investments
traded
on
a
recognized
securities
exchange
are
valued
at
that
day's official
closing
price,
as
applicable,
on
the
exchange
where
the
stock
is
primarily
traded.
Equity
investments
traded
on
a
recognized
exchange
for
which
there
were
no
sales
on
that
day
may
be
valued
at
the
last
available
bid
(long
positions)
or
ask
(short
positions)
price.
Fixed-income investments
for
which
market
quotations
are
readily
available
are
generally
valued
using
the
last
available
bid
price
or
current
market
quotations
provided
by
independent
dealers
or
third-party
pricing
services.
Floating
rate
loan
interests
are
valued
at
the
mean
of
the
bid
prices
from
one
or
more
independent
brokers
or
dealers
as
obtained
from
a
third-party
pricing
service.
Pricing
services
generally
value
fixed-income
securities
assuming
orderly
transactions
of
an
institutional
round
lot
size,
but
a
fund
may
hold
or
transact
in
such
securities
in
smaller,
odd
lot
sizes.
Odd
lots
may
trade
at
lower
prices
than
institutional
round
lots.
The
pricing
services
may
use
matrix
pricing
or
valuation
models
that
utilize
certain
inputs
and
assumptions
to
derive
values,
including
transaction
data
(e.g.,
recent
representative
bids
and
offers),
market
data, credit
quality
information,
perceived
market
movements,
news,
and
other
relevant
information.
Certain
fixed-income
securities,
including
asset-
backed
and
mortgage
related
securities
may
be
valued
based
on
valuation
models
that
consider
the
estimated
cash
flows
of
each
tranche
of
the
entity,
establish
a
benchmark
yield
and
develop
an
estimated
tranche
specific
spread
to
the
benchmark
yield
based
on
the
unique
attributes
of
the
tranche.
The
amortized
cost
method
of
valuation
may
be
used
with
respect
to
debt
obligations
with
sixty
days
or
less
remaining
to
maturity
unless
the
Manager
determines
such
method
does
not
represent
fair
value.
Investments
in
open-end
U.S.
mutual
funds
(including
money
market
funds) are
valued
at
that
day's
published net
asset
value
("NAV").
If
events
(e.g.,
market
volatility,
company
announcement or
a
natural
disaster)
occur
that
are
expected
to
materially
affect
the
value
of
such
investment,
or
in
the
event
that application
of
these
methods
of
valuation
results
in
a
price
for
an
investment
that
is
deemed
not
to
be
representative
of
the
market
value
of
such
investment,
or
if
a
price
is
not
available,
the
investment
will
be
valued
by
the
Global
Valuation
Committee,
or
its
delegate,
in
accordance
with
a
policy
approved
by
the
Board
as
reflecting
fair
value
("Fair
Valued
Investments").
The
fair
valuation
approaches
that
may
be
used
by
the
Global
Valuation
Committee include
market
approach,
income
approach
and
cost
approach.
Valuation
techniques
such
as
discounted
cash
flow,
use
of
market
comparables
and
matrix
pricing
are
types
of
valuation
approaches
and
are
typically
used
in
determining
fair
value.
When
determining
the
price
for
Fair
Valued
Investments,
the
Global
Valuation
Committee,
or
its
delegate,
seeks
to
determine
the
price
that
the
Fund
might
reasonably
expect
to
receive
or
pay
from
the
current
sale
or
purchase
of
that
asset
or
liability
in
an
arm's-length
transaction.
Fair
value
determinations
shall
be
based
upon
all
available
factors
that
the
Global
Valuation
Committee,
or
its
delegate,
deems
relevant
and
consistent
with
the
principles
of
fair
value
measurement.
The
pricing
of
all
Fair
Valued
Investments
is
subsequently
reported
to
the
Board
or
a
committee
thereof
on
a
quarterly
basis.
For
investments
in
equity
or
debt
issued
by
privately
held
companies
or
funds
("Private
Company"
or
collectively,
the
"Private
Companies")
and
other
Fair
Valued
Investments,
the
fair
valuation
approaches
that
are
used
by
the
Global
Valuation
Committee
and
third-party
pricing
services
utilize
one
or
a
combination
of,
but
not
limited
to,
the
following
inputs.
Investments
in
series
of
preferred
stock
issued
by
Private
Companies
are
typically
valued
utilizing
market
approach
in
determining
the
enterprise
value
of
the
company.
Such
investments
often
contain
rights
and
preferences
that
differ
from
other
series
of
preferred
and
common
stock
of
the
same
issuer.
Enterprise
valuation
techniques
such
as
an
option
pricing
model
("OPM"),
a
probability
weighted
expected
return
model
("PWERM"),
current
value
method or
a
hybrid
of
those
techniques
are
used
as
deemed
appropriate
under
the
circumstances.
The
use
of these
valuation techniques
involve
a
determination
of
the
exit
scenarios
of
the
investment
in
order
to
appropriately
allocate
the
enterprise
value
of
the
company
among
the
various
parts
of
its
capital
structure.
Standard
Inputs
Generally
Considered
By
Third-Party
Pricing
Services
Market
approach
........................
(i)
recent
market
transactions,
including
subsequent
rounds
of
financing,
in
the
underlying
investment
or
comparable
issuers;
(ii) recapitalizations
and
other
transactions
across
the
capital
structure;
and
(iii)
market
multiples
of
comparable
issuers.
Income
approach
..........................
(i)
future
cash
flows
discounted
to
present
and
adjusted
as
appropriate
for
liquidity,
credit,
and/or
market
risks;
(ii) quoted
prices
for
similar
investments
or
assets
in
active
markets;
and
(iii)
other
risk
factors,
such
as
interest
rates,
yield
curves,
volatilities,
prepayment
speeds,
loss
severities,
credit
risks,
recovery
rates,
liquidation
amounts
and/or
default
rates.
Cost
approach
............................
(i)
audited
or
unaudited
financial
statements,
investor
communications
and
financial
or
operational
metrics
issued
by
the
Private
Company;
(ii) changes
in
the
valuation
of
relevant
indices
or
publicly
traded
companies
comparable
to
the
Private
Company;
(iii)
relevant
news
and
other
public
sources;
and
(iv)
known
secondary
market
transactions
in
the
Private
Company's
interests
and
merger
or
acquisition
activity
in
companies
comparable
to
the
Private
Company.
Notes
to
Financial
Statements
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
24
The
Private
Companies
are
not
subject
to
the
public
company
disclosure,
timing,
and
reporting
standards
applicable
to other
investments
held
by the
Fund.
Typically,
the
most
recently
available
information
by
a
Private
Company
is
as
of
a
date
that
is
earlier
than
the
date the
Fund
is
calculating
its
NAV.
This
factor
may
result
in
a
difference
between
the
value
of
the
investment
and
the
price the
Fund
could
receive
upon
the
sale
of
the
investment.
Fair
Value
Hierarchy:
Various
inputs
are
used
in
determining
the
fair
value
of
financial
instruments.
These
inputs
to
valuation
techniques
are
categorized
into
a
fair
value
hierarchy
consisting
of
three
broad
levels
for
financial reporting purposes
as
follows:
Level
1
-
Unadjusted
price
quotations
in
active
markets/exchanges
for
identical
assets
or
liabilities
that
the
Fund
has
the
ability
to
access;
Level
2
-
Other
observable
inputs
(including,
but
not
limited
to,
quoted
prices
for
similar
assets
or
liabilities
in
markets
that
are
active,
quoted
prices
for
identical
or
similar
assets
or
liabilities
in
markets
that
are
not
active,
inputs
other
than
quoted
prices
that
are
observable
for
the
assets
or
liabilities
(such
as
interest
rates,
yield
curves,
volatilities,
prepayment
speeds,
loss
severities,
credit
risks
and
default
rates)
or
other
market-corroborated
inputs);
and
Level
3 -
Unobservable
inputs
based
on
the
best
information
available
in
the
circumstances,
to
the
extent
observable
inputs
are
not
available
(including
the
Global
Valuation
Committee's assumptions
used
in
determining
the
fair
value
of
financial
instruments).
The
hierarchy
gives
the
highest
priority
to
unadjusted
quoted
prices
in
active
markets
for
identical
assets
or
liabilities
(Level
1
measurements)
and
the
lowest
priority
to
unobservable
inputs
(Level
3
measurements).
Accordingly,
the
degree
of
judgment
exercised
in
determining
fair
value
is
greatest
for
instruments
categorized
in
Level
3.
The
inputs
used
to
measure
fair
value
may
fall
into
different
levels
of
the
fair
value
hierarchy.
In
such
cases,
for
disclosure
purposes,
the
fair
value
hierarchy
classification
is
determined
based
on
the
lowest
level
input
that
is
significant
to
the
fair
value
measurement
in
its
entirety. Investments
classified
within
Level
3
have
significant
unobservable
inputs
used
by
the
Global
Valuation
Committee
in
determining
the
price
for
Fair
Valued
Investments.
Level
3
investments
include
equity
or
debt
issued
by
privately
held
companies
or
funds
that
may
not
have
a
secondary
market
and/or
may
have
a
limited
number
of
investors.
The
categorization
of
a
value
determined
for
financial
instruments
is
based
on
the
pricing
transparency
of
the financial
instruments
and
is
not
necessarily
an
indication
of
the
risks
associated
with
investing
in
those
securities.
4.
SECURITIES
AND
OTHER
INVESTMENTS
Floating
Rate
Loan
Interests:
Floating
rate
loan
interests
are
typically
issued
to
companies
(the
"borrower")
by
banks,
other
financial
institutions,
or
privately
and
publicly
offered
corporations
(the
"lender").
Floating
rate
loan
interests
are
generally
non-investment
grade,
often
involve
borrowers
whose
financial
condition
is
troubled
or
uncertain
and
companies
that
are
highly
leveraged
or
in
bankruptcy
proceedings.
In
addition,
transactions
in
floating
rate
loan
interests
may
settle
on
a
delayed
basis,
which
may
result
in
proceeds
from
the
sale
not
being
readily
available
for
a
fund
to
make
additional
investments
or
meet
its
redemption
obligations.
Floating
rate
loan
interests
may
include
fully
funded
term
loans
or
revolving
lines
of
credit.
Floating
rate
loan
interests
are
typically
senior
in
the
corporate
capital
structure
of
the
borrower.
Floating
rate
loan
interests
generally
pay
interest
at
rates
that
are
periodically
determined
by
reference
to
a
base
lending
rate
plus
a
premium.
Since
the
rates
reset
only
periodically,
changes
in
prevailing
interest
rates
(and
particularly
sudden
and
significant
changes)
can
be
expected
to
cause
some
fluctuations
in
the
NAV
of
a
fund
to
the
extent
that
it
invests
in
floating
rate
loan
interests.
The
base
lending
rates
are
generally
the
lending
rate
offered
by
one
or
more
European
banks,
such
as
the
London
Interbank
Offered
Rate
("LIBOR"),
the
prime
rate
offered
by
one
or
more
U.S.
banks
or
the
certificate
of
deposit
rate.
Floating
rate
loan
interests
may
involve
foreign
borrowers,
and
investments
may
be
denominated
in
foreign
currencies.
These
investments
are
treated
as
investments
in
debt
securities
for
purposes
of
a
fund's
investment
policies.
When
a
fund
purchases
a
floating
rate
loan
interest,
it
may
receive
a
facility
fee
and
when
it
sells
a
floating
rate
loan
interest,
it
may
pay
a
facility
fee.
On
an
ongoing
basis,
a
fund
may
receive
a
commitment
fee
based
on
the
undrawn
portion
of
the
underlying
line
of
credit
amount
of
a
floating
rate
loan
interest.
Facility
and
commitment
fees
are
typically
amortized
to
income
over
the
term
of
the
loan
or
term
of
the
commitment,
respectively.
Consent
and
amendment
fees
are
recorded
to
income
as
earned.
Prepayment
penalty
fees,
which
may
be
received
by
a
fund
upon
the
prepayment
of
a
floating
rate
loan
interest
by
a
borrower,
are
recorded
as
realized
gains.
A
fund
may
invest
in
multiple
series
or
tranches
of
a
loan.
A
different
series
or
tranche
may
have
varying
terms
and
carry
different
associated
risks.
Floating
rate
loan
interests
are
usually
freely
callable
at
the
borrower's
option.
A
fund
may
invest
in
such
loans
in
the
form
of
participations
in
loans
("Participations")
or
assignments
("Assignments")
of
all
or
a
portion
of
loans
from
third
parties.
Participations
typically
will
result
in
a
fund
having
a
contractual
relationship
only
with
the
lender,
not
with
the
borrower.
A
fund
has
the
right
to
receive
payments
of
principal,
interest
and
any
fees
to
which
it
is
entitled
only
from
the
lender
selling
the
Participation
and
only
upon
receipt
by
the
lender
of
the
payments
from
the
borrower.
In
connection
with
purchasing
Participations,
a
fund
generally
will
have
no
right
to
enforce
compliance
by
the
borrower
with
the
terms
of
the
loan
agreement,
nor
any
rights
of
offset
against
the
borrower.
A
fund
may
not
benefit
directly
from
any
collateral
supporting
the
loan
in
which
it
has
purchased
the
Participation.
As
a
result,
a
fund
assumes
the
credit
risk
of
both
the
borrower
and
the
lender
that
is
selling
the
Participation.
A
fund's
investment
in
loan
participation
interests
involves
the
risk
of
insolvency
of
the
financial
intermediaries
who
are
parties
to
the
transactions.
In
the
event
of
the
insolvency
of
the
lender
selling
the
Participation,
a
fund
may
be
treated
as
a
general
creditor
of
the
lender
and
may
not
benefit
from
any
offset
between
the
lender
and
the
borrower.
Assignments
typically
result
in
a
fund
having
a
direct
contractual
relationship
with
the
borrower,
and
a
fund
may
enforce
compliance
by
the
borrower
with
the
terms
of
the
loan
agreement.
5.
Derivative
Financial
Instruments
The
Fund
engages
in
various
portfolio
investment
strategies
using
derivative
contracts
both
to
increase
the
returns
of
the
Fund
and/or
to
manage
its
exposure
to
certain
risks
such
as
credit
risk,
equity
risk,
interest
rate
risk,
foreign
currency
exchange
rate
risk,
commodity
price
risk
or
other
risks
(e.g.,
inflation
risk).
Derivative
financial
instruments
categorized
by
risk
exposure
are
included
in
the
Schedule
of
Investments.
These
contracts
may
be
transacted
on
an
exchange or
over-the-counter
("OTC").
Futures
Contracts:
Futures
contracts
are
purchased
or
sold
to
gain
exposure
to,
or
manage
exposure
to,
changes
in
interest
rates
(interest
rate
risk)
and
changes
in
the
value
of
equity
securities
(equity
risk)
or,
foreign
currencies
(foreign
currency
exchange
rate
risk).
Futures
contracts
are
exchange-traded agreements
between
the
Fund
and
a
counterparty
to
buy
or
sell
a
specific
quantity
of
an
underlying
instrument
at
a
specified
price
and
on
a
specified
date.
Depending
on
the
terms
of
a
contract,
it
is
settled
either
through
physical
delivery
of
the
underlying
instrument
on
the
settlement
date
or
by
payment
of
a
cash
amount
on
the
settlement
date.
Upon
entering
into
a
futures
contract,
the
Fund
is
required
to
deposit
initial
margin
with
the
broker
in
the
form
of
cash
or
securities
in
Notes
to
Financial
Statements
(continued)
25
Notes
to
Financial
Statements
an
amount
that
varies
depending
on
a
contract's
size
and
risk
profile.
The
initial
margin
deposit
must
then
be
maintained
at
an
established
level
over
the
life
of
the
contract.
Amounts
pledged,
which
are
considered
restricted,
are
included
in
cash
pledged
for
futures
contracts
in
the Statement
of
Assets
and
Liabilities.
Securities
deposited
as
initial
margin
are
designated
in
the
Schedule
of
Investments
and
cash
deposited,
if
any, are
shown
as
cash
pledged
for
futures
contracts
in
the
Statement
of
Assets
and
Liabilities.
Pursuant
to
the
contract,
the
Fund
agrees
to
receive
from
or
pay
to
the
broker
an
amount
of
cash
equal
to
the
daily
fluctuation
in
market
value
of
the
contract
("variation
margin").
Variation
margin
is
recorded
as
unrealized
appreciation
(depreciation)
and,
if
any,
shown
as
variation
margin
receivable
(or
payable)
on
futures
contracts
in
the
Statement
of
Assets
and
Liabilities.
When
the
contract
is
closed,
a
realized
gain
or
loss
is
recorded
in
the
Statement
of
Operations
equal
to
the
difference
between
the
notional
amount
of
the
contract
at
the
time
it
was
opened
and
the
notional
amount
at
the
time
it
was
closed.
The
use
of
futures
contracts
involves
the
risk
of
an
imperfect
correlation
in
the
movements
in
the
price
of
futures
contracts
and
interest
rates,
foreign
currency
exchange
rates
or
underlying
assets.
6.
INVESTMENT
ADVISORY
AGREEMENT
AND
OTHER
TRANSACTIONS
WITH
AFFILIATES
Investment
Advisory:
The
Trust,
on
behalf
of
the
Fund,
entered
into
an
Investment
Advisory
Agreement
with
the
Manager,
the
Fund's
investment
adviser
and
an
indirect,
wholly-owned
subsidiary
of
BlackRock,
Inc.
("BlackRock")
,
to
provide
investment
advisory
and
administrative
services.
The
Manager
is
responsible
for
the
management
of the
Fund's
portfolio
and
provides
the
personnel,
facilities,
equipment
and
certain
other
services
necessary
to
the
operations
of the
Fund.
For
such
services,
the
Fund
pays
the
Manager
a
monthly
fee
at
an
annual
rate
equal
to
the
following
percentages
of
the
average
daily
value
of
the
Fund's
net
assets:
The
Manager
entered
into
a
sub-advisory
agreement
with
BlackRock
International
Limited
("BIL")
an
affiliate
of
the
Manager.
The
Manager
pays
BIL
for
services
it
provides
for
that
portion
of
the
Fund
for
which
BIL
acts
as
sub-adviser,
a
monthly
fee
that
is
equal
to
a
percentage
of
the
investment
advisory
fees
paid
by
the
Fund
to
the
Manager.
Service
and
Distribution
Fees:
The
Trust
,
on behalf
of
the
Fund,
entered
into
a
Distribution
Agreement
and
a Distribution and
Service
Plan
with
BlackRock
Investments,
LLC
("BRIL"),
an
affiliate
of
the
Manager.
Pursuant
to
the
Distribution
and
Service
Plan
and
in
accordance
with
Rule
12b-1
under
the
1940
Act,
the
Fund
pays
BRIL
ongoing
service
fees.
The
fees
are
accrued
daily
and
paid
monthly
at
annual
rates
based
upon
the
average
daily
net
assets
of
the
relevant
share
class
of
the
Fund
as
follows:
BRIL
and
broker-dealers,
pursuant
to
sub-agreements
with
BRIL,
provide
shareholder
servicing to
the
Fund.
The
ongoing
service
fee compensates
BRIL
and
each
broker-
dealer
for
providing
shareholder
servicing
related
services
to
shareholders.
For
the period
ended
September
30,
2021,
the
following
table
shows
the
class
specific
service
fees
borne
directly
by
each
share
class
of
the
Fund:
Administration:
The
Trust,
on
behalf
of
the
Fund,
entered
into
an
Administration
Agreement
with
the
Manager,
an
indirect
,
wholly-owned
subsidiary
of
BlackRock,
to
provide
administrative
services.
For
these
services,
the
Manager
receives
an
administration
fee
computed
daily
and
payable
monthly,
based
on
a
percentage
of
the
average
daily
net
assets
of
the
Fund.
The
administration
fee,
which
is
shown
as
administration
in
the
Statement
of
Operations,
is
paid
at
the
annual
rates
below.
In
addition,
the
Manager
charges
each
of
the
share
classes
an
administration
fee,
which
is
shown
as
administration -
class
specific
in
the
Statement
of
Operations,
at
an
annual
rate
of
0.02% of
the
average
daily
net
assets
of
each
respective
class.
For
the
period
ended
September
30,
2021, the
following
table
shows
the
class
specific
administration
fees
borne
directly
by
each
share
class
of
the
Fund:
Transfer
Agent:
Pursuant
to
written
agreements,
certain
financial
intermediaries,
some
of
which
may
be
affiliates,
provide
the
Fund
with
sub-accounting,
recordkeeping,
sub-transfer
agency
and
other
administrative
services
with
respect
to
servicing
of
underlying
investor
accounts.
For
these
services,
these
entities
receive
an
asset-based
fee
Average
Daily
Net
Assets
Investment
Advisory
Fees
First
$1
Billion
.........................................................................................................
0.500
%
$1
Billion
-
$3
Billion
.....................................................................................................
0.470
$3
Billion
-
$5
Billion
....................................................................................................
0.450
$5
Billion
-
$10
Billion
....................................................................................................
0.440
Greater
than
$10
Billion
..................................................................................................
0.430
Service
Fees
Investor
A
..............................................................................................................
0.25‌%
Service
Fees
Investor
A
........................................................................................................
$
48‌
Average
Daily
Net
Assets
Administration
Fees
First
$500
Million
0.0425
%
$500
Million
-
$1
Billion
0.0400
$1
Billion
-
$2
Billion
0.0375
$2
Billion
-
$4
Billion
0.0350
$4
Billion
-
$13
Billion
0.0325
Greater
than
$13
Billion
0.0300
Institutional
.......................................................................................................
$
4‌
Investor
A
........................................................................................................
3‌
Class
K
.........................................................................................................
1,907‌
$
1,914‌
Notes
to
Financial
Statements
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
26
or
an
annual
fee
per
shareholder
account,
which
will
vary
depending
on
share
class
and/or
net
assets.
For
the
period ended September
30,
2021,
the
Fund
did
not
pay
any
amounts
to
affiliates
in
return
for
these
services.
The
Manager
maintains
a
call
center
that
is
responsible
for
providing
certain
shareholder
services
to
the
Fund.
Shareholder
services
include
responding
to
inquiries
and
processing
purchases
and
sales
based
upon
instructions
from
shareholders.
For
the
period
ended
September
30,
2021,
the
Fund
did
not
reimbursed
the
Manager
any
amounts
in
return
for
these
services.
For
the
period ended
September
30,
2021,
the
following
table
shows
the
class
specific
transfer
agent
fees
borne
directly
by
each
share
class
of
the
Fund:
Expense
Limitations,
Waivers,
Reimbursements
and
Recoupments:
The
Manager
contractually
agreed
to
waive
its
investment
advisory
fees
by
the
amount
of
investment
advisory
fees
the
Fund
pays
to
the
Manager
indirectly
through
its
investment
in
affiliated
money
market
funds
(the
"affiliated
money
market
fund
waiver")
through
June
30,
2023.
The
contractual
agreement
may
be
terminated upon
90
days'
notice
by
a
majority
of
the
Independent
Trustees,
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of
the
Fund.
The
amount
of
waivers
and/or
reimbursements
of
fees
and
expenses
made
pursuant
to
the
expense
limitations
described
below
will
be
reduced
by
the
amount
of
the
affiliated
money
market
fund
waiver. This
amount
is
included
in
fees
waived
and/or
reimbursed
by
the
Manager
in
the
Statement
o
f
Operations.
For
the
period
ended
September
30
,
2021,
the
amount
waived
was
$1
30
.
The
Manager
has
contractually
agreed
to
waive
its
investment
advisory
fee
with
respect
to
any
portion
of
the
Fund's
assets
invested
in
affiliated
equity
and
fixed-income mutual
funds
and
affiliated
exchange-traded
funds
that
have
a
contractual
management
fee
through
June
30,
2023.
The
contractual
agreement
may
be
terminated
upon
90
days'
notice
by
a
majority
of
the
Independent
Trustees,
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of
the
Fund.
This
amount
is
included
in
fees
waived
and/
or
reimbursed
by
the
Manager
in
the
Statement
of
Operations.
For
the
period
ended
September
30,
2021,
there
were
no
fees
waived
by
the
Manager
pursuant
to
this
arrangement.
The
Manager
contractually
agreed
to
waive
and/or
reimburse
fees
or
expenses
in
order
to
limit
expenses,
excluding
interest
expense,
dividend
expense,
tax
expense,
acquired
fund
fees
and
expenses,
and
certain
other
fund
expenses,
which
constitute
extraordinary
expenses
not
incurred
in
the
ordinary
course
of the
Fund's
business
("expense
limitation").
The
expense
limitations
as
a
percentage
of
average
daily
net
assets
are
as
follows:
The
Manager
has
agreed
not
to
reduce
or
discontinue
the
contractual
expense
limitations
through
June
30,
2023,
unless
approved
by
the
Board,
including
a
majority
of
Independent
Trustees,
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of the
Fund. For
the
period
ended
September
30,
2021,
the
Manager
waived
and/or
reimbursed
investment
advisory
fees
of
$128,115,
which
is
included
in
fees
waived
and/or
reimbursed
by
the
Manager,
in
the
Statement
of
Operations.
The
Fund
also
had
a
waiver
of
administration
fees,
which
is
included
in
Administration
fees
waived
in
the
Statement
of
Operations.
For
the
period
ended
September
30,
2021,
the
amount
was
$4,068.
In
addition,
these
amounts
waived
and/or
reimbursed
by
the
Manager are
included
in administration
fees
waived
-
class
specific
and
transfer
agent
fees
waived
and/or
reimbursed
-
class
specific,
respectively,
in
the
Statement
of
Operations.
For
the
period ended
September
30,
2021,
class
specific
expense
waivers
and/or
reimbursements are
as
follows:
With
respect
to
the
contractual
expense
limitation,
if
during
the
Fund's
fiscal
year
the
operating
expenses
of
a
share
class,
that
at
any
time
during
the
prior
two
fiscal
years
received
a
waiver
and/or
reimbursement
from
the
Manager,
are
less
than
the
current
expense
limitation
for
that
share
class,
the
Manager
is
entitled
to
be
reimbursed
by
such
share
class
up
to
the
lesser
of:
(a)
the
amount
of
fees
waived
and/or
expenses
reimbursed
during
those
prior
two
fiscal
years
under
the
agreement
and
(b)
an
amount
not
to
exceed
either
the
current
expense
limitation
of
that
share
class
or
the
expense
limitation
of
the
share
class
in
effect
at
the
time
that
the
share
class
received
the
applicable
waiver
and/or
reimbursement,
provided
that:
(1)
the
Fund,
of
which
the
share
class
is
a
part,
has
more
than
$50
million
in
assets
for
the
fiscal
year,
and
(2)
the
Manager
or
an
affiliate
continues
to
serve
as
the
Fund's
investment
adviser
or
administrator.
Institutional
.......................................................................................................
$
70‌
Investor
A
........................................................................................................
70‌
Class
K
.........................................................................................................
70‌
$
210‌
Institutional
..........................................................................................................
0.58‌%
Investor
A
...........................................................................................................
0.83‌
Class
K
............................................................................................................
0.53‌
Fund
Name/Share
Class
Administration
Fees
Waived
Transfer
Agent
Fees
Waived
and/or
Reimbursed
BlackRock
Sustainable
High
Yield
Bond
Fund
Institutional
....................................................................................
$
4‌
$
60‌
Investor
A
.....................................................................................
3‌
61‌
Class
K
......................................................................................
1,907‌
70‌
$
1,914‌
$
191‌
Notes
to
Financial
Statements
(continued)
27
Notes
to
Financial
Statements
This
repayment
applies
only
to
the
contractual
expense
limitation
on
net
expenses
and
does
not
apply
to
the
contractual
investment
advisory
fee
waiver
described
above
or
any
voluntary
waivers
that
may
be
in
effect
from
time
to
time.
Effective
July
22,
2028,
the
repayment
arrangement
between
the
Fund
and
the
Manager
pursuant
to
which
such
Fund
may
be
required
to
repay
amounts
waived
and/or
reimbursed
under
the
Fund's
contractual
caps
on
net
expenses will
be terminated.
As
of September
30,
2021,
the
fund
level
and
class
specific
waivers
and/or
reimbursements
subject
to
possible
future
recoupment
under
the
expense
limitation
agreement
are
as
follows:
Interfund
Lending:
In
accordance
with
an
exemptive
order
(the
"Order")
from
the
Securities
and
Exchange
Commission
("SEC"),
the
Fund
may
participate
in
a
joint
lending
and
borrowing
facility
for
temporary
purposes
(the
"Interfund
Lending
Program"),
subject
to
compliance
with
the
terms
and
conditions
of
the
Order,
and
to
the
extent
permitted
by
the
Fund's
investment
policies
and
restrictions.
The
Fund
is
currently
permitted
to borrow
and
lend
under
the
Interfund
Lending
Program.
A
lending
BlackRock
fund
may
lend
in
aggregate
up
to
15%
of
its
net
assets
but
may
not
lend
more
than
5%
of
its
net
assets
to
any
one
borrowing
fund
through
the
Interfund
Lending
Program.
A
borrowing
BlackRock
fund
may
not
borrow
through
the
Interfund
Lending
Program
or
from
any
other
source
more
than
33
1/3%
of
its
total
assets
(or
any
lower
threshold
provided
for
by
the fund's
investment
restrictions).
If
a
borrowing
BlackRock
fund's
total
outstanding
borrowings
exceed
10%
of
its
total
assets,
each
of
its
outstanding
interfund
loans
will
be
subject
to
collateralization
of
at
least
102%
of
the
outstanding
principal
value
of
the
loan.
All
interfund
loans
are
for
temporary
or
emergency
purposes
and
the
interest
rate
to
be
charged
will
be
the
average
of
the
highest
current
overnight
repurchase
agreement
rate
available
to
a
lending
fund
and
the
bank
loan
rate,
as
calculated
according
to
a
formula
established
by
the
Board.
During the
period
ended
September
30,
2021,
the
Fund
did
not
participate
in
the
Interfund
Lending
Program.
Trustees
and
Officers:
Certain
trustees
and/or
officers
of
the Trust are directors and/or
officers
of BlackRock
or
its
affiliates.
The
Fund
reimburses
the
Manager
for
a
portion
of
the
compensation
paid
to
the
Fund's
Chief
Compliance
Officer,
which
is
included
in
Trustees and
Officer
in
the
Statement
of
Operations.
7.
PURCHASES
AND
SALES
For
the period
ended
September
30,
2021,
purchases
and
sales
of
investments,
including
paydowns
and
excluding
short-term
investments, were $54,182,709
and
$4,993,667,
respectively.
8.
INCOME
TAX
INFORMATION
It
is
the
Fund's
policy
to
comply
with
the
requirements
of
the
Internal
Revenue
Code
of
1986,
as
amended,
applicable
to
regulated
investment
companies,
and
to
distribute
substantially
all
of
its
taxable
income
to
its
shareholders.
Therefore,
no
U.S.
federal
income
tax
provision
is
required.
The
Fund
files
U.S.
federal
and
various
state
and
local
tax
returns.
No
income
tax
returns
are
currently
under
examination.
The
statute
of
limitations
on
the
Fund's
U.S.
federal
tax
returns
generally
remains
open
for
a
period
of
three
fiscal
years
after
they
are
filed.
The
statutes
of
limitations
on
the
Fund's
state
and
local
tax
returns
may
remain
open
for
an
additional
year
depending
upon
the
jurisdiction.
Management
has
analyzed
tax
laws
and
regulations
and
their
application
to
the Fund
as
of
September
30,
2021,
inclusive
of
the
open
tax
return
years,
and
does
not
believe
that
there
are
any
uncertain
tax
positions
that
require
recognition
of
a
tax
liability
in
the
Fund's
financial
statements.
U.S.
GAAP
requires
that
certain
components
of
net
assets
be
adjusted
to
reflect
permanent
differences
between
financial
and
tax
reporting.
These
reclassifications
have
no
effect
on
net
assets
or
NAVs
per
share.
As
of
period
end,
the
following
permanent
differences
attributable
to
non-deductible
expenses
were
reclassified
to
the
following
accounts:
The
tax
character
of
distributions was
as
follows:
Expiring
September
30,
2023
Fund
Level
.........................................................................................................
$
132,18
3‌
Institutional
.........................................................................................................
64‌
Investor
A
..........................................................................................................
64‌
Class
K
...........................................................................................................
1,977‌
Fund
Name
Paid-in
Capital
Accumulated
Earnings
BlackRock
Sustainable
High
Yield
Bond
Fund
........................................................
$
(9,870‌)
$
9,870‌
Fund
Name
Period
Ended
09/30/21
BlackRock
Sustainable
High
Yield
Bond
Fund
Ordinary
income
.........................................................................................................
$
312,396‌
Notes
to
Financial
Statements
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
28
As
of
period
end,
the
tax
components
of
accumulated earnings
(loss) were
as
follows:
As
of
September
30,
2021, gross
unrealized
appreciation
and
depreciation
based
on
cost
of
investments
(including
short
positions
and
derivatives,
if
any)
for
U.S.
federal
income
tax
purposes
were
as
follows:
9.
PRINCIPAL
RISKS
In
the
normal
course
of
business,
the
Fund
invests
in
securities
or
other
instruments
and
may
enter
into
certain
transactions,
and
such
activities
subject
the
Fund
to
various
risks,
including
among
others,
fluctuations
in
the
market
(market
risk)
or
failure
of
an
issuer
to
meet
all
of
its
obligations.
The
value
of
securities
or
other
instruments
may
also
be
affected
by
various
factors,
including,
without
limitation:
(i)
the
general
economy;
(ii)
the
overall
market
as
well
as
local,
regional
or
global
political
and/or
social
instability;
(iii)
regulation,
taxation
or
international
tax
treaties
between
various
countries;
or
(iv)
currency,
interest
rate
and
price
fluctuations.
Local,
regional
or
global
events
such
as
war,
acts
of
terrorism,
the
spread
of
infectious
illness
or
other
public
health
issues,
recessions,
or
other
events
could
have
a
significant
impact
on
the
Fund
and its
investments.
The
Fund's
prospectus
provides
details
of
the
risks
to
which
the
Fund
is
subject.
Market Risk:
The
Fund
may
be
exposed
to
prepayment
risk,
which
is
the
risk
that
borrowers
may
exercise
their
option
to
prepay
principal
earlier
than
scheduled
during
periods
of
declining
interest
rates,
which
would
force
the
Fund
to
reinvest
in
lower
yielding
securities. The
Fund
may
also
be
exposed
to
reinvestment
risk,
which
is
the
risk
that
income
from
the
Fund's
portfolio
will
decline
if
the Fund
invests
the
proceeds
from
matured,
traded
or
called
fixed-income
securities
at
market
interest
rates
that
are
below
the
Fund
portfolio's
current
earnings
rate.
An
outbreak
of
respiratory
disease
caused
by
a
novel
coronavirus
has
developed
into
a
global
pandemic
and
has
resulted
in
closing
borders,
quarantines,
disruptions
to
supply
chains
and
customer
activity,
as
well
as
general
concern
and
uncertainty.
The
impact
of
this
pandemic,
and
other
global
health
crises
that
may
arise
in
the
future,
could
affect
the
economies
of
many
nations,
individual
companies
and
the
market
in
general
in
ways
that
cannot
necessarily
be
foreseen
at
the
present
time.
This
pandemic
may
result
in
substantial
market
volatility
and
may
adversely
impact
the
prices
and
liquidity
of
a
fund's
investments.
The duration
of
this
pandemic
and
its
effects
cannot
be
determined
with
certainty.
Valuation
Risk:
The
market
values
of
equities,
such
as
common
stocks
and
preferred
securities
or
equity
related
investments,
such
as
futures
and
options,
may
decline
due
to
general
market
conditions
which
are
not
specifically
related
to
a
particular
company.
They
may
also
decline
due
to
factors
which
affect
a
particular
industry
or
industries. The
Fund
may
invest
in
illiquid
investments.
An
illiquid
investment
is
any
investment
that the
Fund
reasonably
expects
cannot
be
sold
or
disposed
of
in
current
market
conditions
in
seven
calendar
days
or
less
without
the
sale
or
disposition
significantly
changing
the
market
value
of
the
investment. The
Fund
may
experience
difficulty
in
selling
illiquid
investments
in
a
timely
manner
at
the
price
that it
believes
the
investments
are
worth.
Prices
may
fluctuate
widely
over
short
or
extended
periods
in
response
to
company,
market
or
economic
news.
Markets
also
tend
to
move
in
cycles,
with
periods
of
rising
and
falling
prices.
This
volatility
may
cause
the
Fund's
NAV
to
experience
significant
increases
or
decreases
over
short
periods
of
time.
If
there
is
a
general
decline
in
the
securities
and
other
markets,
the
NAV
of the
Fund
may
lose
value,
regardless
of
the
individual
results
of
the
securities
and
other
instruments
in
which the
Fund
invests.
The
price the
Fund
could
receive
upon
the
sale
of
any
particular
portfolio
investment
may
differ
from the
Fund's
valuation
of
the
investment,
particularly
for
securities
that
trade
in
thin
or
volatile
markets
or
that
are
valued
using
a
fair
valuation
technique
or
a
price
provided
by
an
independent
pricing
service.
Changes
to
significant
unobservable
inputs
and
assumptions
(i.e.,
publicly
traded
company
multiples,
growth
rate,
time
to
exit)
due
to
the
lack
of
observable
inputs
may
significantly
impact
the
resulting
fair
value
and
therefore
the
Fund's
results
of
operations.
As
a
result,
the
price
received
upon
the
sale
of
an
investment
may
be
less
than
the
value
ascribed
by the
Fund,
and the
Fund
could
realize
a
greater
than
expected
loss
or
lesser
than
expected
gain
upon
the
sale
of
the
investment. The
Fund's
ability
to
value
its
investments
may
also
be
impacted
by
technological
issues
and/or
errors
by
pricing
services
or
other
third-party
service
providers.
Counterparty
Credit
Risk:
The
Fund
may
be
exposed
to
counterparty
credit
risk,
or
the
risk
that
an
entity
may
fail
to
or
be
unable
to
perform
on
its
commitments
related
to
unsettled
or
open
transactions,
including
making
timely
interest
and/or
principal
payments
or
otherwise
honoring
its
obligations.
The
Fund
manages
counterparty
credit
risk
by
entering
into
transactions
only
with
counterparties
that
the
Manager
believes
have
the
financial
resources
to
honor
their
obligations
and
by
monitoring
the
financial
stability
of
those
counterparties.
Financial
assets,
which
potentially
expose
the
Fund
to
market,
issuer
and
counterparty
credit
risks,
consist
principally
of
financial
instruments
and
receivables
due
from
counterparties.
The
extent
of
the
Fund's
exposure
to
market,
issuer
and
counterparty
credit
risks
with
respect
to
these
financial
assets
is
approximately
their
value
recorded
in
the
Statement
of
Assets
and
Liabilities,
less
any
collateral
held
by
the
Fund.
A
derivative
contract
may
suffer
a
mark-to-market
loss
if
the
value
of
the
contract
decreases
due
to
an
unfavorable
change
in
the
market
rates
or
values
of
the
underlying
instrument.
Losses
can
also
occur
if
the
counterparty
does
not
perform
under
the
contract.
Fund
Name
Undistributed
Ordinary
Income
Non-expiring
Capital
Loss
Carryforwards
(a)
Net
Unrealized
Gains
(Losses)
(b)
Total
BlackRock
Sustainable
High
Yield
Bond
Fund
.........................................
$
12,880
$
(
36,209
)
$
(
259,378
)
$
(282,707
)
(a)
Amounts
available
to
offset
future
realized
capital
gains.
(b)
The
difference
between
book-basis
and
tax-basis
net
unrealized
gains
(losses)
was
attributable
primarily
to
the
tax
deferral
of
losses
on
wash
sales
and
amortization
methods
for
premiums
and
discounts
on
fixed
income
securities.
Fund
Name
Tax
Cost
Gross
Unrealized
Appreciation
Gross
Unrealized
Depreciation
Net
Unrealized
Appreciation
(Depreciation)
BlackRock
Sustainable
High
Yield
Bond
Fund
..............................
$
52,388,
237‌
$
145,
037‌
$
(404,415‌)
$
(259,
378‌
)
Notes
to
Financial
Statements
(continued)
29
Notes
to
Financial
Statements
Concentration
Risk:
A
diversified
portfolio,
where
this
is appropriate
and
consistent
with
a
fund's
objectives,
minimizes
the
risk
that
a
price
change
of
a
particular
investment
will
have
a
material
impact
on
the
NAV
of
a
fund.
The
investment
concentrations
within
the
Fund's
portfolio
are
disclosed
in
its Schedule
of
Investments.
The
Fund
invests
a
significant
portion
of
its
assets
in
high
yield
securities.
High
yield
securities
that
are
rated
below
investment-grade
(commonly
referred
to
as
"junk
bonds")
or
are
unrated
may
be
deemed
speculative,
involve
greater
levels
of
risk
than
higher-rated
securities
of
similar
maturity
and
are
more
likely
to
default.
High
yield
securities
may
be
issued
by
less
creditworthy
issuers,
and
issuers
of
high
yield
securities
may
be
unable
to
meet
their
interest
or
principal
payment
obligations.
High
yield
securities
are
subject
to
extreme
price
fluctuations,
may
be
less
liquid
than
higher
rated
fixed-income
securities,
even
under
normal
economic
conditions,
and
frequently
have
redemption
features.
The
Fund
invests
a
significant
portion
of
its
assets
in
fixed-income
securities
and/or
use
derivatives
tied
to
the
fixed-income
markets.
Changes
in
market
interest
rates
or
economic
conditions
may
affect
the
value
and/or
liquidity
of
such
investments.
Interest
rate
risk
is
the
risk
that
prices
of
bonds
and
other
fixed-income
securities
will
increase
as
interest
rates
fall
and
decrease
as
interest
rates
rise.
The
Fund
may
be
subject
to
a
greater
risk
of
rising
interest
rates
due
to
the
current
period
of
historically
low
rates.
LIBOR
Transition
Risk:
The
United
Kingdom's
Financial
Conduct
Authority
announced
a phase
out of
the
LIBOR.
Although
many
LIBOR
rates
will
be
phased
out
by
the
end
of
2021,
a
selection
of
widely
used
USD
LIBOR
rates
will
continue
to
be
published
through
June
2023
in
order
to
assist
with
the
transition.
The
Fund
may
be
exposed
to
financial
instruments
tied
to
LIBOR
to
determine
payment
obligations,
financing
terms,
hedging
strategies
or
investment
value.
The
transition
process
away
from
LIBOR
might
lead
to
increased
volatility
and
illiquidity
in
markets
for,
and
reduce
the
effectiveness
of
new
hedges
placed
against,
instruments
whose
terms
currently
include
LIBOR.
The
ultimate
effect
of
the
LIBOR
transition
process
on
the
Fund
is
uncertain.
10.
CAPITAL
SHARE
TRANSACTIONS
Transactions
in
capital
shares
for
each
class
were
as
follows:
(a)
Commencement
of
operations.
As
of
September
30,
2021,
shares
owned
by
BlackRock
Financial
Management,
Inc.,
an
affiliate
of
the
Fund,
were
as
follows:
11.
SUBSEQUENT
EVENTS
Management
has
evaluated
the
impact
of
all
subsequent
events
on
the
Fund
through
the
date
the
financial
statements
were
issued
and
has
determined
that
there
were
no
subsequent
events
requiring
adjustment
or
additional
disclosure
in
the
financial
statements.
Period
from
07/22/21
(a)
to
09/30/21
Fund
Name/Share
Class
Shares
Amount
BlackRock
Sustainable
High
Yield
Bond
Fund
Institutional
Shares
sold
.............................................................................
10,000‌
$
100,000‌
10,000‌
$
100,000‌
Investor
A
Shares
sold
.............................................................................
10,000‌
$
100,000‌
10,000‌
$
100,000‌
Class
K
Shares
sold
.............................................................................
4,980,000‌
$
49,800,000‌
4,980,000‌
$
49,800,000‌
5,000,000‌
$
50,000,000‌
Institutional
.......................................................................................................
10,000‌
Investor
A
........................................................................................................
10,000‌
Class
K
.........................................................................................................
4,980,000‌
Report
of
Independent
Registered
Public
Accounting
Firm
2021
BlackRock
Annual
Report
to
Shareholders
30
To
the
Shareholders
of
BlackRock
Sustainable
High
Yield
Bond
Fund
and
the
Board
of
Trustees
of
BlackRock
Funds
V:
Opinion
on
the
Financial
Statements
and
Financial
Highlights
We
have
audited
the
accompanying
statement
of
assets
and
liabilities
of
BlackRock
Sustainable
High
Yield
Bond
Fund
of
BlackRock
Funds
V
(the
"Fund"),
including
the
schedule
of
investments,
as
of
September
30,
2021,
the
related
statements
of
operations
and
changes
in
net
assets,
and
the
financial
highlights
for
the
period
from
July
22,
2021
(commencement
of
operations)
through
September
30,
2021,
and
the
related
notes.
In
our
opinion,
the
financial
statements
and
financial
highlights
present
fairly,
in
all
material
respects,
the
financial
position
of
the
Fund
as
of
September
30,
2021,
and
the
results
of
its
operations,
the
changes
in
its
net
assets,
and
the
financial
highlights
for
the
period
from
July
22,
2021
(commencement
of
operations)
through
September
30,
2021,
in
conformity
with
accounting
principles
generally
accepted
in
the
United
States
of
America.
Basis
for
Opinion
These
financial
statements
and
financial
highlights
are
the
responsibility
of
the
Fund's
management.
Our
responsibility
is
to
express
an
opinion
on
the
Fund's
financial
statements
and
financial
highlights
based
on
our
audit.
We
are
a
public
accounting
firm
registered
with
the
Public
Company
Accounting
Oversight
Board
(United
States)
(PCAOB)
and
are
required
to
be
independent
with
respect
to
the
Fund
in
accordance
with
the
U.S.
federal
securities
laws
and
the
applicable
rules
and
regulations
of
the
Securities
and
Exchange
Commission
and
the
PCAOB.
We
conducted
our
audit
in
accordance
with
the
standards
of
the
PCAOB.
Those
standards
require
that
we
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
statements
and
financial
highlights
are
free
of
material
misstatement,
whether
due
to
error
or
fraud.
The
Fund
is
not
required
to
have,
nor
were
we
engaged
to
perform,
an
audit
of
its
internal
control
over
financial
reporting.
As
part
of
our
audit
we
are
required
to
obtain
an
understanding
of
internal
control
over
financial
reporting
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
Fund's
internal
control
over
financial
reporting.
Accordingly,
we
express
no
such
opinion.
Our
audit
included
performing
procedures
to
assess
the
risks
of
material
misstatement
of
the
financial
statements
and
financial
highlights,
whether
due
to
error
or
fraud,
and
performing
procedures
that
respond
to
those
risks.
Such
procedures
included
examining,
on
a
test
basis,
evidence
regarding
the
amounts
and
disclosures
in
the
financial
statements
and
financial
highlights.
Our
audit
also
included
evaluating
the
accounting
principles
used
and
significant
estimates
made
by
management,
as
well
as
evaluating
the
overall
presentation
of
the
financial
statements
and
financial
highlights.
Our
procedures
included
confirmation
of
securities
owned
as
of
September
30,
2021,
by
correspondence
with
the
custodian,
brokers,
and
agent
banks;
when
replies
were
not
received
from
brokers
or
agent
banks,
we
performed
other
auditing
procedures.
We
believe
that
our
audit
provides
a
reasonable
basis
for
our
opinion.
Deloitte
&
Touche
LLP
Boston,
Massachusetts
November
22,
2021
We
have
served
as
the
auditor
of
one
or
more
BlackRock
investment
companies
since
1992.
Important
Tax
Information
(unaudited)
The
Fund
hereby
designates
the
following
amount,
or
maximum
amount
allowable
by
law,
as
interest
income
eligible
to
be
treated
as
a
Section
163(j)
interest
dividend
for
the
fiscal
period
ended
September
30,
2021:
The
Fund
hereby
designates
the
following
amount,
or
maximum
amount
allowable
by
law,
as
interest-related
dividends
eligible
for
exemption
from
U.S.
withholding
tax
for
nonresident
aliens
and
foreign
corporations
for
the
fiscal
period
ended
September
30,
2021:
Fund
Name
Interest
Dividends
BlackRock
Sustainable
High
Yield
Bond
Fund
................................................................................
$
322,713‌
Fund
Name
Interest-Related
Dividends
BlackRock
Sustainable
High
Yield
Bond
Fund
................................................................................
$
304,854‌
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
31
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
The
Board
of
Trustees
(the
"Board,"
the
members
of
which
are
referred
to
as
"Board
Members")
of
BlackRock
Funds
V
(the
"Trust")
met
on
May
4,
2021
(the
"Meeting")
to
consider
the
approval
of
the
proposed
investment
advisory
agreement
(the
"Advisory
Agreement")
between
the
Trust,
on
behalf
of
BlackRock
Sustainable
High
Yield
Bond
Fund
(the
"Fund"),
a
series
of
the
Trust,
and
BlackRock
Advisors,
LLC
(the
"Manager"),
the
Fund's
investment
advisor.
The
Advisory
Agreement
was
the
same
agreement
that
had
been
previously
approved
by
the
Board
with
respect
to
certain
series
of
the
Trust.
The
Board
also
considered
the
initial
approval
of
the
proposed
sub-
advisory
agreement
(the
"Sub-Advisory
Agreement")
between
the
Manager
and
BlackRock
International
Limited
("BIL"),
with
respect
to
the
Fund.
The
Manager
and
BIL
are
referred
to
herein
as
"BlackRock."
The
Advisory
Agreement
and
the
Sub-Advisory
Agreement
are
referred
to
herein
as
the
"Agreements."
The
Approval
Process
Pursuant
to
the
Investment
Company
Act
of
1940
(the
"1940
Act"),
the
Board
is
required
to
consider
the
initial
approval
of
the
Agreements.
The
Board
members
whom
are
not
"interested
persons"
of
the
Trust,
as
defined
in
the
1940
Act,
are
considered
independent
Board
members
(the
"Independent
Board
Members").
In
connection
with
this
process,
the
Board
assessed,
among
other
things,
the
nature,
extent
and
quality
of
the
services
to
be
provided
to
the
Fund
by
BlackRock,
BlackRock's
personnel
and
affiliates,
including
(as
applicable):
investment
management
services;
accounting
oversight;
administrative
and
shareholder
services;
oversight
of
the
Fund's
service
providers;
risk
management
and
oversight;
and
legal,
regulatory
and
compliance
services.
At
the
Meeting,
the
Board
reviewed
materials
relating
to
its
consideration
of
the
Agreements.
The
Board
considered
all
factors
it
believed
relevant
with
respect
to
the
Fund,
including,
among
other
factors:
(a)
the
nature,
extent
and
quality
of
the
services
to
be
provided
by
BlackRock;
(b)
the
investment
performance
of
BlackRock
portfolio
management;
(c)
the
advisory
fee
and
the
estimated
cost
of
the
services
to
be
provided
and
estimated
profits
to
be
realized
by
BlackRock
and
its
affiliates
from
their
relationship
with
the
Fund;
(d)
the
sharing
of
potential
economies
of
scale;
(e)
potential
fall-out
benefits
to
BlackRock
and
its
affiliates
as
a
result
of
BlackRock's
relationship
with
the
Fund;
and
(f)
other
factors
deemed
relevant
by
the
Board
Members.
In
considering
approval
of
the
Agreements,
the
Board
met
with
the
relevant
investment
advisory
personnel
from
BlackRock
and
considered
all
information
it
deemed
reasonably
necessary
to
evaluate
the
terms
of
the
Agreements.
The
Board
received
materials
in
advance
of
the
Meeting
relating
to
its
consideration
of
the
Agreements,
including,
among
other
things,
(a)
fees
and
estimated
expense
ratios
of
the
Fund
in
comparison
to
the
fees
and
expense
ratios
of
a
peer
group
of
funds
as
determined
by
Broadridge
Financial
Solutions,
Inc.
("Broadridge")
and
other
metrics,
as
applicable;
(b)
information
on
the
composition
of
the
peer
group
of
funds
and
a
description
of
Broadridge's
methodology;
(c)
information
regarding
BlackRock's
economic
outlook
for
the
Fund
and
its
general
investment
outlook
for
the
markets;
(d)
information
regarding
fees
paid
to
service
providers
that
are
affiliates
of
BlackRock;
and
(e)
information
outlining
the
legal
duties
of
the
Board
under
the
1940
Act
with
respect
to
the
consideration
and
approval
of
the
Agreements.
The
Board
also
noted
information
received
at
prior
Board
meetings
concerning
compliance
records
and
regulatory
matters
relating
to
BlackRock.
The
Board
also
considered
other
matters
it
deemed
important
to
the
approval
process,
such
as
other
payments
to
be
made
to
BlackRock
or
its
affiliates
relating
to
securities
lending
and
cash
management,
and
BlackRock's
services
related
to
the
valuation
and
pricing
of
Fund
portfolio
holdings.
The
Board
noted
the
willingness
of
BlackRock's
personnel
to
engage
in
open,
candid
discussions
with
the
Board.
The
Board
did
not
identify
any
particular
information
as
determinative,
and
each
Board
Member
may
have
attributed
different
weights
to
the
various
items
considered.
A.
Nature,
Extent
and
Quality
of
the
Services
to
be
Provided
by
BlackRock
The
Board,
including
the
Independent
Board
Members,
reviewed
the
nature,
extent
and
quality
of
services
to
be
provided
by
BlackRock,
including
the
investment
advisory
services
to
be
provided
to
the
Fund.
The
Board
received
information
concerning
the
investment
philosophy
and
investment
process
to
be
used
by
BlackRock
in
managing
the
Fund,
as
well
as
a
description
of
the
capabilities,
personnel
and
services
of
BlackRock.
In
connection
with
this
review,
the
Board
considered
BlackRock's
in-
house
research
capabilities
as
well
as
other
resources
available
to
its
personnel.
The
Board
considered
the
scope
of
the
services
to
be
provided
by
BlackRock
to
the
Fund
under
the
Agreements
relative
to
services
typically
provided
by
third
parties
to
other
funds.
The
Board
noted
that
the
standard
of
care
applicable
under
the
Agreements
was
comparable
to
that
found
generally
in
investment
company
advisory
agreements.
The
Board
concluded
that
the
scope
of
BlackRock's
services
to
be
provided
to
the
Fund
was
consistent
with
the
Fund's
operational
requirements,
including,
in
addition
to
seeking
to
meet
its
investment
objective,
compliance
with
investment
restrictions,
tax
and
reporting
requirements
and
related
shareholder
services.
The
Board,
including
the
Independent
Board
Members,
also
considered
the
quality
of
the
administrative
and
other
non-investment
advisory
services
to
be
provided
by
BlackRock
and
its
affiliates
to
the
Fund.
The
Board
evaluated
the
procedures
of
BlackRock
designed
to
fulfill
its
fiduciary
duty
to
the
Fund
with
respect
to
possible
conflicts
of
interest,
including
BlackRock's
code
of
ethics
(regulating
the
personal
trading
of
BlackRock's
officers
and
employees),
the
procedures
by
which
BlackRock
allocates
trades
among
its
various
investment
advisory
clients,
the
integrity
of
the
systems
in
place
to
ensure
compliance
with
the
foregoing
and
the
record
of
BlackRock
in
these
matters.
The
Board
also
noted
information
received
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
BlackRock
Fixed
Income
Complex
(the
"Fund
Complex")
concerning
the
standards
of
BlackRock
and
its
affiliates
with
respect
to
the
execution
of
portfolio
transactions.
The
Board
considered,
among
other
factors,
with
respect
to
BlackRock:
the
number,
education
and
experience
of
investment
personnel
generally
and
the
Fund's
portfolio
management
team;
research
capabilities;
investments
by
portfolio
managers
in
the
funds
they
manage;
portfolio
trading
capabilities;
use
of
technology;
commitment
to
compliance;
credit
analysis
capabilities;
risk
analysis
and
oversight
capabilities;
and
the
approach
to
training
and
retaining
portfolio
managers
and
other
research,
advisory
and
management
personnel.
The
Board
also
considered
BlackRock's
overall
risk
management
program,
including
the
continued
efforts
of
BlackRock
and
its
affiliates
to
address
cybersecurity
risks
and
the
role
of
BlackRock's
Risk
&
Quantitative
Analysis
Group.
The
Board
engaged
in
a
review
of
BlackRock's
compensation
structure
with
respect
to
the
Fund's
portfolio
management
team
and
BlackRock's
ability
to
attract
and
retain
high-quality
talent
and
create
performance
incentives.
In
addition
to
investment
advisory
services,
the
Board
considered
the
nature
and
quality
of
the
administrative
and
other
non-investment
advisory
services
to
be
provided
to
the
Fund.
BlackRock
and
its
affiliates
will
provide
the
Fund
with
certain
administrative,
shareholder
and
other
services
(in
addition
to
any
such
services
provided
to
the
Fund
by
third
parties)
and
officers
and
other
personnel
as
are
necessary
for
the
operations
of
the
Fund,
as
applicable.
In
particular,
BlackRock
and
its
affiliates
will
provide
the
Fund
with
certain
administrative
services
including,
among
others:
(i)
responsibility
for
disclosure
documents,
such
as
the
prospectus,
the
summary
prospectus,
the
statement
of
additional
information
and
periodic
shareholder
reports;
(ii)
oversight
of
daily
accounting
and
pricing;
(iii)
responsibility
for
periodic
filings
with
regulators;
(iv)
overseeing
and
coordinating
the
activities
of
third-party
service
providers,
including,
among
others,
the
Fund's
custodian,
fund
accountant,
transfer
agent,
and
auditor;
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
32
(v)
organizing
Board
meetings
and
preparing
the
materials
for
such
Board
meetings;
(vi)
providing
legal
and
compliance
support;
(vii)
furnishing
analytical
and
other
support
to
assist
the
Board
in
its
consideration
of
strategic
issues;
and
(viii)
performing
or
managing
administrative
functions
necessary
for
the
operation
of
the
Fund,
such
as
tax
reporting,
expense
management,
fulfilling
regulatory
filing
requirements,
overseeing
the
Fund's
distribution
partners,
and
shareholder
call
center
and
other
services.
The
Board
reviewed
the
structure
and
duties
of
BlackRock's
fund
administration,
shareholder
services,
and
legal
&
compliance
departments
and
considered
BlackRock's
policies
and
procedures
for
assuring
compliance
with
applicable
laws
and
regulations.
B.
The
Investment
Performance
of
the
Fund
and
BlackRock
In
their
capacity
as
members
of
the
boards
of
directors/trustees
of
other
funds
in
the
Fund
Complex,
the
Board,
including
the
Independent
Board
Members,
previously
received
and
considered
information
about
BlackRock's
investment
performance
for
other
funds.
The
Board,
however,
did
not
consider
the
performance
history
of
the
Fund
because
the
Fund
had
not
yet
commenced
operations
as
of
the
date
of
the
Meeting.
C.
Consideration
of
the
Advisory/Management
Fees
and
the
Estimated
Cost
of
the
Services
to
be
Provided
and
Estimated
Profits
to
be
Realized
by
BlackRock
and
its
Affiliates
from
their
Relationship
with
the
Fund
The
Board,
including
the
Independent
Board
Members,
reviewed
the
Fund's
proposed
contractual
management
fee
rate
as
compared
with
the
other
funds
in
its
Broadridge
category.
The
contractual
management
fee
rate
represents
a
combination
of
the
advisory
fee
and
any
administrative
fees,
before
taking
into
account
any
reimbursements
or
fee
waivers.
The
Board
also
considered
the
Fund's
estimated
total
net
expense
ratio
compared
to
those
of
other
funds
in
its
Broadridge
category.
The
estimated
total
expense
ratio
represents
a
fund's
total
net
operating
expenses.
The
estimated
total
expense
ratio
gives
effect
to
any
expense
reimbursements
or
fee
waivers.
Additionally,
the
Board
noted
information
received
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
Fund
Complex
concerning
the
services
provided
and
the
fees
charged
by
BlackRock
and
its
affiliates
to
other
types
of
clients
with
similar
investment
mandates,
as
applicable,
including
institutional
accounts
and
sub-advised
mutual
funds
(including
mutual
funds
sponsored
by
third
parties).
The
Board
noted
that
it
had
previously
received
and
reviewed
statements
relating
to
BlackRock's
financial
condition
in
connection
with
their
duties
as
trustees
or
directors
of
other
funds
in
the
BlackRock
family
of
open-end
funds.
The
Board
considered
whether
BlackRock
has
the
financial
resources
necessary
to
attract
and
retain
high
quality
investment
management
personnel
to
perform
its
obligations
under
the
Agreements
and
to
provide
the
high
quality
of
services
that
is
expected
by
the
Board.
The
Board
further
considered
factors
including
but
not
limited
to
BlackRock's
commitment
of
time,
assumption
of
risk,
and
liability
profile
in
servicing
the
Fund
in
contrast
to
what
is
required
of
BlackRock
with
respect
to
other
products
with
similar
investment
mandates
across
the
open-end
fund,
exchange-traded
fund,
closed-end
fund,
sub-advised
mutual
fund,
separately
managed
account,
collective
investment
trust,
and
institutional
separate
account
product
channels.
The
Board
noted
that
the
Fund's
contractual
management
fee
ranked
in
the
second
quartile,
and
that
the
Fund's
estimated
actual
management
fee
rate
and
estimated
total
expense
ratio
each
ranked
in
the
first
quartile,
relative
to
the
Fund's
peers.
The
Board
also
noted
that
the
Fund
has
an
advisory
fee
arrangement
that
includes
breakpoints
that
adjust
the
fee
rate
downward
as
the
size
of
the
Fund
increases
above
certain
contractually
specified
levels.
The
Board
noted
that
if
the
size
of
the
Fund
were
to
decrease,
the
Fund
could
lose
the
benefit
of
one
or
more
breakpoints.
The
Board
further
noted
that
BlackRock
and
the
Board
have
contractually
agreed
to
a
cap
on
the
Fund's
total
expenses
as
a
percentage
of
the
Fund's
average
daily
net
assets
on
a
class-by-class
basis.
As
the
Fund
had
not
commenced
operations
as
of
the
date
of
the
Meeting,
BlackRock
was
not
able
to
provide
the
Board
with
specific
information
concerning
the
expected
profits
to
be
realized
by
BlackRock
and
its
affiliates
from
their
relationships
with
the
Fund.
BlackRock,
however,
will
provide
the
Board
with
such
information
at
future
meetings.
D.
Economies
of
Scale
The
Board,
including
the
Independent
Board
Members,
considered
the
extent
to
which
economies
of
scale
might
be
realized
as
the
assets
of
the
Fund
increase,
including
the
existence
of
fee
waivers
and/or
expense
caps,
as
applicable,
noting
that
any
contractual
fee
waivers
and
contractual
expense
caps
had
been
approved
by
the
Board.
E.
Other
Factors
Deemed
Relevant
by
the
Board
Members
The
Board,
including
the
Independent
Board
Members,
also
took
into
account
other
ancillary
or
"fall-out"
benefits
that
BlackRock
or
its
affiliates
may
derive
from
BlackRock's
respective
relationships
with
the
Fund,
both
tangible
and
intangible,
such
as
BlackRock's
ability
to
leverage
its
investment
professionals
who
manage
other
portfolios
and
its
risk
management
personnel,
an
increase
in
BlackRock's
profile
in
the
investment
advisory
community,
and
the
engagement
of
BlackRock's
affiliates
as
service
providers
to
the
Fund,
including
for
administrative,
distribution,
securities
lending
and
cash
management
services.
The
Board
also
considered
BlackRock's
overall
operations
and
its
efforts
to
expand
the
scale
of,
and
improve
the
quality
of,
its
operations.
The
Board
also
noted
that,
subject
to
applicable
law,
BlackRock
may
use
and
benefit
from
third-party
research
obtained
by
soft
dollars
generated
by
certain
registered
fund
transactions
to
assist
in
managing
all
or
a
number
of
its
other
client
accounts.
In
connection
with
its
consideration
of
the
Agreements,
the
Board
noted
that
it
considered
information
regarding
BlackRock's
brokerage
and
soft
dollar
practices
and
received
and
reviewed
reports
from
BlackRock
and
its
affiliates
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
Fund
Complex
which
included
information
on
brokerage
commissions
and
trade
execution
practices.
Conclusion
The
Board,
including
the
Independent
Board
Members,
unanimously
approved
the
Advisory
Agreement
between
BlackRock
and
the
Trust,
on
behalf
of
the
Fund,
for
a
two-year
term
beginning
on
the
effective
date
of
the
Advisory
Agreement
and
the
Sub-Advisory
Agreement
between
BlackRock
and
BIL
with
respect
to
the
Fund,
for
a
two-year
term
beginning
on
the
effective
date
of
the
Sub-Advisory
Agreement.
Based
upon
its
evaluation
of
all
of
the
aforementioned
factors
in
their
totality,
as
well
as
other
information,
the
Board,
including
the
Independent
Board
Members,
was
satisfied
that
the
terms
of
the
Advisory
Agreements
were
fair
and
reasonable
and
in
the
best
interest
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
(continued)
33
Disclosure
of
Investment
Advisory
Agreement
and
Sub-Advisory
Agreement
of
the
Fund
and
its
shareholders.
In
arriving
at
its
decision
to
approve
the
Advisory
Agreements,
the
Board
did
not
identify
any
single
factor
or
group
of
factors
as
all-important
or
controlling,
but
considered
all
factors
together,
and
different
Board
Members
may
have
attributed
different
weights
to
the
various
factors
considered.
The
Independent
Board
Members
were
also
assisted
by
the
advice
of
independent
legal
counsel
in
making
this
determination.
Trustee
and
Officer
Information
2021
BlackRock
Annual
Report
to
Shareholders
34
Independent
Trustees
(a)
Name
Year
of
Birth
(b)
Position(s)
Held
(Length
of
Service)
(c)
Principal
Occupation(s)
During
Past
Five
Years
Number
of
BlackRock-Advised
Registered
Investment
Companies
("RICs")
Consisting
of
Investment
Portfolios
("Portfolios")
Overseen
Public
Company
and
Other
Investment
Company
Directorships
Held
During
Past
Five
Years
Richard
E.
Cavanagh
1946
Co-Chair
of
the
Board
and
Trustee
(Since
2019)
Director,
The
Guardian
Life
Insurance
Company
of
America
since
1998;
Board
Chair,
Volunteers
of
America
(a
not-for-profit
organization)
from
2015
to
2018
(board
member
since
2009);
Director,
Arch
Chemicals
(chemical
and
allied
products)
from
1999
to
2011;
Trustee,
Educational
Testing
Service
from
1997
to
2009
and
Chairman
thereof
from
2005
to
2009;
Senior
Advisor,
The
Fremont
Group
since
2008
and
Director
thereof
since
1996;
Faculty
Member/Adjunct
Lecturer,
Harvard
University
since
2007
and
Executive
Dean
from
1987
to
1995;
President
and
Chief
Executive
Officer,
The
Conference
Board,
Inc.
(global
business
research
organization)
from
1995
to
2007.
74
RICs
consisting
of
101
Portfolios
None
Karen
P.
Robards
1950
Co-Chair
of
the
Board
and
Trustee
(Since
2019)
Principal
of
Robards
&
Company,
LLC
(consulting
and
private
investing)
since
1987;
Co-founder
and
Director
of
the
Cooke
Center
for
Learning
and
Development
(a
not-for-profit
organization)
since
1987;
Director
of
Enable
Injections,
LLC
(medical
devices)
since
2019;
Investment
Banker
at
Morgan
Stanley
from
1976
to
1987.
74
RICs
consisting
of
101
Portfolios
Greenhill
&
Co.,
Inc.;
AtriCure,
Inc.
(medical
devices)
from
2000
until
2017
Michael
J.
Castellano
1946
Trustee
(Since
2019)
Chief
Financial
Officer
of
Lazard
Group
LLC
from
2001
to
2011;
Chief
Financial
Officer
of
Lazard
Ltd
from
2004
to
2011;
Director,
Support
Our
Aging
Religious
(non-profit)
from
2009
to
June
2015
and
from
2017
to
September
2020;
Director,
National
Advisory
Board
of
Church
Management
at
Villanova
University
since
2010;
Trustee,
Domestic
Church
Media
Foundation
since
2012;
Director,
CircleBlack
Inc.
(financial
technology
company)
from
2015
to
July
2020.
74
RICs
consisting
of
101
Portfolios
None
Cynthia
L.
Egan
1955
Trustee
(Since
2019)
Advisor,
U.S.
Department
of
the
Treasury
from
2014
to
2015;
President,
Retirement
Plan
Services,
for
T.
Rowe
Price
Group,
Inc.
from
2007
to
2012;
executive
positions
within
Fidelity
Investments
from
1989
to
2007.
74
RICs
consisting
of
101
Portfolios
Unum
(insurance);
The
Hanover
Insurance
Group
(Board
Chair)
(insurance);
Huntsman
Corporation
(chemical
products);
Envestnet
(investment
platform)
from
2013
until
2016
Frank
J.
Fabozzi
(d)
1948
Trustee
(Since
2019)
Editor
of
The
Journal
of
Portfolio
Management
since
1986;
Professor
of
Finance,
EDHEC
Business
School
(France)
since
2011;
Visiting
Professor,
Princeton
University
for
the
2013
to
2014
academic
year
and
Spring
2017
semester;
Professor
in
the
Practice
of
Finance,
Yale
University
School
of
Management
from
1994
to
2011
and
currently
a
Teaching
Fellow
in
Yale's
Executive
Programs;
Board
Member,
BlackRock
Equity-Liquidity
Funds
from
2014
to
2016;
affiliated
professor
Karlsruhe
Institute
of
Technology
from
2008
to
2011;
Visiting
Professor,
Rutgers
University
for
the
Spring
2019
semester;
Visiting
Professor,
New
York
University
for
the
2019
academic
year;
Adjunct
Professor
of
Finance,
Carnegie
Mellon
University
in
fall
2020
semester.
76
RICs
consisting
of
103
Portfolios
None
Lorenzo
A.
Flores
1964
Trustee
(Since
2021)
Vice
Chairman,
Kioxia,
Inc.
since
2019;
Chief
Financial
Officer,
Xilinx,
Inc.
from
2016
to
2019;
Corporate
Controller,
Xilinx,
Inc.
from
2008
to
2016.
74
RICs
consisting
of
101
Portfolios
None
Stayce
D.
Harris
1959
Trustee
(Since
2021)
Lieutenant
General,
Inspector
General,
Office
of
the
Secretary
of
the
United
States
Air
Force
from
2017
to
2019;
Lieutenant
General,
Assistant
Vice
Chief
of
Staff
and
Director,
Air
Staff,
United
States
Air
Force
from
2016
to
2017;
Major
General,
Commander,
22nd
Air
Force,
AFRC,
Dobbins
Air
Reserve
Base,
Georgia
from
2014
to
2016;
Pilot,
United
Airlines
from
1990
to
2020.
74
RICs
consisting
of
101
Portfolios
The
Boeing
Company
since
2021
J.
Phillip
Holloman
1955
Trustee
(Since
2021)
President
and
Chief
Operating
Officer,
Cintas
Corporation
from
2008
to
2018.
74
RICs
consisting
of
101
Portfolios
PulteGroup,
Inc.
(home
construction);
Rockwell
Automation
Inc.
(industrial
automation)
Trustee
and
Officer
Information
(continued)
35
Trustee
and
Officer
Information
Interested
Trustees
(a)(e)
(a)
The
address
of
each
Trustee
is
c/o
BlackRock,
Inc.,
55
East
52nd
Street,
New
York,
New
York
10055.
(b)
Each
Independent
Trustee
holds
office
until
his
or
her
successor
is
duly
elected
and
qualifies
or
until
his
or
her
earlier
death,
resignation,
retirement
or
removal
as
provided
by
the
Trust's
by-laws
or
charter
or
statute,
or
until
December
31
of
the
year
in
which
he
or
she
turns
75.
Trustees
who
are
"interested
persons,"
as
defined
in
the
Investment
Company
Act
serve
until
their
successor
is
duly
elected
and
qualifies
or
until
their
earlier
death,
resignation,
retirement
or
removal
as
provided
by
the
Trust's
by-laws
or
statute,
or
until
December
31
of
the
year
in
which
they
turn
72.
The
Board
may
determine
to
extend
the
terms
of
Independent
Trustees
on
a
case-by-case
basis,
as
appropriate.
(c)
Following
the
combination
of
Merrill
Lynch
Investment
Managers,
L.P.
("MLIM")
and
BlackRock,
Inc.
in
September
2006,
the
various
legacy
MLIM
and
legacy
BlackRock
fund
boards
were
realigned
and
consolidated
into
three
new
fund
boards
in
2007.
Certain
Independent
Trustees
first
became
members
of
the
boards
of
other
legacy
MLIM
or
legacy
BlackRock
funds
as
follows:
Richard
E.
Cavanagh,
1994;
Frank
J.
Fabozzi,
1988;
R.
Glenn
Hubbard,
2004;
W.
Carl
Kester,
1995;
and
Karen
P.
Robards,
1998.
Certain
other
Independent
Trustees
became
members
of
the
boards
of
the
closed-end
funds
in
the
Fixed-Income
Complex
as
follows:
Michael
J.
Castellano,
2011;
Cynthia
L.
Egan,
2016;
and
Catherine
A.
Lynch,
2016.
(d)
Dr.
Fabozzi,
Dr.
Kester,
Ms.
Lynch
and
Mr.
Perlowski
are
also
trustees
of
the
BlackRock
Credit
Strategies
Fund
and
BlackRock
Private
Investments
Fund.
(e)
Mr.
Fairbairn
and
Mr.
Perlowski
are
both
"interested
persons,"
as
defined
in
the
1940
Act,
of
the
Trust
based
on
their
positions
with
BlackRock,
Inc.
and
its
affiliates.
Mr.
Fairbairn
and
Mr.
Perlowski
are
also
board
members
of
the
BlackRock
Multi-Asset
Complex.
Name
Year
of
Birth
(b)
Position(s)
Held
(Length
of
Service)
(c)
Principal
Occupation(s)
During
Past
Five
Years
Number
of
BlackRock-Advised
Registered
Investment
Companies
("RICs")
Consisting
of
Investment
Portfolios
("Portfolios")
Overseen
Public
Company
and
Other
Investment
Company
Directorships
Held
During
Past
Five
Years
R.
Glenn
Hubbard
1958
Trustee
(Since
2019)
Dean,
Columbia
Business
School
from
2004
to
2019;
Faculty
member,
Columbia
Business
School
since
1988.
74
RICs
consisting
of
101
Portfolios
ADP
(data
and
information
services)
2004-2020;
Metropolitan
Life
Insurance
Company
(insurance);
KKR
Financial
Corporation
(finance)
from
2004
until
2014
W.
Carl
Kester
(d)
1951
Trustee
(Since
2019)
George
Fisher
Baker
Jr.
Professor
of
Business
Administration,
Harvard
Business
School
since
2008;
Deputy
Dean
for
Academic
Affairs
from
2006
to
2010;
Chairman
of
the
Finance
Unit,
from
2005
to
2006;
Senior
Associate
Dean
and
Chairman
of
the
MBA
Program
from
1999
to
2005;
Member
of
the
faculty
of
Harvard
Business
School
since
1981.
76
RICs
consisting
of
103
Portfolios
None
Catherine
A.
Lynch
(d)
1961
Trustee
(Since
2019)
Chief
Executive
Officer,
Chief
Investment
Officer
and
various
other
positions,
National
Railroad
Retirement
Investment
Trust
from
2003
to
2016;
Associate
Vice
President
for
Treasury
Management,
The
George
Washington
University
from
1999
to
2003;
Assistant
Treasurer,
Episcopal
Church
of
America
from
1995
to
1999.
76
RICs
consisting
of
103
Portfolios
None
Robert
Fairbairn
1965
Trustee
(Since
2015)
Vice
Chairman
of
BlackRock,
Inc.
since
2019;
Member
of
BlackRock's
Global
Executive
and
Global
Operating
Committees;
Co-Chair
of
BlackRock's
Human
Capital
Committee;
Senior
Managing
Director
of
BlackRock,
Inc.
from
2010
to
2019;
oversaw
BlackRock's
Strategic
Partner
Program
and
Strategic
Product
Management
Group
from
2012
to
2019;
Member
of
the
Board
of
Managers
of
BlackRock
Investments,
LLC
from
2011
to
2018;
Global
Head
of
BlackRock's
Retail
and
iShares
®
businesses
from
2012
to
2016.
104
RICs
consisting
of
255
Portfolios
None
John
M.
Perlowski
(d)
1964
Trustee
(Since
2015);
President
and
Chief
Executive
Officer
(Since
2010)
Managing
Director
of
BlackRock,
Inc.
since
2009;
Head
of
BlackRock
Global
Accounting
and
Product
Services
since
2009;
Advisory
Director
of
Family
Resource
Network
(charitable
foundation)
since
2009.
106
RICs
consisting
of
257
Portfolios
None
Independent
Trustees
(a)
(continued)
Trustee
and
Officer
Information
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
36
Officers
Who
Are
Not
Trustees
(a)
(a)
The
address
of
each
Officer
is
c/o
BlackRock,
Inc.,
55
East
52nd
Street,
New
York,
New
York
10055.
(b)
Officers
of
the
Trust
serve
at
the
pleasure
of
the
Board.
Further
information
about
the
Trust's
Trustees
and
Officers
is
available
in
the
Trust's
Statement
of
Additional
Information,
which
can
be
obtained
without
charge
by
calling
(800)
441-7762.
Name
Year
of
Birth
(b)
Position(s)
Held
(Length
of
Service)
Principal
Occupation(s)
During
Past
Five
Years
Jennifer
McGovern
1977
Vice
President
(Since
2014)
Managing
Director
of
BlackRock,
Inc.
since
2016;
Director
of
BlackRock,
Inc.
from
2011
to
2015;
Head
of
Americas
Product
Development
and
Governance
for
BlackRock's
Global
Product
Group
since
2019;
Head
of
Product
Structure
and
Oversight
for
BlackRock's
U.S.
Wealth
Advisory
Group
from
2013
to
2019.
Trent
Walker
1974
Chief
Financial
Officer
(Since
2021)
Managing
Director
of
BlackRock,
Inc.
since
September
2019;
Executive
Vice
President
of
PIMCO
from
2016
to
2019;
Senior
Vice
President
of
PIMCO
from
2008
to
2015;
Treasurer
from
2013
to
2019
and
Assistant
Treasurer
from
2007
to
2017
of
PIMCO
Funds,
PIMCO
Variable
Insurance
Trust,
PIMCO
ETF
Trust,
PIMCO
Equity
Series,
PIMCO
Equity
Series
VIT,
PIMCO
Managed
Accounts
Trust,
2
PIMCO-sponsored
interval
funds
and
21
PIMCO-sponsored
closed-end
funds.
Jay
M.
Fife
1970
Treasurer
(Since
2007)
Managing
Director
of
BlackRock,
Inc.
since
2007.
Charles
Park
1967
Chief
Compliance
Officer
(Since
2014)
Anti-Money
Laundering
Compliance
Officer
for
certain
BlackRock-advised
Funds
from
2014
to
2015;
Chief
Compliance
Officer
of
BlackRock
Advisors,
LLC
and
the
BlackRock-advised
Funds
in
the
BlackRock
Multi-Asset
Complex
and
the
BlackRock
Fixed-Income
Complex
since
2014;
Principal
of
and
Chief
Compliance
Officer
for
iShares
®
Delaware
Trust
Sponsor
LLC
since
2012
and
BlackRock
Fund
Advisors
("BFA")
since
2006;
Chief
Compliance
Officer
for
the
BFA-advised
iShares
®
exchange
traded
funds
since
2006;
Chief
Compliance
Officer
for
BlackRock
Asset
Management
International
Inc.
since
2012.
Lisa
Belle
1968
Anti-Money
Laundering
Compliance
Officer
(Since
2019)
Managing
Director
of
BlackRock,
Inc.
since
2019;
Global
Financial
Crime
Head
for
Asset
and
Wealth
Management
of
JP
Morgan
from
2013
to
2019;
Managing
Director
of
RBS
Securities
from
2012
to
2013;
Head
of
Financial
Crimes
for
Barclays
Wealth
Americas
from
2010
to
2012.
Janey
Ahn
1975
Secretary
(Since
2019)
Managing
Director
of
BlackRock,
Inc.
since
2018;
Director
of
BlackRock,
Inc.
from
2009
to
2017.
Neal
J.
Andrews
retired
as
the
Chief
Financial
Officer
effective
December
31,
2020,
and
Trent
Walker
was
elected
as
the
Chief
Financial
Officer
effective
January
1,
2021.
Effective
June
10,
2021,
Stayce
D.
Harris
and
J.
Phillip
Holloman
were
each
appointed
to
serve
as
a
Trustee
of
the
Trust.
Effective
July
30,
2021,
Lorenzo
A.
Flores
was
appointed
to
serve
as
a
Trustee
of
the
Trust.
Additional
Information
37
Additional
Information
General
Information
Quarterly
performance,
semi-annual
and
annual
reports,
current
net
asset
value
and
other
information
regarding
the
Fund
may
be
found
on
BlackRock's
website,
which
can
be
accessed
at
blackrock.com
.
Any
reference
to
BlackRock's
website
in
this
report
is
intended
to
allow
investors
public
access
to
information
regarding
the
Fund
and
does
not,
and
is
not
intended
to,
incorporate
BlackRock's
website
in
this
report.
Householding
The
Fund
will
mail
only
one
copy
of
shareholder
documents,
including
prospectuses,
annual
and
semi-annual
reports,
Rule
30e-3
notices
and
proxy
statements,
to
shareholders
with
multiple
accounts
at
the
same
address.
This
practice
is
commonly
called
"householding"
and
is
intended
to
reduce
expenses
and
eliminate
duplicate
mailings
of
shareholder
documents.
Mailings
of
your
shareholder
documents
may
be
householded
indefinitely
unless
you
instruct
us
otherwise.
If
you
do
not
want
the
mailing
of
these
documents
to
be
combined
with
those
for
other
members
of
your
household,
please
call
the
Fund at
(800)
441-7762.
Availability
of
Quarterly
Schedule
of
Investments
The
Fund
files
its
complete
schedule
of
portfolio
holdings
with
the
SEC
for
the
first
and
third
quarters
of
each
fiscal
year
as
an
exhibit
to
its
reports
on
Form
N-PORT.
The
Fund's
Form
N-PORT is
available
on
the
SEC's
website
at
sec.gov
.
Additionally,
the
Fund
makes
its
portfolio
holdings
for
the
first
and
third
quarters
of
each
fiscal
year
available
at
blackrock.com/
fundreports
.
Availability
of
Proxy
Voting
Policies,
Procedures and
Voting
Records
A
description
of
the
policies
and
procedures
that
the
Fund
uses
to
determine
how
to
vote
proxies
relating
to
portfolio
securities
and
information
about
how
the
Fund
voted
proxies
relating
to
securities
held
in
the
Fund's
portfolio
during
the
most
recent
12-month
period
ended
June
30 is
available
without
charge,
upon
request (1)
by
calling
(800)
441-
7762
;
(2)
on
the
BlackRock
website
at
blackrock.com
;
and
(3)
on
the
SEC's
website
at
sec.gov
.
BlackRock's
Mutual
Fund
Family
BlackRock
offers
a
diverse
lineup
of
open-end
mutual
funds
crossing
all
investment
styles
and
managed
by
experts
in
equity,
fixed-income
and
tax-exempt
investing.
Visit
blackrock.com
for
more
information.
Shareholder
Privileges
Account
Information
Call
us
at
(800)
441-7762
from
8:00
AM
to
6:00
PM
ET
on
any
business
day
to
get
information
about
your
account
balances,
recent
transactions
and
share
prices.
You
can
also
visit
blackrock.com
for
more
information.
Automatic
Investment
Plans
Investor
class
shareholders
who
want
to
invest
regularly
can
arrange
to
have
$50
or
more
automatically
deducted
from
their
checking
or
savings
account
and
invested
in
any
of
the
BlackRock
funds.
Systematic
Withdrawal
Plans
Investor
class
shareholders
can
establish
a
systematic
withdrawal
plan
and
receive
periodic
payments
of
$50
or
more
from
their
BlackRock
funds,
as
long
as
their
account
balance
is
at
least
$10,000.
Retirement
Plans
Shareholders
may
make
investments
in
conjunction
with
Traditional,
Rollover,
Roth,
Coverdell,
Simple
IRAs,
SEP
IRAs
and
403(b)
Plans.
BlackRock
Privacy
Principles
BlackRock
is
committed
to
maintaining
the
privacy
of
its
current
and
former
fund
investors
and
individual
clients
(collectively,
"Clients")
and
to
safeguarding
their
non-public
personal
information.
The
following
information
is
provided
to
help
you
understand
what
personal
information
BlackRock
collects,
how
we
protect
that
information
and
why
in
certain
cases
we
share
such
information
with
select
parties.
If
you
are
located
in
a
jurisdiction
where
specific
laws,
rules
or
regulations
require
BlackRock
to
provide
you
with
additional
or
different
privacy-related
rights
beyond
what
is
set
forth
below,
then
BlackRock
will
comply
with
those
specific
laws,
rules
or
regulations.
BlackRock
obtains
or
verifies
personal
non-public
information
from
and
about
you
from
different
sources,
including
the
following:
(i)
information
we
receive
from
you
or,
if
applicable,
your
financial
intermediary,
on
applications,
forms
or
other
documents;
(ii)
information
about
your
transactions
with
us,
our
affiliates,
or
others;
(iii)
information
we
receive
from
a
consumer
reporting
agency;
and
(iv)
from
visits
to
our
websites.
Additional
Information
(continued)
2021
BlackRock
Annual
Report
to
Shareholders
38
BlackRock
does
not
sell
or
disclose
to
non-affiliated
third
parties
any
non-public
personal
information
about
its
Clients,
except
as
permitted
by
law
or
as
is
necessary
to
respond
to
regulatory
requests
or
to
service
Client
accounts.
These
non-affiliated
third
parties
are
required
to
protect
the
confidentiality
and
security
of
this
information
and
to
use
it
only
for
its
intended
purpose.
We
may
share
information
with
our
affiliates
to
service
your
account
or
to
provide
you
with
information
about
other
BlackRock
products
or
services
that
may
be
of
interest
to
you.
In
addition,
BlackRock
restricts
access
to
non-public
personal
information
about
its
Clients
to
those
BlackRock
employees
with
a
legitimate
business
need
for
the
information.
BlackRock
maintains
physical,
electronic
and
procedural
safeguards
that
are
designed
to
protect
the
non-public
personal
information
of
its
Clients,
including
procedures
relating
to
the
proper
storage
and
disposal
of
such
information.
Fund
and
Service
Providers
Investment
Adviser
and
Administrator
BlackRock
Advisors,
LLC
Wilmington,
DE
19809
Sub-Adviser
BlackRock
International
Limited
Edinburgh,
EH3
8BL
United
Kingdom
Accounting
Agent
JPMorgan
Chase
Bank,
N.A.
New
York,
NY
10179
Transfer
Agent
BNY
Mellon
Investment
Servicing
(US)
Inc.
Wilmington,
DE
19809
Custodian
JPMorgan
Chase
Bank,
N.A.
New
York,
NY
10179
Independent
Registered
Public
Accounting
Firm
Deloitte
&
Touche
LLP
Boston,
MA
02116
Distributor
BlackRock
Investments,
LLC
New
York,
NY
10022
Legal
Counsel
Willkie
Farr
&
Gallagher
LLP
New
York,
NY
10019
Address
of
the
Trust
100
Bellevue
Parkway
Wilmington,
DE
19809
Glossary
of
Terms
Used
in
this
Report
39
Glossary
of
Terms
Used
in
this
Report
Currency
Abbreviations
USD
United
States
Dollar
Portfolio
Abbreviations
DAC
Designated
Activity
Company
LIBOR
London
Interbank
Offered
Rate
MSCI
Morgan
Stanley
Capital
International
REIT
Real
Estate
Investment
Trust
Want
to
know
more?
blackrock.com
|
800-441-7762
This
report
is
intended
for
current
holders.
It
is
not
authorized
for
use
as
an
offer
of
sale
or
a
solicitation
of
an
offer
to
buy
shares
of
the
Fund
unless
preceded
or
accompanied
by
the
Fund's
current
prospectus.
Past
performance
results
shown
in
this
report
should
not
be
considered
a
representation
of
future
performance.
Investment
returns
and
principal
value
of
shares
will
fluctuate
so
that
shares,
when
redeemed,
may
be
worth
more
or
less
than
their
original
cost.
Statements
and
other
information
herein
are
as
dated
and
are
subject
to
change.
SHYB-9/21-AR
Item 2 - Code of Ethics -
The registrant (or the "Fund") has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. During the period covered by this report, the code of ethics was amended to update certain information and to make other non-material changes. During the period covered by this report, there have been no waivers granted under the code of ethics. The
registrant undertakes to provide a copy of the code of ethics to any person upon request, without charge, who calls 1-800-441-7762.
Item 3 - Audit Committee Financial Expert - The registrant's board of directors (the "board of directors"), has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:

Michael Castellano
Frank J. Fabozzi
Lorenzo A. Flores
Catherine A. Lynch
Karen P. Robards
The registrant's board of directors has determined that Karen P. Robards qualifies as an audit committee financial expert pursuant to Item 3(c)(4) of Form N-CSR.
Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been President of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.
Item 4 - Principal Accountant Fees and Services
The following table presents fees billed by Deloitte & Touche LLP ("D&T") in each of the last two fiscal years for the services rendered to the Fund:
(a) Audit Fees
(b) Audit-Related Fees1
(c) Tax Fees2
(d) All Other Fees
Entity Name
Current Fiscal Year End
Previous Fiscal Year End
Current Fiscal Year End
Previous Fiscal Year End
Current Fiscal Year End
Previous Fiscal Year End
Current Fiscal Year End
Previous Fiscal Year End
BlackRock Sustainable High Yield Bond Fund
$74,336
N/A
$0
$0
$23,000
N/A
$0
$0
The following table presents fees billed by D&T that were required to be approved by the registrant's audit committee (the "Committee") for services that relate directly to the operations or financial reporting of the Fund and that are rendered on behalf of BlackRock Advisors, LLC (the "Investment Adviser" or "BlackRock") and entities controlling, controlled by, or under common control with BlackRock (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the Fund ("Affiliated Service Providers"):
Current Fiscal Year End
Previous Fiscal Year End
(b) Audit-Related Fees1
$0
$0
(c) Tax Fees2
$0
$0
(d) All Other Fees3
$2,032,000
$1,984,000
1
The nature of the services includes assurance and related services reasonably related to the performance of the audit or review of financial statements not included in Audit Fees, including accounting consultations, agreed-upon procedure reports, attestation reports, comfort letters, out-of-pocket expenses and internal control reviews not required by regulators.
2
The nature of the services includes tax compliance and/or tax preparation, including services relating to the filing or amendment of federal, state or local income tax returns, regulated investment company qualification reviews, taxable income and tax distribution calculations.
3
Non-audit fees of $2,032,000 and $1,984,000 for the current fiscal year and previous fiscal year, respectively, were paid to the Fund's principal accountant in their entirety by BlackRock, in connection with services provided to the Affiliated Service Providers of the Fund and of certain other funds sponsored and advised by BlackRock or its affiliates for a service organization review and an accounting research tool subscription. These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(e)(1) Audit Committee Pre-Approval Policies and Procedures:
The Committee has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the Investment Adviser and Affiliated Service Providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are (a) consistent with the SEC's auditor independence rules and (b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis ("general pre-approval"). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operations or financial reporting of the registrant will only be deemed pre-approved provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 per project. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.
Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to the Committee Chairman the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.


(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g)
The aggregate non-audit fees, defined as the sum of the fees shown under "Audit-Related Fees," "Tax Fees" and "All Other Fees," paid to the accountant for services rendered by the accountant to the registrant, the Investment Adviser and the Affiliated Service Providers were:
Entity Name
Current Fiscal Year End
Previous Fiscal Year End
BlackRock Sustainable High Yield Bond Fund
$23,000
N/A
Additionally, the amounts billed by D&T in connection with services provided to the Affiliated Service Providers of the Fund and of other funds sponsored and advised by BlackRock or its affiliates during the current and previous fiscal years for a service organization review and an accounting research tool subscription were:
Current Fiscal Year End
Previous Fiscal Year End
$2,032,000
$1,984,000
These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.
(h) The Committee has considered and determined that the provision of non-audit services that were rendered to the Investment Adviser and
the Affiliated Service Providers
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence.
Item 5 - Audit Committee of Listed Registrant - Not Applicable
Item 6 - Investments

(a) The registrant's Schedule of Investments is included as part of the Report to Stockholders filed under Item 1(a) of this Form.

(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.
Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies - Not Applicable
Item 8 - Portfolio Managers of Closed-End Management Investment Companies - Not Applicable
Item 9 - Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers - Not Applicable
Item 10 - Submission of Matters to a Vote of Security Holders - There have been no material changes to these procedures.
Item 11 - Controls and Procedures
(a) The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act")) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Securities Exchange Act of 1934, as amended.
(b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
Item 12 - Disclosure of Securities Lending Activities for Closed-End Management Investment Companies - Not Applicable
Item 13 - Exhibits attached hereto
(a)(1) Code of Ethics - See Item 2
(a)(2) Section 302 Certifications are attached
section302
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) Section 906 Certifications are attached
section906
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BlackRock Funds V
By: /s/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Funds V
Date: December 3, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: /s/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Funds V
Date: December 3, 2021
By: /s/ Trent Walker
Trent Walker
Chief Financial Officer (principal financial officer) of
BlackRock Funds V
Date: December 3, 2021