Blackrock Income Trust Inc · NYSE:BKT
Blackrock Income Trust — Proxy Contest (July 2017)
22 slides from Blackrock Income Trust's proxy contest presentation, Jul 17, 2017
Slide 1: BlackRock Income Trust (BKT) July 2017
BlackRock Income Trust (BKT) July 2017
Slide 2: Executive Summary
Executive Summary BlackRock Advisors, LLC (the “Advisor”) launched BlackRock Income Trust (“BKT” or the “Fund”) in 1988 and has served as the Fund’s investment adviser since the Fund’s $544 million initial public offering. The Advisor has extensive experience in managing U.S. mortgage bonds, which a
Slide 3: BlackRock's Agency Mortgage Platform
BlackRock’s Agency Mortgage Platform As of December 31, 2016 (Years at BlackRock / Years in Industry) Team is based in New York The Global Trading team within the Trading and Liquidity Strategy Group includes approximately 80 traders globally that focus on executing trades across fixed income and FX
Slide 4: BKT Investment Objective: Preservation of Capital and High Monthly Income
BKT Investment Objective: Preservation of Capital and High Monthly Income The Fund’s investment objective is to manage a portfolio of high quality securities to achieve both preservation of capital and high monthly income. The Board and BlackRock believe that investors in the Fund should consider th
Slide 5: Other Measures of Comparing the Fund's Performance
Other Measures of Comparing the Fund’s Performance Given the limitations of the Lipper Peer Group discussed above, the Board has historically considered alternative measures of performance when evaluating the Fund.(i) In the past and also in evaluating the performance concerns raised by the Proponen
Slide 6: Peer Group Performance Comparison
Peer Group Performance Comparison The Board and BlackRock believe that the Fund has performed well for its investment objective and high credit quality mandate. The Fund’s high quality bias means that investors are subject to less credit risk and should experience lower volatility as a result of cre
Slide 7: Impact of Advisory Agreement Termination
Impact of Advisory Agreement Termination If Proposal 2 is approved, the Fund would be required to provide 60 days’ notice of termination to the Advisor. The termination of the Advisory Agreement could lead to the loss of access to all administrative personnel and services currently provided by the A
Slide 8: Appendix A Portfolio Composition
Appendix A Portfolio Composition
Slide 9: Portfolio Composition
Lipper Peer Group – Portfolio Composition The Fund’s annual shareholder reports compare the Fund’s performance to the Lipper Peer Group as a reference point, given that it is a publicly available peer group. The Fund is currently classified by Lipper into the U.S. Mortgage Funds Peer Group. However,
Slide 10: Custom Portfolio Composition
Custom Peer Group – Portfolio Composition As shown below, there are a total of five funds in the Custom Peer Group, including the Fund. Earlier this year, these Custom Peer Group funds (including the Fund) had between 99% and 83% of their assets invested in AAA-rated bonds, securities issued or guar
Slide 11: Appendix B Annualized Total Return
Appendix B Annualized Total Return on Net Asset Value
Slide 12: Annualized Total Return
Lipper Peer Group – Annualized Total Return on Net Asset Value As shown below, as of the Fund’s most recent fiscal year ended August 31, 2016, the Fund had performed comparably to the Lipper Peer Group on a net asset value basis for the 10 year period. Moreover, in 2008, as bond markets suffered lar
Slide 13: Custom Annualized Total Return
Custom Peer Group – Annualized Total Return on Net Asset Value The Fund has performed very well over most periods as compared to the Custom Peer Group, with the Fund being the best performing fund in the Custom Peer Group for annualized total return based on net asset value for the 3-, 5- and 10-yea
Slide 14: Custom Internal Benchmark – Annualized Total Return
Custom Internal Benchmark – Annualized Total Return on Net Asset Value Given the limitations of the Lipper Peer Group discussed herein, the Board has historically considered alternative measures of performance when evaluating the Fund. For example, as disclosed in the Fund’s most recent annual repor
Slide 15: Appendix C Sharpe Ratio
Appendix C Sharpe Ratio on Net Asset Value
Slide 16: Sharpe Ratio
Lipper Peer Group – Sharpe Ratio on Net Asset Value As shown below, the Fund has performed well versus the Lipper Peer Group on a risk adjusted basis, as measured by the Sharpe Ratio, given the Fund’s higher credit quality. The Sharpe Ratio is a measure for calculating risk-adjusted returns. The hig
Slide 17: Custom Sharpe Ratio
Custom Peer Group – Sharpe Ratio on Net Asset Value As shown below, the Fund has similarly performed very well versus the Custom Peer Group on a risk adjusted basis, as measured by the Sharpe Ratio. The Fund was the best performing fund in the Custom Peer Group for Sharpe Ratio based on net asset va
Slide 18: Appendix D Additional Information
Appendix D Additional Information
Slide 19: Overview of Appendix D
Overview of Appendix D As shown on slide 20 in Appendix D, non-agency mortgage backed securities have significantly outperformed agency mortgage backed securities over the past five years, a period which has been favorable for owning credit risk. As discussed, many of the funds in the Lipper Peer Gr
Slide 20: Asset Class Performance
Asset Class Performance BKT primarily invests in agency mortgage backed securities whereas many funds in the Lipper Peer Group primarily invest in non-agency mortgage backed securities As shown below, total returns for each of these asset classes have varied significantly over the past five calendar
Slide 21: BKT & Lipper Peers – 5 Year Performance & Correlation to Major Indices
5 Year Correlation Name 5 Year Annualized Total Return on Net Asset Value S&P 500 Total Return Index Bloomberg Barclays U.S. High Yield 2% Issuer Capped Index Total Return USD Bloomberg Barclays U.S. Aggregate Bond Index Total Return USD Citi U.S. BIG Mortgage Index Total Return BlackRock Income Tru
Slide 22: Index Definitions
Index Definitions Bloomberg Barclays ABS Index The Asset-Backed Securities (ABS) Index has three subsectors: (1) Credit and charge cards; (2) Autos; and (3) Utility. This index is the ABS component of the U.S. Aggregate index. Bloomberg Barclays Non-Agency CMBS Aggregate ERISA-Eligible Index This in