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: 811-23511
 
Name of Fund:  BlackRock ETF Trust II
iShares Mortgage-Backed Securities Active ETF
 
Fund Address:   100 Bellevue Parkway, Wilmington, DE 19809
 
Name and address of agent for service:  John M. Perlowski, Chief Executive Officer, BlackRock ETF Trust II, 50 Hudson Yards, New York, NY 10001
 
Registrant’s telephone number, including area code: (800) 441-7762
 
Date of fiscal year end: 09/30/2026
 
Date of reporting period: 03/31/2026
 
Item 1 – Reports to Stockholders

(a) The Reports to Shareholders are attached herewith.
0001804196falseN-CSRSBlackRock ETF Trust IIN-1A2026-03-310001804196blk:C000262359Member2025-10-012026-03-3100018041962025-10-012026-03-310001804196blk:C000262359Member2026-03-310001804196blk:C000262359Memberblk:USGovernmentSponsoredAgencySecuritiesCTIMember2026-03-310001804196blk:C000262359Memberblk:NonMinusAgencyMortgageMinusBackedSecuritiesCTIMember2026-03-310001804196blk:C000262359Memberblk:AAAAaaCTIMember2026-03-310001804196blk:C000262359Memberblk:AAAaCTIMember2026-03-31iso4217:USDxbrli:sharesiso4217:USDxbrli:sharesxbrli:pureutr:Dblk:Holding

iShares Mortgage-Backed Securities Active ETF

Image

MBBA | Cboe BZX Exchange

Semi-Annual Shareholder Report — March 31, 2026

This semi-annual shareholder report contains important information about iShares Mortgage-Backed Securities Active ETF (the “Fund”) for the period of October 1, 2025 to March 31, 2026.You can find additional information about the Fund at blackrock.com/fundreports. You can also request this information by contacting us at (800) 474-2737. Effective as of the close of trading on the New York Stock Exchange on January 23, 2026, BlackRock Mortgage-Backed Securities Fund was reorganized into the Fund.

What were the Fund costs for the last six months?

(based on a hypothetical $10,000 investment)

Table Summary
Class name
Costs of a $10,000 investment
Costs paid as a percentage of a $10,000 investment
iShares Mortgage-Backed Securities Active ETF
$24
0.48%Footnote Reference(a)
FootnoteDescription
Footnote(a)
Annualized.

Key Fund statistics

Table Summary
Net Assets........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
$125,783,910
Number of Portfolio Holdings........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
531
Portfolio Turnover Rate........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
1,127%

What did the Fund invest in?

(as of March 31, 2026) 

Portfolio composition

Credit quality allocation

Table Summary
Investment Type
Percent of Total InvestmentsFootnote Reference(a)
U.S. Government Sponsored Agency Securities........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
93.0%
Non-Agency Mortgage-Backed Securities........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
7.0
Table Summary
Credit RatingFootnote Reference(b)
Percent of Total InvestmentsFootnote Reference(a)
AAA/AaaFootnote Reference(c)........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
32.7%
AA/Aa........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
67.3
FootnoteDescription
Footnote(a)
Excludes short-term securities, short investments and options, if any.
Footnote(b)
For purposes of this report, credit quality ratings shown above reflect the highest rating assigned by either S&P Global Ratings, Moody's Investors Service, Inc. or Fitch Ratings, Inc. 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 N/R, if any, are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.
Footnote(c)
The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors, individual investments and/or issuers. Using this approach, the investment adviser has deemed unrated U.S. Government Sponsored Agency Securities and/or U.S. Treasury Obligations to be of similar credit quality as investments rated AAA/Aaa.

Additional information

If you wish to view additional information about the Fund, including but not limited to financial statements, the Fund’s prospectus, and proxy voting policies and procedures, please visit blackrock.com/fundreports. For proxy voting records, visit blackrock.com/proxyrecords.

 

©2026 BlackRock, Inc. or its affiliates. All rights reserved. BLACKROCK is a registered trademark of BlackRock, Inc. or its affiliates. All other trademarks are those of their respective owners. 

Image

iShares Mortgage-Backed Securities Active ETF

MBBA | Cboe BZX Exchange

Semi-Annual Shareholder Report — March 31, 2026

MBBA-03/26-SAR

(b) Not Applicable
 
Item 2 – Code of Ethics – Not Applicable to this semi-annual report.
 
Item 3 – Audit Committee Financial Expert – Not Applicable to this semi-annual report.
 
Item 4 – Principal Accountant Fees and Services – Not Applicable to this semi-annual report.
 
Item 5 –  Audit Committee of Listed Registrant – Not Applicable to this semi-annual report.
Item 6 – Investments

(a) The registrant’s Schedule of Investments is included as part of the Financial Statements and Financial Highlights for Open-End Management Investment Companies filed under Item 7 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 – Financial Statements and Financial Highlights for Open-End Management Investment Companies
 
              (a) The registrant’s Financial Statements are attached herewith.

(b) The registrant’s Financial Highlights are attached herewith.
MARCH
31,
2026
Not
FDIC
Insured
-
May
Lose
Value
-
No
Bank
Guarantee
2026
Semi-Annual
Financial
Statements
and
Additional
Information
(Unaudited)
BlackRock
ETF
Trust
II
iShares
Mortgage-Backed
Securities
Active
ETF
|
MBBA
|Cboe
BZX
Table
of
Contents
Page
2
Derivative
Financial
Instruments
.............................................................................................
3
Schedule
of
Investments
..................................................................................................
4
Statement
of
Assets
and
Liabilities
............................................................................................
12
Statement
of
Operations
..................................................................................................
13
Statements
of
Changes
in
Net
Assets
..........................................................................................
14
Financial
Highlights
.....................................................................................................
15
Notes
to
Financial
Statements
...............................................................................................
16
Additional
Information
....................................................................................................
27
Disclosure
of
Investment
Advisory
Agreement
.....................................................................................
29
Glossary
of
Terms
Used
in
these
Financial
Statements
................................................................................
32
Derivative
Financial
Instruments
3
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. Pursuant
to Rule
18f-4
under
the
1940
Act,
among
other
things,
the
Fund
must
either
use
derivative
financial
instruments
with
embedded
leverage
in
a
limited
manner
or
comply
with
an
outer
limit
on
fund
leverage
risk
based
on
value-at-risk.
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.
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
Schedule
of
Investments
(unaudited)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
4
(Percentages
shown
are
based
on
Net
Assets)
Security
Par
(000)
Par
(000)
Value
Non-Agency
Mortgage-Backed
Securities
Collateralized
Mortgage
Obligations
—
0.9%
(a)
Angel
Oak
Mortgage
Trust,
Series
2025-11,
Class
A1,
4.97%,
10/25/70
(b)
...........
USD
168
$
166,782
Ellington
Financial
Mortgage
Trust
Series
2025-INV5,
Class
A1,
5.08%,
12/25/70
(b)
.....................
341
339,513
Series
2025-NQM6,
Class
A1A,
5.00%,
12/25/70
(c)
.....................
132
131,092
GCAT
Trust,
Series
2025-NQM6,
Class
A1,
4.93%,
10/25/70
(b)
..................
117
116,593
GS
Mortgage-Backed
Securities
Trust
(c)
Series
2025-DSC2,
Class
A1,
5.04%,
01/25/66
......................
135
134,715
Series
2025-NQM5,
Class
A1,
5.01%,
07/25/65
......................
93
92,361
New
Residential
Mortgage
Loan
Trust,
Series
2025-NQM7,
Class
A1,
5.01%,
10/26/65
(b)
..
191
190,236
1,171,292
Commercial
Mortgage-Backed
Securities
—
11.5%
(a)
1301
Trust,
Series
2025-1301,
Class
A,
5.06%,
08/11/42
(b)
.......................
165
165,391
1345T,
Series
2025-AOA,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.60%
Floor
+
1.60%),
5.27%,
06/15/42
(b)
.......................
400
398,749
ARES
Trust,
Series
2025-IND3,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.50%
Floor
+
1.50%),
5.17%,
04/15/42
(b)
..................
221
221,000
BAY
Mortgage
Trust,
Series
2025-LIVN,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.80%
Floor
+
1.80%),
5.47%,
05/15/35
(b)
............
431
428,711
BBCMS
Mortgage
Trust,
Series
2018-TALL,
Class
A,
(1-mo.
CME
Term
SOFR
at
0.87%
Floor
+
0.92%),
4.59%,
03/15/37
(b)
.......
295
279,523
BFLD
Commercial
Mortgage
Trust
(b)
Series
2024-UNIV,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.49%
Floor
+
1.49%),
5.17%,
11/15/41
......................
150
150,047
Series
2025-5MW,
Class
A,
4.67%,
10/10/42
295
292,672
Series
2025-660F,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.50%
Floor
+
1.50%),
5.17%,
11/15/42
......................
175
174,782
BFLD
Trust
(b)
Series
2025-EWEST,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.55%
Floor
+
1.55%),
5.22%,
06/15/42
.................
282
281,100
Series
2025-FPM,
Class
A,
4.68%,
10/10/40
110
110,382
BPR
Commercial
Mortgage
Trust,
Series
2025-
STAR,
Class
A,
4.62%,
11/05/42
(b)
.......
190
188,383
BPR
Mortgage
Trust,
Series
2025-ALDR,
Class
A,
5.67%,
06/05/42
.................
163
166,926
BSTN
Commercial
Mortgage
Trust
(b)
Series
2025-1C,
Class
A,
5.01%,
06/15/44
..
120
122,038
Series
2025-HUB,
Class
A,
4.57%,
04/13/41
115
114,852
BWAY
Trust,
Series
2025-1535,
Class
A,
5.89%,
05/05/42
(b)
.......................
204
206,426
BX
Commercial
Mortgage
Trust
(b)
Series
2025-BCAT,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.38%
Floor
+
1.38%),
5.05%,
08/15/42
......................
326
325,817
Series
2025-JDI,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.40%
Floor
+
1.40%),
5.07%,
11/15/42
......................
271
271,291
Series
2025-SPOT,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.44%
Floor
+
1.44%),
5.12%,
04/15/40
.................
319
319,188
Security
Par
(000)
Par
(000)
Value
Commercial
Mortgage-Backed
Securities
(continued)
Series
2026-VLT9,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.70%
Floor
+
1.70%),
5.37%,
03/15/45
......................
USD
190
$
189,080
BX
Trust
(b)
Series
2024-BIO,
Class
A,
(1-mo.
CME
Term
SOFR
+
1.64%),
5.31%,
02/15/41
.....
125
124,687
Series
2024-VLT4,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.49%
Floor
+
1.49%),
5.16%,
06/15/41
......................
110
109,312
Series
2025-ARIA,
Class
A,
5.03%,
12/13/42
170
170,895
Series
2025-LIFE,
Class
A,
5.88%,
06/13/47
300
300,862
Series
2025-LUNR,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.50%
Floor
+
1.50%),
5.17%,
06/15/40
.................
381
381,704
Series
2025-OMG,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.35%
Floor
+
1.35%),
5.02%,
10/15/42
......................
161
160,598
Series
2025-TAIL,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.40%
Floor
+
1.40%),
5.07%,
06/15/35
......................
315
315,000
Series
2025-VLT6,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.44%
Floor
+
1.44%),
5.12%,
03/15/42
......................
820
814,362
Series
2025-VOLT,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.70%
Floor
+
1.70%),
5.37%,
12/15/44
......................
230
229,281
CENT,
Series
2025-CITY,
Class
A,
4.92%,
07/10/40
(b)
.......................
250
251,793
CHI
Commercial
Mortgage
Trust,
Series
2025-
110W,
Class
A,
5.10%,
12/13/40
(b)
.......
175
173,818
CIP
Commercial
Mortgage
Trust,
Series
2025-
SBAY,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.40%
Floor
+
1.40%),
5.07%,
10/15/37
(b)
..
195
194,878
Commercial
Mortgage
Trust,
Series
2024-WCL1,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.84%
Floor
+
1.84%),
5.51%,
06/15/41
(b)
.......
261
260,102
CSTL
Commercial
Mortgage
Trust,
Series
2025-
GATE2,
Class
A,
4.56%,
11/10/42
(b)
......
170
167,131
DBC
Mortgage
Trust,
Series
2025-DBC,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.35%
Floor
+
1.35%),
5.02%,
11/15/42
(b)
.............
355
354,779
DK
Trust,
Series
2025-LXP,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.59%
Floor
+
1.59%),
5.27%,
08/15/37
(b)
.......................
330
330,000
Durst
Commercial
Mortgage
Trust,
Series
2025-
151,
Class
A,
4.80%,
08/10/42
(b)
.........
163
164,504
GSAT
Trust,
Series
2025-BMF,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.50%
Floor
+
1.50%),
5.17%,
07/15/40
(b)
..................
435
434,575
INTOWN
Mortgage
Trust,
Series
2025-STAY,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.35%
Floor
+
1.35%),
5.02%,
03/15/42
(b)
.......
429
427,928
J.P.
Morgan
Chase
Commercial
Mortgage
Securities
Trust,
Series
2025-BHR5,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.69%
Floor
+
1.69%),
5.37%,
03/15/40
(b)
............
86
85,904
KSL
Commercial
Mortgage
Trust,
Series
2024-
HT2,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.54%
Floor
+
1.54%),
5.21%,
12/15/39
(b)
..
242
241,955
LEX
Trust,
Series
2026-450,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.35%
Floor
+
1.35%),
5.02%,
03/15/43
(b)
..................
143
142,374
LQR
Trust,
Series
2025-CALI,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.60%
Floor
+
1.60%),
5.27%,
01/15/43
(b)
..................
157
155,925
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
Schedule
of
Investments
5
(Percentages
shown
are
based
on
Net
Assets)
Security
Par
(000)
Par
(000)
Value
Commercial
Mortgage-Backed
Securities
(continued)
MAD
Commercial
Mortgage
Trust,
Series
2025-
11MD,
Class
A,
4.44%,
10/15/42
(b)
.......
USD
145
$
144,339
MTN
Commercial
Mortgage
Trust,
Series
2022-
LPFL,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.40%
Floor
+
1.40%),
5.08%,
03/15/39
(b)
..
182
181,886
NCMF
Trust,
Series
2025-MFS,
Class
A,
4.88%,
06/10/33
(b)
.......................
399
397,545
NRTH
Commercial
Mortgage
Trust,
Series
2025-
PARK,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.39%
Floor
+
1.39%),
5.07%,
10/15/40
(b)
..
445
444,583
NYC
Commercial
Mortgage
Trust
(b)
Series
2025-28L,
Class
A,
4.67%,
11/05/38
.
100
99,577
Series
2025-3BP,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.21%
Floor
+
1.21%),
4.89%,
02/15/42
......................
565
561,469
NYC
Trust,
Series
2025-77C,
Class
A,
4.79%,
01/10/36
(b)
.......................
345
342,238
PENN
Commercial
Mortgage
Trust,
Series
2025-
P11,
Class
A,
5.34%,
08/10/42
(b)
.........
72
73,157
PRM
Trust,
Series
2025-PRM6,
Class
A,
4.48%,
07/05/33
(b)
.......................
327
324,442
SDAL
Trust,
Series
2025-DAL,
Class
A,
(1-mo.
CME
Term
SOFR
at
2.44%
Floor
+
2.44%),
6.11%,
04/15/42
(b)
..................
435
435,965
SDR
Commercial
Mortgage
Trust,
Series
2024-
DSNY,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.39%
Floor
+
1.39%),
5.06%,
05/15/39
(b)
..
100
99,687
SHRN
Trust,
Series
2025-MF18,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.20%
Floor
+
1.20%),
4.87%,
10/15/40
(b)
..................
73
72,818
UNIV
Trust,
Series
2025-APTS,
Class
A,
(1-mo.
CME
Term
SOFR
at
1.65%
Floor
+
1.65%),
5.32%,
11/15/42
(b)
..................
180
179,368
WEST
Trust,
Series
2025-ROSE,
Class
A,
5.28%,
04/10/35
(b)
..................
266
267,110
WHARF
Commercial
Mortgage
Trust,
Series
2025-DC,
Class
A,
4.99%,
07/15/40
(b)
.....
191
195,256
Willobrook
Mall,
Series
2025-WBRK,
Class
A,
5.87%,
03/05/35
(b)
..................
255
261,985
14,480,150
Total
Non-Agency
Mortgage-Backed
Securities
—
12
.4
%
(Cost:
$
15,656,326
)
...............................
15,651,442
U.S.
Government
Sponsored
Agency
Securities
Collateralized
Mortgage
Obligations
—
5.5%
Federal
Home
Loan
Mortgage
Corp.
,
Series
5544
,
Class
HV
,
5.00
%
,
05/25/36
........
110
111,014
Federal
Home
Loan
Mortgage
Corp.
Variable
Rate
Notes
(b)
Series
5468
,
Class
FM
,
(SOFR
30
day
Average
at
1.20%
Floor
and
6.50%
Cap
+
1.20%),
4.86
%
,
11/25/54
............
603
605,730
Series
5468
,
Class
MF
,
(SOFR
30
day
Average
at
1.30%
Floor
and
6.50%
Cap
+
1.30%),
4.96
%
,
11/25/54
............
466
469,100
Series
5471
,
Class
FM
,
(SOFR
30
day
Average
at
1.40%
Floor
and
6.50%
Cap
+
1.40%),
5.06
%
,
11/25/54
............
513
516,096
Federal
National
Mortgage
Association
Series
1996-48
,
Class
Z
,
7.00
%
,
11/25/26
..
—
(d)
1
Series
2011-8
,
Class
ZA
,
4.00
%
,
02/25/41
..
552
536,250
Series
2022-25
,
Class
KL
,
4.00
%
,
05/25/52
.
200
183,781
Series
2025-33
,
Class
DV
,
5.50
%
,
04/25/36
.
328
338,005
Series
2025-40
,
Class
EV
,
5.00
%
,
06/25/36
.
104
105,292
Security
Par
(000)
Par
(000)
Value
Collateralized
Mortgage
Obligations
(continued)
Federal
National
Mortgage
Association
Variable
Rate
Notes
(b)
Series
2018-32
,
Class
PS
,
(SOFR
30
day
Average
at
0.00%
Floor
and
7.23%
Cap
+
7.10%),
2.83
%
,
05/25/48
...........
USD
878
$
744,687
Series
2025-2
,
Class
FG
,
(SOFR
30
day
Average
at
1.45%
Floor
and
6.50%
Cap
+
1.45%),
5.11
%
,
02/25/55
............
138
139,675
Series
2025-35
,
Class
FJ
,
(SOFR
30
day
Average
at
1.60%
Floor
and
6.50%
Cap
+
1.60%),
5.26
%
,
05/25/55
...........
179
181,051
Government
National
Mortgage
Association
Variable
Rate
Notes
,
Series
2015-55
,
Class
A
,
5.39
%
,
03/16/36
(b)
..................
2,970
3,052,286
6,982,968
Interest
Only
Collateralized
Mortgage
Obligations
—
7.6%
Federal
Home
Loan
Mortgage
Corp.
Series
5052
,
Class
KI
,
4.00
%
,
12/25/50
....
9,407
1,903,462
Series
5119
,
Class
IC
,
4.00
%
,
06/25/51
....
1,365
275,190
Federal
National
Mortgage
Association
Series
2013-10
,
Class
PI
,
3.00
%
,
02/25/43
.
49
5,794
Series
2020-27
,
Class
IJ
,
4.50
%
,
05/25/50
..
2,356
443,537
Series
2021-23
,
Class
CI
,
3.50
%
,
07/25/46
.
611
108,539
Series
2021-41
,
3.50
%
,
07/25/51
........
1,174
208,502
Federal
National
Mortgage
Association
Variable
Rate
Notes
,
Series
2015-66
,
Class
AS
,
(SOFR
30
day
Average
at
0.00%
Floor
and
6.25%
Cap
+
6.14%),
2.47
%
,
09/25/45
(b)
...
1,719
97,422
Government
National
Mortgage
Association
Series
2020-146
,
3.50
%
,
10/20/50
.......
1,057
198,569
Series
2020-149
,
Class
IA
,
2.50
%
,
10/20/50
.
15,080
2,280,350
Series
2020-151
,
Class
MI
,
2.50
%
,
10/20/50
2,084
303,167
Series
2021-87
,
Class
NI
,
3.00
%
,
05/20/51
.
1,226
203,940
Series
2021-104
,
Class
IH
,
3.00
%
,
06/20/51
1,048
175,321
Series
2021-149
,
Class
KI
,
3.00
%
,
08/20/51
.
1,851
308,696
Series
2021-159
,
Class
IH
,
3.00
%
,
09/20/51
6,758
1,168,966
Series
2021-193
,
Class
IA
,
3.00
%
,
11/20/51
.
2,538
417,109
Series
2022-5
,
Class
LI
,
3.50
%
,
01/20/52
..
293
54,406
Series
2022-127
,
Class
IA
,
3.50
%
,
03/20/52
.
6,068
1,219,686
Government
National
Mortgage
Association
Variable
Rate
Notes
,
Series
2024-6
,
Class
ES
,
(SOFR
30
day
Average
at
0.00%
Floor
and
6.05%
Cap
+
6.05%),
2.38
%
,
07/20/53
(b)
2,585
180,467
9,553,123
Interest
Only
Commercial
Mortgage-Backed
Securities
—
0.4%
(b)
Federal
Home
Loan
Mortgage
Corp.
Multifamily
Structured
Pass-Through
Certificates
Variable
Rate
Notes
Series
K116
,
Class
X1
,
1.41
%
,
07/25/30
...
1,093
53,447
Series
K119
,
Class
X1
,
0.92
%
,
09/25/30
...
1,750
59,736
Series
K122
,
Class
X1
,
0.87
%
,
11/25/30
...
2,694
89,635
Government
National
Mortgage
Association
Variable
Rate
Notes
Series
2016-151
,
0.88
%
,
06/16/58
.......
5,112
231,984
Series
2017-61
,
0.69
%
,
05/16/59
........
1,034
34,761
469,563
Mortgage-Backed
Securities
—
151.3%
Federal
Home
Loan
Mortgage
Corp.
3.00
%
,
06/01/35
-
07/01/35
............
340
324,941
3.50
%
,
07/01/26
-
09/01/26
............
—
(d)
408
4.00
%
,
05/01/26
...................
—
(d)
472
5.00
%
,
05/01/35
-
12/01/38
............
28
28,602
5.65
%
,
05/01/37
-
12/01/37
............
474
487,570
5.75
%
,
08/01/37
-
12/01/37
............
436
448,143
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
6
(Percentages
shown
are
based
on
Net
Assets)
Security
Par
(000)
Par
(000)
Value
Mortgage-Backed
Securities
(continued)
7.50
%
,
03/01/27
...................
USD
—
(d)
$
3
Federal
National
Mortgage
Association
3.50
%
,
11/01/46
...................
471
447,118
4.45
%
,
03/01/36
-
06/01/36
............
249
246,259
4.94
%
,
01/01/35
-
05/01/35
............
120
119,216
5.00
%
,
04/01/36
...................
62
61,373
5.20
%
,
08/01/34
-
09/01/34
............
94
93,740
5.25
%
,
08/01/37
-
09/01/37
............
249
246,065
5.54
%
,
01/01/35
...................
49
48,772
5.75
%
,
04/01/37
...................
220
216,674
5.80
%
,
07/01/34
...................
32
31,713
5.94
%
,
09/01/34
...................
44
43,913
6.50
%
,
09/01/28
-
02/01/31
............
217
219,657
Government
National
Mortgage
Association
2.00
%
,
04/15/56
(e)
..................
7,684
6,345,903
2.50
%
,
11/20/40
-
03/20/41
............
445
401,333
2.50
%
,
04/15/56
(e)
..................
5,049
4,342,929
3.00
%
,
05/15/42
-
01/20/50
............
1,857
1,670,997
3.00
%
,
04/15/56
(e)
..................
3,013
2,689,384
3.50
%
,
07/15/43
-
02/15/45
............
3,034
2,852,890
4.00
%
,
12/20/43
-
12/20/47
............
1,361
1,278,661
4.00
%
,
04/15/56
(e)
..................
1,371
1,284,046
4.50
%
,
12/15/34
-
09/15/43
............
1,238
1,217,808
4.50
%
,
04/15/56
(e)
..................
1,472
1,421,807
5.00
%
,
12/15/32
-
05/20/50
............
2,378
2,388,975
5.00
%
,
04/15/56
(e)
..................
1,459
1,444,851
5.50
%
,
03/15/32
-
07/20/55
............
1,992
2,033,519
5.50
%
,
04/15/56
(e)
..................
2,481
2,496,801
5.64
%
,
04/15/37
-
06/15/37
............
788
820,028
5.65
%
,
05/20/37
-
10/20/37
............
360
366,460
5.75
%
,
08/20/37
-
12/20/37
............
256
260,568
5.80
%
,
11/15/36
-
03/15/37
............
627
645,275
6.00
%
,
01/15/39
-
07/20/55
............
4,828
5,021,149
6.00
%
,
04/15/56
(e)
..................
492
500,269
6.50
%
,
09/20/27
-
06/20/55
............
5,773
6,054,093
6.50
%
,
04/15/56
(e)
..................
471
489,478
7.00
%
,
05/20/27
-
06/20/55
............
502
523,820
7.50
%
,
07/20/54
...................
579
610,334
8.00
%
,
06/15/26
-
05/15/30
............
2
1,857
Uniform
Mortgage-Backed
Securities
2.00
%
,
04/25/41
-
04/25/56
(e)
...........
28,718
23,859,693
2.50
%
,
04/25/41
-
05/25/56
(e)
...........
37,712
31,838,455
3.00
%
,
04/25/41
-
04/25/56
(e)
...........
1,414
1,284,285
3.00
%
,
03/01/43
-
04/01/52
............
7,700
6,925,751
3.50
%
,
04/25/41
-
05/25/56
(e)
...........
3,152
2,899,401
3.50
%
,
03/01/43
-
08/01/50
............
3,025
2,830,095
4.00
%
,
04/25/41
-
04/25/56
(e)
...........
2,255
2,135,337
4.00
%
,
01/01/45
-
08/01/51
............
2,061
1,986,491
4.50
%
,
04/25/41
-
04/25/56
(e)
...........
4,915
4,778,104
4.50
%
,
09/01/48
-
06/01/53
............
2,822
2,784,681
5.00
%
,
07/01/34
-
01/01/56
............
8,665
8,601,271
5.00
%
,
04/25/56
-
05/25/56
(e)
...........
15,539
15,319,926
5.25
%
,
07/01/37
-
08/01/37
............
291
295,814
5.50
%
,
12/01/32
-
11/01/54
............
7,993
8,087,854
5.50
%
,
04/25/56
(e)
..................
9,109
9,150,955
6.00
%
,
11/01/52
-
10/01/55
............
7,215
7,446,291
6.00
%
,
04/25/56
-
05/25/56
(e)
...........
5,923
6,033,483
6.50
%
,
08/01/35
-
07/01/54
............
2,716
2,823,118
6.50
%
,
04/25/56
(e)
..................
928
960,020
190,268,899
Principal
Only
Collateralized
Mortgage
Obligations
—
1.6%
(f)
Federal
National
Mortgage
Association
,
Series
2024-16
,
0.00
%
,
03/25/51
.............
727
519,770
Government
National
Mortgage
Association
Series
2022-195
,
0.00
%
,
11/20/52
.......
118
95,064
Security
Par
(000)
Par
(000)
Value
Principal
Only
Collateralized
Mortgage
Obligations
(continued)
Series
2023-130
,
Class
OD
,
0.00
%
,
09/20/53
USD
1,562
$
1,378,718
1,993,552
Total
U.S.
Government
Sponsored
Agency
Securities
—
166
.4
%
(Cost:
$
210,672,769
)
..............................
209,268,105
Total
Long-Term
Investments
—
178.8%
(Cost:
$
226,329,095
)
..............................
224,919,547
Shares
Shares
Short-Term
Securities
Money
Market
Funds
—
18.1%
BlackRock
Liquidity
Funds,
T-Fund,
Institutional
Class
,
3.55
%
(g)
(h)
...................
22,766,234
22,766,234
Total
Short-Term
Securities
—
18
.1
%
(Cost:
$
22,766,234
)
...............................
22,766,234
Total
Options
Purchased
—
0.0
%
(
Cost:
$
132,853
)
.................................
125,943
Total
Investments
Before
Options
Written
and
TBA
Sale
Commitments
—
196
.9
%
(Cost:
$
249,228,182
)
..............................
247,811,724
Total
Options
Written
—
(
0
.3
)
%
(Premium
Received
—
$
(
397,023
)
)
....................
(
430,648
)
Par
(000)
Pa
r
(
000)
TBA
Sale
Commitments
(e)
Mortgage-Backed
Securities
—
(
42
.0
)
%
Government
National
Mortgage
Association
2.00
%
,
04/15/56
...................
(
31
)
(
25,602
)
2.50
%
,
04/15/56
...................
(
26
)
(
22,364
)
3.50
%
,
04/15/56
...................
(
245
)
(
224,679
)
4.00
%
,
04/15/56
...................
(
1,251
)
(
1,171,657
)
5.50
%
,
04/15/56
...................
(
44
)
(
44,280
)
6.00
%
,
04/15/56
...................
(
68
)
(
69,143
)
6.50
%
,
04/15/56
...................
(
27
)
(
28,059
)
Uniform
Mortgage-Backed
Securities
2.00
%
,
04/25/41
-
04/25/56
............
(
272
)
(
227,720
)
2.50
%
,
04/25/41
-
04/25/56
............
(
17,987
)
(
15,122,607
)
3.00
%
,
04/25/41
-
04/25/56
............
(
2,346
)
(
2,061,821
)
3.50
%
,
04/25/41
-
04/25/56
............
(
85
)
(
78,144
)
4.50
%
,
04/25/41
-
04/25/56
............
(
2,492
)
(
2,405,767
)
5.00
%
,
04/25/41
-
05/25/56
............
(
26,002
)
(
25,634,421
)
4.00
%
,
04/25/56
-
05/25/56
............
(
4,078
)
(
3,846,114
)
5.50
%
,
04/25/56
...................
(
125
)
(
125,576
)
6.00
%
,
04/25/56
...................
(
1,630
)
(
1,661,505
)
6.50
%
,
04/25/56
...................
(
146
)
(
151,038
)
Total
TBA
Sale
Commitments
—
(
42
.0
)
%
(Proceeds:
$
(
53,120,311
)
)
..........................
(
52,900,497
)
Total
Investments
Net
of
Options
Written
and
TBA
Sale
Commitments
—
154
.6
%
(Cost:
$
195,710,848
)
..............................
194,480,579
Liabilities
in
Excess
of
Other
Assets
—
(
54.6
)
%
............
(
68,696,669
)
Net
Assets
—
100.0%
...............................
$
125,783,910
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
Schedule
of
Investments
7
Affiliates
Investments
in
issuers
considered
to
be
affiliate(s)
of
the
Fund
during
the six
months
ended
March
31,
2026
for
purposes
of
Section
2(a)(3)
of
the
Investment
Company
Act
of
1940,
as
amended,
were
as
follows:
(a)
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.
(b)
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.
(c)
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.
(d)
Rounds
to
less
than
1,000.
(e)
Represents
or
includes
a
TBA
transaction.
(f)
Zero-coupon
bond.
(g)
Affiliate
of
the
Fund.
(h)
Annualized
7-day
yield
as
of
period
end.
Affiliated
Issuer
Value
at
09/30/25
Purchases
at
Cost
Proceeds
from
Sales
Net
Realized
Gain
(Loss)
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
03/31/26
Shares
Held
at
03/31/26
Income
Capital
Gain
Distributions
from
Underlying
Funds
BlackRock
Liquidity
Funds,
T-Fund,
Institutional
Class
.
$
1,092,521
$
21,673,713
(a)
$
—
$
—
$
—
$
22,766,234
22,766,234
$
51,180
$
—
—
—
(a)
Represents
net
amount
purchased
(sold).
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
8
Derivative
Financial
Instruments
Outstanding
as
of
Period
End
Futures
Contracts
Description
Number
of
Contracts
Expiration
Date
Notional
Amount
(000)
Value/
Unrealized
Appreciation
(Depreciation)
Long
Contracts
U.S.
Treasury
Long
Bond
.....................................................
25
06/18/26
$
2,841
$
(
12,241
)
Short
Contracts
U.S.
Treasury
10-Year
Note
...................................................
56
06/18/26
6,215
2,229
U.S.
Treasury
10-Year
Ultra
Note
...............................................
13
06/18/26
1,475
27,400
U.S.
Treasury
2-Year
Note
....................................................
5
06/30/26
1,037
(
22
)
U.S.
Treasury
5-Year
Note
....................................................
2
06/30/26
216
(
1,034
)
28,573
$
16,332
OTC
Interest
Rate
Swaptions
Purchased
Paid
by
the
Fund
Received
by
the
Fund
Description
Rate
Frequency
Rate
Frequency
Counterparty
Expiration
Date
Exercise
Rate
Notional
Amount
(000)
Value
Call
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
4.11%
Annual
Deutsche
Bank
AG
03/27/28
4
.11
%
USD
860
$
33,671
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
4.05%
Annual
Deutsche
Bank
AG
03/30/28
4
.05
USD
860
31,524
65,195
Put
10-Year
Interest
Rate
Swap
(a)
4.11%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
03/27/28
4
.11
USD
860
29,404
10-Year
Interest
Rate
Swap
(a)
4.05%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
03/30/28
4
.05
USD
860
31,344
60,748
$
125,943
(a)
Forward
settling
swaption.
OTC
Interest
Rate
Swaptions
Written
Paid
by
the
Fund
Received
by
the
Fund
Description
Rate
Frequency
Rate
Frequency
Counterparty
Expiration
Date
Exercise
Rate
Notional
Amount
(000)
Value
Call
10-Year
Interest
Rate
Swap
(a)
3.73%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
09/09/26
3
.73
%
USD
823
$
(
10,325
)
10-Year
Interest
Rate
Swap
(a)
3.72%
Annual
1-day
SOFR
Annual
Citibank
NA
09/10/26
3
.72
USD
824
(
10,133
)
10-Year
Interest
Rate
Swap
(a)
3.71%
Annual
1-day
SOFR
Annual
Citibank
NA
03/04/27
3
.71
USD
431
(
7,709
)
10-Year
Interest
Rate
Swap
(a)
3.88%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
03/15/27
3
.88
USD
1,252
(
30,159
)
10-Year
Interest
Rate
Swap
(a)
4.10%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
01/31/28
4
.10
USD
734
(
28,264
)
10-Year
Interest
Rate
Swap
(a)
4.11%
Annual
1-day
SOFR
Annual
Deutsche
Bank
AG
01/31/28
4
.11
USD
2,708
(
104,501
)
(
191,091
)
Put
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
3.73%
Annual
Deutsche
Bank
AG
09/09/26
3
.73
USD
823
(
21,989
)
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
3.72%
Annual
Citibank
NA
09/10/26
3
.72
USD
824
(
22,467
)
2-Year
Interest
Rate
Swap
(a)
.
1-day
SOFR
Annual
3.60%
Annual
Barclays
Bank
plc
09/14/26
3
.60
USD
5,659
(
30,460
)
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
3.71%
Annual
Citibank
NA
03/04/27
3
.71
USD
431
(
15,697
)
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
3.88%
Annual
Deutsche
Bank
AG
03/15/27
3
.88
USD
1,252
(
36,682
)
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
4.10%
Annual
Deutsche
Bank
AG
01/31/28
4
.10
USD
734
(
23,981
)
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
Schedule
of
Investments
9
Derivative
Financial
Instruments
Categorized
by
Risk
Exposure
OTC
Interest
Rate
Swaptions
Written
(continued)
Paid
by
the
Fund
Received
by
the
Fund
Description
Rate
Frequency
Rate
Frequency
Counterparty
Expiration
Date
Exercise
Rate
Notional
Amount
(000)
Value
10-Year
Interest
Rate
Swap
(a)
1-day
SOFR
Annual
4.11%
Annual
Deutsche
Bank
AG
01/31/28
4
.11
%
USD
2,708
$
(
88,281
)
(
239,557
)
$
(
430,648
)
(a)
Forward
settling
swaption.
The
following
reference
rates,
and
their
values
as
of
period
end,
are
used
for
security
descriptions:
Reference
Index
Reference
Rate
1-day
SOFR
.........................................
Secured
Overnight
Financing
Rate
3
.65
%
Balances
Reported
in
the
Statement
of
Assets
and
Liabilities
for
Options
Written
Description
Swap
Premiums
Paid
Swap
Premiums
Received
Unrealized
Appreciation
Unrealized
Depreciation
Value
Options
Written
...................................................
N/A
N/A
$
16,789
$
(
50,414
)
$
(
430,648
)
As
of
period
end,
the
fair
values
of
derivative
financial
instruments
located
in
the
Statement
of
Assets
and
Liabilities
were
as
follows:
Commodity
Contracts
Credit
Contracts
Equity
Contracts
Foreign
Currency
Exchange
Contracts
Interest
Rate
Contracts
Other
Contracts
Total
Assets
—
Derivative
Financial
Instruments
Futures
contracts
Unrealized
appreciation
on
futures
contracts
(a)
......
$
—
$
—
$
—
$
—
$
29,629
$
—
$
29,629
Options
purchased
(b)
Investments
at
value
—
unaffiliated
(c)
............
—
—
—
—
125,943
—
125,943
$
—
$
—
$
—
$
—
$
155,572
$
—
$
155,572
Liabilities
—
Derivative
Financial
Instruments
Futures
contracts
Unrealized
depreciation
on
futures
contracts
(a)
......
$
—
$
—
$
—
$
—
$
13,297
$
—
$
13,297
Options
written
(b)
Options
written
at
value
.....................
—
—
—
—
430,648
—
430,648
$
—
$
—
$
—
$
—
$
443,945
$
—
$
443,945
(a)
Net
cumulative
unrealized
appreciation
(depreciation)
on
futures
contracts,
if
any,
are
reported
in
the
Schedule
of
Investments.
In
the
Statement
of
Assets
and
Liabilities,
only
current
day’s
variation
margin
is
reported
in
receivables
or
payables
and
the
net
cumulative
unrealized
appreciation
(depreciation)
is
included
in
accumulated
earnings
(loss).
(b)
Includes
forward
settling
swaptions.
(c)
Includes
options
purchased
at
value
as
reported
in
the
Schedule
of
Investments.
For
the
period
ended
March
31,
2026,
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
c
ontracts
.......................
$
—
$
—
$
—
$
—
$
(
7,493
)
$
—
$
(
7,493
)
Options
purchased
(a)
.....................
—
—
—
—
(
51,915
)
—
(
51,915
)
Options
written
........................
—
—
—
—
16,703
—
16,703
$
—
$
—
$
—
$
—
$
(42,705)
$
—
$
(42,705)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
10
For
more
information
about
the
Fund’s
investment
risks
regarding
derivative
financial
instruments,
refer
to
the
Notes
to
Financial
Statements.
Derivative
Financial
Instruments
—
Offsetting
as
of
Period
End
Commodity
Contracts
Credit
Contracts
Equity
Contracts
Foreign
Currency
Exchange
Contracts
Interest
Rate
Contracts
Other
Contracts
Total
Net
Change
in
Unrealized
Appreciation
(Depreciation)
on
Futures
c
ontracts
.......................
$
—
$
—
$
—
$
—
$
(
79,338
)
$
—
$
(
79,338
)
Options
purchased
(b)
.....................
—
—
—
—
26,084
—
26,084
Options
written
........................
—
—
—
—
(
33,625
)
—
(
33,625
)
$
—
$
—
$
—
$
—
$
(86,879)
$
—
$
(86,879)
(a)
Options
purchased
are
included
in
net
realized
gain
(loss)
from
investments
—
unaffiliated.
(b)
Options
purchased
are
included
in
net
change
in
unrealized
appreciation
(depreciation)
on
investments
—
unaffiliated.
Average
Quarterly
Balances
of
Outstanding
Derivative
Financial
Instruments
Futures
contracts
Average
notional
value
of
contracts
—
long
..................................................................................
$
2,345,062
Average
notional
value
of
contracts
—
short
.................................................................................
12,463,618
Options
Average
notional
value
of
swaption
contracts
purchased
.........................................................................
1,719,781
Average
notional
value
of
swaption
contracts
written
...........................................................................
13,628,880
The
Fund's
derivative
assets
and
liabilities
(by
type)
were
as
follows:
Assets
Liabilities
Derivative
Financial
Instruments
$
—
Futures
contracts
....................................................................................
$
9,375
$
20,229
Options
(a)
(b)
........................................................................................
125,943
430,648
Total
derivative
assets
and
liabilities
in
the
Statement
of
Assets
and
Liabilities
.............................................
$
135,318
$
450,877
Derivatives
not
subject
to
a
Master
Netting
Agreement
or
similar
agreement
("MNA")
........................................
(
9,375
)
(
20,229
)
Total
derivative
assets
and
liabilities
subject
to
an
MNA
............................................................
$
125,943
$
430,648
(a)
Includes
options
purchased
at
value
which
is
included
in
Investments
at
value
–
unaffiliated
in
the
Statement
of
Assets
and
Liabilities
and
reported
in
the
Schedule
of
Investments.
(b)
Includes
forward
settling
swaptions.
The
following
tables
present
the
Fund's
derivative
assets
and
liabilities
by
counterparty
net
of
amounts
available
for
offset
under
an
MNA
and
net
of
the
related
collateral
received
and
pledged
by
the
Fund:
Counterparty
Derivative
Assets
Subject
to
an
MNA
by
Counterparty
Derivatives
Available
for
Offset
(a)
Non-cash
Collateral
Received
Cash
Collateral
Received
Net
Amount
of
Derivative
Assets
Deutsche
Bank
AG
................................
$
125,943
$
(
125,943
)
$
—
$
—
$
—
Counterparty
Derivative
Liabilities
Subject
to
an
MNA
by
Counterparty
Derivatives
Available
for
Offset
(a)
Non-cash
Collateral
Pledged
Cash
Collateral
Pledged
Net
Amount
of
Derivative
Liabilities
(b)
Barclays
Bank
plc
................................
$
30,460
$
—
$
—
$
—
$
30,460
Citibank
NA
.....................................
56,006
—
—
—
56,006
Deutsche
Bank
AG
................................
344,182
(
125,943
)
—
—
218,239
$
430,648
$
(
125,943
)
$
—
$
—
$
304,705
(a)
The
amount
of
derivatives
available
for
offset
is
limited
to
the
amount
of
derivative
assets
and/or
liabilities
that
are
subject
to
an
MNA.
(b)
Net
amount
represents
the
net
amount
payable
due
to
the
counterparty
in
the
event
of
default.
Net
amount
may
be
offset
further
by
the
options
receivable/payable
on
the
Statement
of
Assets
and
Liabilities.
Schedule
of
Investments
(unaudited)
(continued)
March
31,
2026
iShares
Mortgage-Backed
Securities
Active
ETF
Schedule
of
Investments
11
Fair
Value
Hierarchy
as
of Period
End
Various
inputs
are
used
in
determining
the
fair
value
of
financial
instruments
at
the
measurement
date.
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.
See
notes
to
financial
statements.
Level
1
Level
2
Level
3
Total
Assets
Investments
Long-Term
Investments
Non-Agency
Mortgage-Backed
Securities
........................
$
—
$
15,651,442
$
—
$
15,651,442
U.S.
Government
Sponsored
Agency
Securities
....................
—
209,268,105
—
209,268,105
Short-Term
Securities
Money
Market
Funds
......................................
22,766,234
—
—
22,766,234
Options
Purchased
Interest
rate
contracts
......................................
—
125,943
—
125,943
Liabilities
Investments
TBA
Sale
Commitments
....................................
—
(
52,900,497
)
—
(
52,900,497
)
$
22,766,234
$
172,144,993
$
—
$
194,911,227
Derivative
Financial
Instruments
(a)
Assets
Interest
rate
contracts
.......................................
$
29,629
$
—
$
—
$
29,629
Liabilities
Interest
rate
contracts
.......................................
(
13,297
)
(
430,648
)
—
(
443,945
)
$
16,332
$
(
430,648
)
$
—
$
(
414,316
)
(a)
Derivative
financial
instruments
are
futures
contracts
and
options
written.
Futures
contracts
are
valued
at
the
unrealized
appreciation
(depreciation)
on
the
instrument
and
options
written
are
shown
at
value.
Statement
of
Assets
and
Liabilities
(unaudited)

March
31,
2026
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
12
See
notes
to
financial
statements.
iShares
Mortgage-
Backed
Securities
Active
ETF
ASSETS
Investments,
at
value
—
unaffiliated
(a)
........................................................................................
$
225,045,490‌
Investments,
at
value
—
affiliated
(b)
..........................................................................................
22,766,234‌
Cash
pledged:
Futures
contracts
....................................................................................................
88,310‌
Receivables:
–‌
Investment
s
sold
....................................................................................................
346,272‌
Options
written
......................................................................................................
68,109‌
TBA
sale
commitments
................................................................................................
53,120,311‌
Dividends
—
affiliated
.................................................................................................
32,135‌
Interest
—
unaffiliated
.................................................................................................
518,832‌
Variation
margin
on
futures
contracts
.......................................................................................
9,375‌
Prepaid
e
xpenses
.....................................................................................................
801‌
Total
a
ssets
.........................................................................................................
301,995,869‌
LIABILITIES
Bank
overdraft
........................................................................................................
31,711‌
Options
written,
at
value
(c)
................................................................................................
430,648‌
TBA
sale
commitments,
at
value
(d)
..........................................................................................
52,900,497‌
Payables:
–‌
Investments
purchased
................................................................................................
122,457,073‌
Capital
shares
redeemed
...............................................................................................
647‌
Investment
advisory
fees
...............................................................................................
25,466‌
Reorganization
costs
.................................................................................................
345,688‌
Variation
margin
on
futures
contracts
.......................................................................................
20,229‌
Total
li
abilities
........................................................................................................
176,211,959‌
Commitments
and
contingent
liabilities
—‌
NET
ASSETS
........................................................................................................
$
125,783,910‌
NET
ASSETS
CONSIST
OF:
Paid-in
capital
........................................................................................................
$
272,533,462‌
Accumulated
loss
.....................................................................................................
(
146,749,552‌
)
NET
ASSETS
........................................................................................................
$
125,783,910‌
NET
ASSET
VALUE
Shares
outstanding
...................................................................................................
2,524,113‌
Net
asset
value
.....................................................................................................
$
49.83‌
Shares
authorized
...................................................................................................
Unlimited
Par
value
.........................................................................................................
None
(a)
  Investments,
at
cost
—
unaffiliated
.................................................................................
$
226,461,948‌
(b)
  Investments,
at
cost
—
affiliated
...................................................................................
$
22,766,234‌
(c)
  Premiums
received
...........................................................................................
$
397,023‌
(d)
  Proceeds
received
from
TBA
sale
commitments
.........................................................................
$
53,120,311‌
Statement
of
Operations
(unaudited)

Six
Months
Ended
March
31,
2026
13
Statement
of
Operations
See
notes
to
financial
statements.
iShares
Mortgage-
Backed
Securities
Active
ETF
(a)
INVESTMENT
INCOME
–
Dividends
—
affiliated
................................................................................................
$
51,180‌
Interest
—
unaffiliated
................................................................................................
3,996,604‌
Total
investment
income
................................................................................................
4,047,784‌
EXPENSES
Investment
advisory
.................................................................................................
264,296‌
Reorganization
....................................................................................................
144,548‌
Transfer
agent
—
class
specific
.........................................................................................
101,080‌
Registration
......................................................................................................
76,932‌
Service
and
distribution
—
class
specific
...................................................................................
60,019‌
Professional
......................................................................................................
42,751‌
Administration
....................................................................................................
25,697‌
Accounting
services
.................................................................................................
14,568‌
Printing
and
postage
................................................................................................
13,251‌
Administration
—
class
specific
.........................................................................................
12,093‌
Custodian
........................................................................................................
6,545‌
Trustees
and
Officer
.................................................................................................
1,708‌
Interest
expense
...................................................................................................
476‌
Miscellaneous
.....................................................................................................
17,903‌
Total
expenses
......................................................................................................
781,867‌
Less:
–‌
Administration
fees
waived
by
the
Investment
Adviser
..........................................................................
(
1,642‌
)
Administration
fees
waived
by
the
Investment
Adviser
—
class
specific
...............................................................
(
12,093‌
)
Fees
waived
and/or
reimbursed
by
the
Manager
..............................................................................
(
1,701‌
)
Fees
waived
and/or
reimbursed
by
the
Investment
Adviser
.......................................................................
(
177,000‌
)
Service
and
distribution
fees
waived
and/or
reimbursed
by
the
Investment
Adviser
—
class
specific
............................................
(
27,391‌
)
Transfer
agent
fees
waived
and/or
reimbursed
by
the
Investment
Adviser
—
class
specific
..................................................
(
76,787‌
)
Total
ex
penses
after
fees
waived
and/or
reimbursed
.............................................................................
485,253‌
Net
investment
income
.................................................................................................
3,562,531‌
REALIZED
AND
UNREALIZED
GAIN
(LOSS)
$
446,945‌
Net
realized
gain
(loss)
from:
Investments
—
unaffiliated
..........................................................................................
$
(
2,706,343‌
)
Futures
contracts
.................................................................................................
(
7,493‌
)
Options
written
..................................................................................................
16,703‌
(2,697,133‌)
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments
—
unaffiliated
..........................................................................................
3,257,041‌
Futures
contracts
.................................................................................................
(
79,338‌
)
Options
written
..................................................................................................
(
33,625‌
)
3,144,078‌
Net
realized
and
unrealized
gain
..........................................................................................
446,945‌
NET
INCREASE
IN
NET
ASSETS
RESULTING
FROM
OPERATIONS
.................................................................
$
4,009,476‌
(a)
During
the
period,
the
Predecessor
Fund
converted
from
a
mutual
fund
into
an
exchange
traded
fund
pursuant
to
an
Agreement
and
Plan
of
Reorganization.
See
Note
1
of
the
Notes
to
Financial
Statements
for
information
on
the
Predecessor
Fund’s
reorganization.
Statements
of
Changes
in
Net
Assets

2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
14
See
notes
to
financial
statements.
iShares
Mortgage-Backed
Securities
Active
ETF
Six
Months
Ended
03/31/26
(unaudited)
(a)
Year
Ended
09/30/25
INCREASE
(DECREASE)
IN
NET
ASSETS
OPERATIONS
Net
investment
income
..............................................................................
$
3,562,531‌
$
9,829,732‌
Net
realized
loss
..................................................................................
(
2,697,133‌
)
(
18,368,894‌
)
Net
change
in
unrealized
appreciation
(depreciation)
..........................................................
3,144,078‌
15,639,148‌
Net
increase
in
net
assets
resulting
from
operations
.............................................................
4,009,476‌
7,099,986‌
DISTRIBUTIONS
TO
SHAREHOLDERS
(b)
Fund
..........................................................................................
(
790,278‌
)
—‌
Predecessor
Fund
—‌
—‌
Institutional
.....................................................................................
(
1,302,876‌
)
(
4,428,654‌
)
Investor
A
......................................................................................
(
793,900‌
)
(
2,330,754‌
)
Investor
C
......................................................................................
(
57,386‌
)
(
166,565‌
)
Class
K
........................................................................................
(
537,905‌
)
(
3,242,303‌
)
Decrease
in
net
assets
resulting
from
distributions
to
shareholders
...................................................
(3,482,345‌)
(10,168,276‌)
CAPITAL
SHARE
TRANSACTIONS
$
–‌
$
–‌
Net
decrease
in
net
assets
derived
from
capital
share
transactions
...................................................
(97,181,505‌)
(55,753,688‌)
NET
ASSETS
Total
decrease
in
net
assets
............................................................................
(
96,654,374‌
)
(
58,821,978‌
)
Beginning
of
period
..................................................................................
222,438,284‌
281,260,262‌
End
of
period
......................................................................................
$
125,783,910‌
$
222,438,284‌
(a)
During
the
period,
the
Predecessor
Fund
converted
from
a
mutual
fund
into
an
exchange
traded
fund
pursuant
to
an
Agreement
and
Plan
of
Reorganization.
See
Note
1
of
the
Notes
to
Financial
Statements
for
information
on
the
Predecessor
Fund’s
reorganization.
(b)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
Financial
Highlights
(For
a
share
outstanding
throughout
each
period)
15
Financial
Highlights
(a)
As
of
the
close
of
trading
on
the
New
York
Stock
Exchange
on
January
23,
2026,
BlackRock
Mortgage-Backed
Securities
Fund
was
reorganized
into
the
Fund.
The
activity
in
the
table
above
is
for
the
accounting
survivor,
Institutional
Shares
of
BlackRock
Mortgage-Backed
Securities
Fund,
for
the
periods
prior
to
the
date
of
the
reorganization,
and
for
the
post-reorganization
combined
fund
thereafter.
The
net
asset
values
and
other
per
share
information
have
been
restated
for
periods
prior
to
the
reorganization
to
reflect
the
share
conversion
ratio
of
0.161960.
See
Note
1
of
the
Notes
to
Financial
Statements
for
information
on
the
Fund’s
reorganization.
(b)
Based
on
average
shares
outstanding.
(c)
The
amounts
reported
for
a
share
outstanding
may
not
accord
with
the
change
in
aggregate
gains
and
losses
in
securities
for
the
fiscal
period
due
to
the
timing
of
capital
share
transactions
in
relation
to
the
fluctuating
market
values
of
the
Fund’s
underlying
securities.
(d)
Distributions
for
annual
periods
determined
in
accordance
with
U.S.
federal
income
tax
regulations.
(e)
Where
applicable,
assumes
the
reinvestment
of
distributions.
(f)
Not
annualized.
(g)
Excludes
fees
and
expenses
incurred
indirectly
as
a
result
of
investments
in
underlying
funds.
(h)
Annualized.
(i)
Includes
non-recurring
expenses
of
reorganization
costs.
Without
these
costs,
total
expenses
and
total
expenses
after
fees
waived
and/or
reimbursed
would
have
been
0.64%
and  0.35%,
respectively.
(j)
Reorganization
costs
were
not
annualized
in
the
calculation
of
the
expense
ratios.
If
these
expenses
were
annualized,
the
total
expenses
and
total
expenses
after
fees
waived
and/or
reimbursed
would
have
been
0.77%
and
0.48%,
respectively.
(k)
Includes
non-recurring
expenses
of
reorganization
costs.
Without
these
costs,
total
expenses,
total
expenses
after
fees
waived
and/or
reimbursed
and
total
expenses
after
fees
waived
and/or
reimbursed
and
excluding
interest
expense
would
have
been
0.79%,
0.42%
and
0.42%,
respectively.
(l)
Includes
non-recurring
expenses
of
proxy costs.
Without
these
costs,
total
expenses,
total
expenses
after
fees
waived
and/or
reimbursed
and
total
expenses
after
fees
waived
and/or
reimbursed
and
excluding
interest
expense would
have
been
0.72%,
0.55%
and
0.42%,
respectively.
(m)
Includes
mortgage
dollar
roll
transactions
("MDRs").
Additional
information
regarding
portfolio
turnover
rate
is
as
follows:
(n)
Portfolio
turnover
rate
excludes
in-kind
transactions,
if
any.
See
notes
to
financial
statements.
iShares
Mortgage-Backed
Securities
Active
ETF
(a)
Six
Months
Ended
03/31/26
(unaudited)
Year
Ended
09/30/25
Year
Ended
09/30/24
Year
Ended
09/30/23
Year
Ended
09/30/22
Year
Ended
09/30/21
Net
asset
value,
beginning
of
period
..............
$
49.83
‌
$
50.14
‌
$
46.49
‌
$
48.16
‌
$
57.73
‌
$
58.66
‌
Net
investment
income
(b)
......................
1
.04
‌
1
.91
‌
1
.67
‌
1
.48
‌
0
.80
‌
0
.56
‌
Net
realized
and
unrealized
gain
(loss)
(c)
............
(0.02
)
(0.24
)
3.83
‌
(1.54
)
(9.20
)
(0.25
)
Net
increase
(decrease)
from
investment
operations
.....
1.02
‌
1.67
‌
5.50
‌
(0.06
)
(8.40
)
0.31
‌
Distributions
from
net
investment
income
(d)
.........
(1.02
)
(1.98
)
(1.85
)
(1.61
)
(1.17
)
(1.24
)
Net
asset
value,
end
of
period
...................
$
49.83
‌
$
49.83
‌
$
50.14
‌
$
46.49
‌
$
48.16
‌
$
57.73
‌
Total
Return
(e)
Based
on
net
asset
value
.......................
2.06
%
(f)
3.54
%
11.99
%
(0.29
)%
(14.75
)%
0.47
%
Ratios
to
Average
Net
Assets
(g)
Total
expen
ses
..............................
0.70
%
(h)
(i)
(j)
0.85
%
(k)
0.66
%
1.08
%
0.79
%
(l)
0.57
%
Total
expenses
after
fees
waived
and/or
reimbursed
.....
0.41
%
(h)
(i)
(j)
0.48
%
(k)
0.43
%
0.88
%
0.62
%
(l)
0.43
%
Total
expenses
after
fees
waived
and/or
reimbursed
and
excluding
interest
expense
and
reorganization
costs
...
0.34
%
(h)
0.48
%
(k)
0.42
%
0.42
%
0.49
%
(l)
0.43
%
Net
investment
income
.........................
4.13
%
(h)
3.97
%
3.49
%
2.99
%
1.43
%
1.00
%
Supplemental
Data
Net
assets,
end
of
period
(000)
...................
$
125,784
‌
$
93,878
‌
$
123,838
‌
$
147,548
‌
$
203,542
‌
$
363,815
‌
Portfolio
turnover
rate
(m)
(n)
.......................
1,127
%
2,132
%
1,338
%
983
%
1,368
%
1,443
%
Six
Months
Ended
03/31/26
(unaudited)
Year
Ended
09/30/25
Year
Ended
09/30/24
Year
Ended
09/30/23
Year
Ended
09/30/22
Year
Ended
09/30/21
Portfolio
turnover
rate
(excluding
MDRs)
...............................
710%
1,446%
840%
680%
818%
859%
Notes
to
Financial
Statements
(unaudited)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
16
1.
ORGANIZATION
BlackRock
ETF
Trust
II (the
“Trust”)
is
registered
under
the
Investment
Company
Act
of
1940,
as
amended
(the
“1940
Act”),
as
an
open-end
management
company.
The
Trust
is
organized
as
a
Delaware
statutory
trust
and
is
authorized
to
have
multiple
series
or
portfolios.
These
financial
statements
relate
only
to
the
following
fund
(the
“Fund”):
The
Fund,
together
with
certain
other
registered
investment
companies
advised
by
BlackRock
Fund
Advisors
("BFA" or
the
“Manager”) or
its
affiliates,
is
included
in
a
complex
of
funds
referred
to
as
the BlackRock
Fixed-Income
Complex.
Reorganization:
 The
Board
of
Trustees
of
BlackRock
Funds
V (the
“Predecessor
Board”),
on
behalf
of
BlackRock Mortgage-Backed
Securities Fund
(the
“Predecessor
Fund”),
approved
an
Agreement
and
Plan
of
Reorganization
(the
“Reorganization”),
pursuant
to
which
the
Predecessor
Fund
reorganized
into
the
Fund.
The
Reorganization
was
completed
as
of
the
close
of
trading
on
the
New
York
Stock
Exchange
(“NYSE”)
on
January
23,
2026
and
was
not
subject
to
approval
by
shareholders
of
the
Predecessor
Fund.
The
Fund
has
the
same
investment
objective,
strategies
and
policies
and
portfolio
management
team
as
the
Predecessor
Fund.
The
Fund
was
a
newly-formed
“shell”
fund
that
had
not
commenced
operations
prior
to
the
Reorganization
and
therefore
did
not
have
performance
history
prior
to
the
Reorganization.
The
Fund
had
been
organized
solely
in
connection
with
the
Reorganization
to
acquire
all
of
the
assets
and
assume
all
of
the
liabilities
of
the
Predecessor
Fund
and
continue
the
business
of
the
Predecessor
Fund.
In
connection
with
the
Reorganization,
shareholders
of
the
Predecessor
Fund
received
ETF
shares
of
the
Fund
equal
in
value
to
the
number
of
shares
of
the
Predecessor
Fund
they
owned,
including
a
cash
payment
in
lieu
of
fractional
shares
of
the
Fund,
which
the
cash
payment
may
be
taxable.
After
the
Reorganization,
the
Institutional
Share
class
of
the
Predecessor
Fund
was
the
accounting
and
performance
survivor,
meaning
that
the
Fund
assumed
the
performance
and
financial
history
of
the
Predecessor
Fund
upon
completion
of
the
Reorganization.
The
Reorganization was
accomplished
by
a
tax-free
exchange
of
shares
of the Fund
in
the
following
amounts
and
at
the
following
conversion
ratio: 
The
Predecessor
Fund’s
net
assets
and
composition
of
net
assets
as
of
the
close
of
trading
on
the
NYSE
on
January
23,
2026,
the
valuation
date
of
the
Reorganization,
were
as
follows:
For
financial
reporting
purposes,
assets
received
and
shares
issued
by
the
Fund
were
recorded
at
fair
value.
However,
the
cost
basis
of
the
investments
received
from
the
Predecessor
Fund
was
carried
forward
to
the
Fund
to
align
ongoing
reporting
of
the Fund's
realized
and
unrealized
gains
and
losses
with
amounts
distributable
to
shareholders
for
tax
purposes.
Prior
to
the
Reorganization,
the
Fund
had
not
yet
commenced
operations
and
had
no
assets
or
liabilities.
The
Predecessor
Fund's
fair
value
and
cost
of
financial
instruments
prior
to
the
Reorganization
were
as
follows:
Prior
to
the
Reorganization,
the
Predecessor
Fund’s
fiscal
year
end
was
September
30.
The
fiscal
year
end
for
the
Fund
is
April
30.
Effective
as
of
April
30,
2026,
the
Fund’s
fiscal
year
end
is
changed
from
September
30
to
April
30.
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
Fund
Name
Diversification
Classification
iShares
Mortgage-Backed
Securities
Active
ETF
................................................................................
Diversified
Predecessor
Fund’s
Share
Class
Shares
Prior
to
Reorganization
Conversion
Ratio
Shares
of
the
Acquiring
Fund
Institutional
..................................................................
9,2
00
,
500
0.1619
60
1,490,
113
Investor
A
...................................................................
6,192,
361
0.162
668
1,007,
299
Investor
C
...................................................................
469,
689
0.16
1954
76,0
68
Class
K
....................................................................
6
5
,
866
0.16
1434
10,6
33
Net
assets
.........................................................................................................
$
129,229,550
Paid-in-capital
......................................................................................................
275,589,553
Accumulated
loss
....................................................................................................
(146,360,003)
Predecessor
Fund
Fair
Value
of
Investments
Cost
of
Investments
BlackRock
Mortgage-Backed
Securities
Fund
.........................................................................
$
177,304,496‌
$
178,233,906‌
Notes
to
Financial
Statements
(unaudited)
(continued)
17
Notes
to
Financial
Statements
recorded
on
the
ex-dividend
date.
Non-cash
dividends,
if
any,
are
recorded
on
the
ex-dividend
date
at
fair
value.
Interest
income,
including
amortization
and
accretion
of
premiums
and
discounts
on
debt
securities,
is
recognized
daily
on
an
accrual
basis.
Prior
to
January
24,
2026,
income,
expenses
and
realized
and
unrealized
gains
and
losses
were
allocated
daily
to
each
class
of
the
Predecessor
Fund
based
on
its
relative
net
assets.
Cash:
The
Fund
may
maintain
cash
at its
custodian
which,
at
times
may
exceed
United
States
federally
insured
limits.
The
Fund
may,
at
times,
have
outstanding
cash
disbursements
that
exceed
deposited
cash
amounts
at
the
custodian
during
the
reporting
period.
The
Fund is
obligated
to
repay
the
custodian
for
any
overdraft,
including
any
related
costs
or
expenses,
where
applicable.
For
financial
reporting
purposes,
overdraft
fees,
if
any,
are
included
in
interest
expense
in
the
Statement
of
Operations.
Collateralization:
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.  
In-kind
Redemptions:
For
financial
reporting
purposes,
in-kind
redemptions
are
treated
as
sales
of
securities
resulting
in
realized
capital
gains
or
losses
to
the
Fund.
Because
such
gains
or
losses
are
not
taxable
to
the
Fund
and
are
not
distributed
to
existing
Fund
shareholders,
the
gains
or
losses
are
reclassified
from
accumulated
net
realized
gain
(loss)
to
paid-in
capital
at
the
end
of
the
Fund’s
tax
year.
These
reclassifications
have
no
effect
on
net
assets
or
net
asset
value
(“NAV”)
per
share.
Distributions:
Dividends
and
distributions
paid
by
the
Fund
are
recorded
on
the
ex-dividend
dates.
Distributions
are
determined
on
a
tax
basis
and
may
differ
from
net
investment
income
and
net
realized
capital
gains
for
financial
reporting
purposes.
Effective
January
24,
2026,
dividends
and
distributions
are
paid
in
U.S.
dollars,
if
any,
and
cannot
be
automatically
reinvested
in
additional
shares
of
the
Fund.
Deferred
Compensation
Plan:
Under
the
Deferred
Compensation
Plan
(the
“Plan”)
approved
by
the
Predecessor Board,
the
trustees
who
are
not
“interested
persons”
of
the
Predecessor
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
Predecessor
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
Predecessor
Fund
until
such
amounts
are
distributed
in
accordance
with
the
Plan.
Net
appreciation
(depreciation)
in
the
value
of
participants’
deferral
accounts
is
allocated
among
the
participating
funds
in
the
BlackRock
Fixed-Income
Complex
and
reflected
as
Trustees
and
Officer
expense
on
the
Statement
of
Operations.
The
Trustees
and
Officer
expense
may
be
negative
as
a
result
of
a
decrease
in
value
of
the
deferred
accounts.
Reorganization
Costs:
Reorganization
costs
incurred
in
connection
with
the reorganization
were
expensed
by
the
Predecessor
Fund.
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:
Prior
to
January
24,
2026,
expenses
directly
related
to
the
Predecessor
Fund
or
its
classes
were
charged
to
the
Predecessor
Fund
or
the
applicable
class. Expenses
directly
related
to
the
Predecessor
Fund and
other
shared
expenses
prorated
to
the
Predecessor
Fund
were
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
BlackRock
Advisors,
LLC
("BAL"
or
the
"Investment
Adviser"),
were
prorated
among
those
funds
on
the
basis
of
relative
net
assets
or
other
appropriate
methods.  
Segment
Reporting:
The
Fund
adopted
Financial
Accounting
Standards
Board
Update
2023-07,
Segment
Reporting
(Topic
280)
-
Improvements
to
Reportable
Segment
Disclosures
(“ASU
2023-07”)
during
the
period.
The
Fund's
adoption
of
the
new
standard
impacted
financial
statement
disclosures
only
and
did
not
affect
the
Fund's
financial
position
or
results
of
operations.
The
Chief
Financial
Officer
acts
as
the
Fund’s
Chief
Operating
Decision
Maker
(“CODM”)
and
is
responsible
for
assessing
performance
and
allocating
resources
with
respect
to
the
Fund.
The
CODM
has
concluded
that the
Fund
operates
as
a
single
operating
segment
since the
Fund
has
a
single
investment
strategy
as
disclosed
in
its
prospectus,
against
which
the
CODM
assesses
performance.
The
financial
information
provided
to
and
reviewed
by
the
CODM
is
presented
within
the
Fund’s
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's
listing
exchange
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
Board
has
approved
the
designation
of
BFA
as
the
valuation
designee
for
the
Fund.
The
Fund
determines
the
fair
values
of
its
financial
instruments
using
various
independent
dealers
or
pricing
services
under BFA's
policies.
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 BFA's
policies
and
procedures
as
reflecting
fair
value. BFA
has
formed
a
committee
(the
“Valuation
Committee”)
to
develop
pricing
policies
and
procedures
and
to
oversee
the
pricing
function
for
all
financial
instruments,
with
assistance
from
other
BlackRock
pricing
committees.
Fair
Value
Inputs
and
Methodologies:
The
following
methods
and
inputs
are
used
to
establish
the
fair
value
of
the
Fund’s
assets
and
liabilities: 
Fixed-income investments
and
certain
derivative
instruments for
which
market
quotations
are
readily
available
are
generally
valued
using
the
last
available
bid
price
(including
evaluated
prices) provided
by
independent
dealers
or
third-party
pricing
services. 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
of
securities
in
certain
asset
classes
may
trade
at
lower
prices
than
institutional
round
lots,
and
the
value
ultimately
realized
when
the
securities
are
sold
could
differ
from
the
prices
used
by
a
fund.
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
Notes
to
Financial
Statements
(unaudited)
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
18
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
NAV.
Futures
contracts
are valued
based
on
that
day’s
last
reported
settlement
or
trade price
on
the
exchange
where
the
contract
is
traded.
Exchange-traded
options
(except
ETF
options,
equity
index
options
or
those
that
are
customized)
are
valued
at
the
mean
between
the
last bid
and
ask
prices
at
the
close
of
the
options
market in
which
the
options
trade.
An
exchange-traded
option
for
which there
is
no
mean
price
is
valued
at
the
last
bid
(long
positions)
or
ask
(short
positions)
price.
If
no
bid
or
ask
price
is
available,
the
prior
day’s
price will
be
used,
unless
it
is
determined
that
the
prior
day’s
price
no
longer
reflects
the
fair
value
of
the
option.
Customized
exchange-traded
equity
options,
ETF
options,
equity
index
options
and
over-the-counter
(“OTC”)
options
and
options
on
swaps
(“swaptions”)
are
valued
by
an
independent
pricing
service
using
a
mathematical
model,
which
incorporates
a
number
of
market
data
factors,
such
as
the
trades
and
prices
of
the
underlying
instruments.
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 Valuation
Committee
in
accordance
with
BFA’s
policies
and
procedures as
reflecting
fair
value
(“Fair
Valued
Investments”).
The
fair
valuation
approaches
that
may
be
used
by
the 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 Valuation
Committee
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 Valuation
Committee
deems
relevant
and
consistent
with
the
principles
of
fair
value
measurement
as
of
the
measurement
date.
Fair
Value
Hierarchy:
Various
inputs
are
used
in
determining
the
fair
value
of
financial
instruments
at
the
measurement
date.
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
that
the
Fund
has
the
ability
to
access
for
identical
assets
or
liabilities;
Level
2
—
Inputs
other
than
quoted
prices
included
within
Level
1
that
are
observable
for
the
asset
or
liability,
either
directly
or
indirectly;
and
Level
3 —
Inputs
that
are
unobservable
and
significant
to
the
entire
fair
value
measurement
for the
asset
or
liability
(including
the
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 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 
Asset-Backed
and
Mortgage-Backed
Securities:
Asset-backed
securities
are
generally
issued
as
pass-through
certificates
or
as
debt
instruments.
Asset-backed
securities
issued
as
pass-through
certificates
represent
undivided
fractional
ownership
interests
in
an
underlying
pool
of
assets.
Asset-backed
securities
issued
as
debt
instruments,
which
are
also
known
as
collateralized
obligations,
are
typically
issued
as
the
debt
of
a
special
purpose
entity
organized
solely
for
the
purpose
of
owning
such
assets
and
issuing
such
debt.
Asset-backed
securities
are
often
backed
by
a
pool
of
assets
representing
the
obligations
of
a
number
of
different
parties.
The
yield
characteristics
of
certain
asset-backed
securities
may
differ
from
traditional
debt
securities.
One
such
major
difference
is
that
all
or
a
principal
part
of
the
obligations
may
be
prepaid
at
any
time
because
the
underlying
assets
(i.e.,
loans)
may
be
prepaid
at
any
time.
As
a
result,
a
decrease
in
interest
rates
in
the
market
may
result
in
increases
in
the
level
of
prepayments
as
borrowers,
particularly
mortgagors,
refinance
and
repay
their
loans.
An
increased
prepayment
rate
with
respect
to
an
asset-backed
security
will
have
the
effect
of
shortening
the
maturity
of
the
security.
In
addition,
a
fund
may
subsequently
have
to
reinvest
the
proceeds
at
lower
interest
rates.
If
a
fund
has
purchased
such
an
asset-backed
security
at
a
premium,
a
faster
than
anticipated
prepayment
rate
could
result
in
a
loss
of
principal
to
the
extent
of
the
premium
paid.
For
mortgage
pass-through
securities
(the
“Mortgage
Assets”)
there
are
a
number
of
important
differences
among
the
agencies
and
instrumentalities
of
the
U.S.
Government
that
issue
mortgage-related
securities
and
among
the
securities
that
they
issue.
For
example,
mortgage-related
securities
guaranteed
by
Ginnie
Mae
are
guaranteed
as
to
the
timely
payment
of
principal
and
interest
by
Ginnie
Mae
and
such
guarantee
is
backed
by
the
full
faith
and
credit
of
the
United
States.
However,
mortgage-related
securities
issued
by
Freddie
Mac
and
Fannie
Mae,
including
Freddie
Mac
and
Fannie
Mae
guaranteed
mortgage
pass-through
certificates,
which
are
solely
the
obligations
of
Freddie
Mac
and
Fannie
Mae,
are
not
backed
by
or
entitled
to
the
full
faith
and
credit
of
the
United
States,
but
are
supported
by
the
right
of
the
issuer
to
borrow
from
the
U.S.
Treasury.
Non-agency
mortgage-backed
securities
are
securities
issued
by
non-governmental
issuers
and
have
no
direct
or
indirect
government
guarantees
of
payment
and
are
subject
to
various
risks.
Non-agency
mortgage
loans
are
obligations
of
the
borrowers
thereunder
only
and
are
not
typically
insured
or
guaranteed
by
any
other
person
or
entity.
The
ability
of
a
borrower
to
repay
a
loan
is
dependent
upon
the
income
or
assets
of
the
borrower.
A
number
of
factors,
including
a
general
economic
downturn,
acts
of
God,
terrorism,
social
unrest
and
civil
disturbances,
may
impair
a
borrower’s
ability
to
repay
its
loans.
Notes
to
Financial
Statements
(unaudited)
(continued)
19
Notes
to
Financial
Statements
Multiple
Class
Pass-Through
Securities:
Multiple
class
pass-through
securities,
including
collateralized
mortgage
obligations
(“CMOs”)
and
commercial
mortgage-backed
securities,
may
be
issued
by
Ginnie
Mae,
U.S.
Government
agencies
or
instrumentalities
or
by
trusts
formed
by
private
originators
of,
or
investors
in,
mortgage
loans.
In
general,
CMOs
are
debt
obligations
of
a
legal
entity
that
are
collateralized
by
a
pool
of
residential
or
commercial
mortgage
loans
or
Mortgage
Assets.
The
payments
on
these
are
used
to
make
payments
on
the
CMOs
or
multiple
pass-through
securities.
Multiple
class
pass-through
securities
represent
direct
ownership
interests
in
the
Mortgage
Assets.
Classes
of
CMOs
include
interest
only
(“IOs”),
principal
only
(“POs”),
planned
amortization
classes
and
targeted
amortization
classes.
IOs
and
POs
are
stripped
mortgage-backed
securities
representing
interests
in
a
pool
of
mortgages,
the
cash
flow
from
which
has
been
separated
into
interest
and
principal
components.
IOs
receive
the
interest
portion
of
the
cash
flow
while
POs
receive
the
principal
portion.
IOs
and
POs
can
be
extremely
volatile
in
response
to
changes
in
interest
rates.
As
interest
rates
rise
and
fall,
the
value
of
IOs
tends
to
move
in
the
same
direction
as
interest
rates.
POs
perform
best
when
prepayments
on
the
underlying
mortgages
rise
since
this
increases
the
rate
at
which
the
principal
is
returned
and
the
yield
to
maturity
on
the
PO.
When
payments
on
mortgages
underlying
a
PO
are
slower
than
anticipated,
the
life
of
the
PO
is
lengthened
and
the
yield
to
maturity
is
reduced.
If
the
underlying
Mortgage
Assets
experience
greater
than
anticipated
prepayments
of
principal,
a
fund’s
initial
investment
in
the
IOs
may
not
fully
recoup. 
Stripped
Mortgage-Backed
Securities:
Stripped
mortgage-backed
securities
are
typically
issued
by
the
U.S.
Government,
its
agencies
and
instrumentalities.
Stripped
mortgage-backed
securities
are
usually
structured
with
two
classes
that
receive
different
proportions
of
the
interest
(IOs)
and
principal
(POs)
distributions
on
a
pool
of
Mortgage
Assets.
Stripped
mortgage-backed
securities
may
be
privately
issued.
Zero-Coupon
Bonds:
Zero-coupon
bonds
are
normally
issued
at
a
significant
discount
from
face
value
and
do
not
provide
for
periodic
interest
payments.
These
bonds
may
experience
greater
volatility
in
market
value
than
other
debt
obligations
of
similar
maturity
which
provide
for
regular
interest
payments.
TBA
Commitments:
T
BA
commitments
are
forward
agreements
for
the
purchase
or
sale
of
securities,
including
mortgage-backed
securities
for
a
fixed
price,
with
payment
and
delivery
on
an
agreed
upon
future
settlement
date.
The
specific
securities
to
be
delivered
are
not
identified
at
the
trade
date.
However,
delivered
securities
must
meet
specified
terms,
including
issuer,
rate
and
mortgage
terms.
When
entering
into
TBA
commitments,
a
fund
may
take
possession
of
or
deliver
the
underlying
mortgage-backed
securities
but
can
extend
the
settlement
or
roll
the
transaction.
TBA
commitments
involve
a
risk
of
loss
if
the
value
of
the
security
to
be
purchased
or
sold
declines
or
increases,
respectively,
prior
to
settlement
date,
if
there
are
expenses
or
delays
in
connection
with
the
TBA
transactions,
or
if
the
counterparty
fails
to
complete
the
transaction.
To
mitigate
counterparty
risk,
a
fund
enters
into
a
two-way
collateral
agreement
for
TBA
transactions
with
certain
counterparties.
Under
such
agreement,
the
“in-the-money”
party
of
a
TBA
transaction
may
at
any
time
require
the
other
party
to
pledge
collateral
assets
(in
the
form
of
cash
or
securities)
to
offset
any
loss
the
in-the-money
party
would
incur
upon
cancellation
of
the
TBA
transaction.
A
party
is
in-the-money
if
they
are
the
buyer
and
the
market
value
of
the
TBA
transaction
increases
or
if
they
are
the
seller
and
the
market
value
of
the
TBA
transaction
decreases.
Cash
collateral
received
from
the
counterparty
may
be
reinvested
in
money
market
funds,
including
those
managed
by
the
Fund’s
investment
adviser,
or
its
affiliates.
Such
collateral,
if
any,
is
noted
in
the
Schedule
of
Investments
and
the
obligation
to
return
the
collateral
is
presented
as
a
liability
in
the
Statement
of
Assets
and
Liabilities.
Securities
pledged
as
collateral
by
a
fund,
if
any,
are
noted
in
the
Schedule
of
Investments.
Mortgage
Dollar
Roll
Transactions: 
 The
Fund
may
sell
TBA
mortgage-backed
securities
and
simultaneously
contract
to
repurchase
substantially
similar
(i.e.,
same
type,
coupon
and
maturity)
securities
on
a
specific
future
date
at
an
agreed
upon
price.
During
the
period
between
the
sale
and
repurchase,
a
fund
is
not
entitled
to
receive
interest
and
principal
payments
on
the
securities
sold.
Mortgage
dollar
roll
transactions
are
treated
as
purchases
and
sales
and
a
fund
realizes
gains
and
losses
on
these
transactions.
Mortgage
dollar
rolls
involve
the
risk
that
the
market
value
of
the
securities
that
a
fund
is
required
to
purchase
may
decline
below
the
agreed
upon
repurchase
price
of
those
securities.
Securities
Lending:
The
Fund
may
lend
its
securities
to
approved
borrowers,
such
as
brokers,
dealers
and
other
financial
institutions.
The
borrower
pledges
and
maintains
with
the
Fund
collateral
consisting
of
cash,
an
irrevocable
letter
of
credit
issued
by
an
approved
bank,
or
securities
issued
or
guaranteed
by
the
U.S.
Government.
The
initial
collateral
received
by
the
Fund
is
required
to
have
a
value
of
at
least
102%
of
the
current
market
value
of
the
loaned
securities
for
securities
traded
on
U.S.
exchanges
and
a
value
of
at
least
105%
for
all
other
securities.
The
collateral
is
maintained
thereafter
at
a
value
equal
to
at
least
100%
of
the
current
market
value
of
the
securities
on
loan.
The
market
value
of
the
loaned
securities
is
determined
at
the
close
of
each
business
day
of
the
Fund
and
any
additional
required
collateral
is
delivered
to
the
Fund
or
excess
collateral
is
returned
by
the
Fund,
on
the
next
business
day.
During
the
term
of
the
loan,
the
Fund
is
entitled
to
all
distributions
made
on
or
in
respect
of
the
loaned
securities
but
does
not
receive
interest
income
on
securities
received
as
collateral.
Loans
of
securities
are
terminable
at
any
time
and
the
borrower,
after
notice,
is
required
to
return
borrowed
securities
within
the
standard
time
period
for
settlement
of
securities
transactions.
As
of
period
end,
any
securities
on
loan
were
collateralized
by
cash
and/or
U.S.
Government
obligations.
Cash
collateral
invested
in
money
market
funds
managed
by
BFA, or
its
affiliates
is
disclosed
in
the
Schedule
of
Investments.
Any
non-cash
collateral
received
cannot
be
sold,
re-invested
or
pledged
by
the
Fund,
except
in
the
event
of
borrower
default.
The
securities
on
loan,
if
any,
are
also
disclosed
in
the
Fund’s
Schedule
of
Investments.
The
market
value
of
any
securities
on
loan
and
the
value
of
any
related
cash
collateral
are
disclosed
in
the
Statement
of
Assets
and
Liabilities.
The
risks
of
securities
lending
include
the
risk
that
the
borrower
may
not
provide
additional
collateral
when
required
or
may
not
return
the
securities
when
due.
To
mitigate
these
risks,
the
Fund
benefits
from
a
borrower
default
indemnity
provided
by
BlackRock
Finance,
Inc.
BlackRock
Finance,
Inc.'s indemnity
allows
for
full
replacement
of
the
securities
loaned
to
the
extent
the
collateral
received
does
not
cover
the
value
of
the
securities
loaned
in
the
event
of
borrower
default.
The
Fund
could
incur
a
loss
if
the
value
of
an
investment
purchased
with
cash
collateral
falls
below
the
market
value
of
the
loaned
securities
or
if
the
value
of
an
investment
purchased
with
cash
collateral
falls
below
the
value
of
the
original
cash
collateral
received.
Such
losses
are
borne
entirely
by
the
Fund.
5.
Derivative
Financial
Instruments
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
Notes
to
Financial
Statements
(unaudited)
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
20
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
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.
Options:
The
Fund
may purchase
and
write
call
and
put
options
to
increase
or
decrease
its
exposure
to
the
risks
of
underlying
instruments,
including
equity
risk,
interest
rate
risk
and/or
commodity
price
risk
and/or,
in
the
case
of
options
written,
to
generate
gains
from
options
premiums.
A
call
option
gives
the
purchaser
(holder)
of
the
option
the
right
(but
not
the
obligation)
to
buy,
and
obligates
the
seller
(writer)
to
sell
(when
the
option
is
exercised)
the
underlying
instrument
at
the
exercise
or
strike
price
at
any
time
or
at
a
specified
time
during
the
option
period.
A
put
option
gives
the
holder
the
right
to
sell
and
obligates
the
writer
to
buy
the
underlying
instrument
at
the
exercise
or
strike
price
at
any
time
or
at
a
specified
time
during
the
option
period.
Premiums
paid
on
options
purchased
and
premiums
received
on
options
written,
as
well
as
the
daily
fluctuation
in
market
value,
are
included
in
investments
at
value
–
unaffiliated
and
options
written
at
value,
respectively,
in
the
Statement
of
Assets
and
Liabilities.
When
an
instrument
is
purchased
or
sold
through
the
exercise
of
an
option,
the
premium
is
offset
against
the
cost
or
proceeds
of
the
underlying
instrument.
When
an
option
expires,
a
realized
gain
or
loss
is
recorded
in
the
Statement
of
Operations
to
the
extent
of
the
premiums
received
or
paid.
When
an
option
is
closed
or
sold,
a
gain
or
loss
is
recorded
in
the
Statement
of
Operations
to
the
extent
the
cost
of
the
closing
transaction
exceeds
the
premiums
received
or
paid.
When
the
Fund
writes
a
call
option,
such
option
is
typically
“covered,”
meaning
that
it
holds
the
underlying
instrument
subject
to
being
called
by
the
option
counterparty.
When
the
Fund
writes
a
put
option,
cash
is
segregated in
an
amount
sufficient
to
cover
the
obligation.
These
amounts,
which
are
considered
restricted,
are
included
in
cash
pledged
as
collateral
for
options
written
in
the
Statement
of
Assets
and
Liabilities.
Swaptions
–
The
Fund
may purchase
and
write
options
on
swaps
(“swaptions”)
primarily
to
preserve
a
return
or
spread
on
a
particular
investment
or
portion
of
the
Fund’s
holdings,
as
a
duration
management
technique
or
to
protect
against
an
increase
in
the
price
of
securities
it
anticipates
purchasing
at
a
later
date.
The
purchaser
and
writer
of
a
swaption
is
buying
or
granting
the
right
to
enter
into
a
previously
agreed
upon
interest
rate
or
credit
default
swap
agreement
(interest
rate
risk
and/or
credit
risk)
at
any
time
before
the
expiration
of
the
option. 
In
purchasing
and
writing
options,
the
Fund
bears
the
risk
of
an
unfavorable
change
in
the
value
of
the
underlying
instrument
or
the
risk
that
it
may
not
be
able
to
enter
into
a
closing
transaction
due
to
an
illiquid
market.
Exercise
of
a
written
option
could
result
in
the
Fund
purchasing
or
selling
a
security
when
it
otherwise
would
not,
or
at
a
price
different
from
the
current
market
value.
Master
Netting
Arrangements:
In
order
to
define
its
contractual
rights
and
to
secure
rights
that
will
help
it mitigate its
counterparty
risk, the
Fund
may
enter
into
an
International
Swaps
and
Derivatives
Association,
Inc.
Master
Agreement
(“ISDA
Master
Agreement”)
or
similar
agreement
with
its
derivative
contract
counterparties.
An
ISDA
Master
Agreement
is
a
bilateral
agreement
between the
Fund
and
a
counterparty
that
governs
certain
OTC
derivatives
and
typically
contains,
among
other
things,
collateral
posting
terms
and
netting
provisions
in
the
event
of
a
default
and/or
termination
event.
Under
an
ISDA
Master
Agreement, the
Fund
may,
under
certain
circumstances,
offset
with
the
counterparty
certain
derivative
financial
instruments’
payables
and/or
receivables
with
collateral
held
and/or
posted
and
create
one
single
net
payment.
The
provisions
of
the
ISDA
Master
Agreement
typically
permit
a
single
net
payment
in
the
event
of
default
including
the
bankruptcy
or
insolvency
of
the
counterparty.
However,
bankruptcy
or
insolvency
laws
of
a
particular
jurisdiction
may
impose
restrictions
on
or
prohibitions
against
the
right
of
offset
in
bankruptcy,
insolvency
or
other
events.
Collateral
Requirements:
For
derivatives
traded
under
an
ISDA
Master
Agreement,
the
collateral
requirements
are
typically
calculated
by
netting
the
mark-to-market
amount
for
each
transaction
under
such
agreement
and
comparing
that
amount
to
the
value
of
any
collateral
currently
pledged
by
the
Fund(s)
and
the
counterparty.
Cash
collateral
that
has
been
pledged
to
cover
obligations
of
the
Fund
and
cash
collateral
received
from
the
counterparty,
if
any,
is
reported
separately
in
the
Statement
of
Assets
and
Liabilities
as
cash
pledged
as
collateral
and
cash
received
as
collateral,
respectively.
Non-cash
collateral
pledged
by
the
Fund,
if
any,
is
noted
in
the
Schedule
of
Investments.
Generally,
the
amount
of
collateral
due
from
or
to
a
counterparty
is
subject
to
a
certain
minimum
transfer
amount
threshold
before
a
transfer
is
required,
which
is
determined
at
the
close
of
business
of
the
Fund.
Any
additional
required
collateral
is
delivered
to/pledged
by
the
Fund
on
the
next
business
day.
Typically,
the
counterparty
is
not
permitted
to
sell,
re-pledge
or
use
cash
and
non-cash
collateral
it
receives.
The
Fund
generally
agrees
not
to
use
non-cash
collateral
that
it
receives
but
may,
absent
default
or
certain
other
circumstances
defined
in
the
underlying
ISDA
Master
Agreement,
be
permitted
to
use
cash
collateral
received.
In
such
cases,
interest
may
be
paid
pursuant
to
the
collateral
arrangement
with
the
counterparty.
To
the
extent
amounts
due
to
the
Fund
from the
counterparties
are
not
fully
collateralized, the
Fund bears
the
risk
of
loss
from
counterparty
non-performance.
Likewise,
to
the
extent
the
Fund
has
delivered
collateral
to
a
counterparty
and
stands
ready
to
perform
under
the
terms
of
its
agreement
with
such
counterparty, the
Fund bears the
risk
of
loss
from
a
counterparty
in
the
amount
of
the
value
of
the
collateral
in
the
event
the
counterparty
fails
to
return
such
collateral.
Based
on
the
terms
of
agreements,
collateral
may
not
be
required
for
all
derivative
contracts.
For
financial
reporting
purposes,
the
Fund
does
not
offset
derivative
assets
and
derivative
liabilities
that
are
subject
to
netting
arrangements,
if
any,
in
the
Statement
of
Assets
and
Liabilities.
Notes
to
Financial
Statements
(unaudited)
(continued)
21
Notes
to
Financial
Statements
6.
INVESTMENT
ADVISORY
AGREEMENT
AND
OTHER
TRANSACTIONS
WITH
AFFILIATES 
Investment
Advisory
Fees:
Pursuant
to
an
Investment
Advisory
Agreement
with
the 
Trust
,
BFA
manages
the
investment
of
the
Fund’s
assets.
BFA
is
a
California
corporation
indirectly
owned
by
BlackRock,
Inc.
(“BlackRock”). Under
the
Investment
Advisory
Agreement,
BFA
is
responsible
for
substantially
all
expenses
of
the
Fund,
except
(i)
interest
and
taxes;
(ii)
brokerage
commissions
and
other
expenses
connected
with
the
execution
of
portfolio
transactions;
(iii)
distribution
fees;
(iv)
the
advisory
fee
payable
to
BFA;
and
(v)
litigation
expenses
and
any
extraordinary
expenses
(in
each
case
as
determined
by
a
majority
of
the
independent
trustees
).
For
its
investment
advisory
services
to the
Fund,
BFA
is
entitled
to
an
annual
investment
advisory
fee
of
0.25%,
accrued
daily
and
paid
monthly
by
the
Fund,
based
on
the
average
daily
net
assets
of the
Fund.
For
the
period
January
24,
2026
through
March
31,
2026,
the
Fund
paid
BFA
a
total
of
$58,714,
which
is
included
in
investment
advisory
fees
in
the
Statement
of
Operations.
Prior
to
January
24,
2026,
BlackRock
Funds
V
(the
"Predecessor
Trust"),
on
behalf
of
the
Predecessor
Fund,
had
entered
into
an
Investment
Advisory
Agreement
with
BAL,
the
Predecessor
Fund’s
investment
adviser
and
an
indirect,
majority-owned
subsidiary
of
BlackRock,
provided
investment
advisory
services.
BAL
was
responsible
for
the
management
of
the
Predecessor
Fund’s
portfolio
and
provided
the
personnel,
facilities,
equipment
and
certain
other
services
necessary
to
the
operations
of
the
Predecessor
Fund.
For
such
services,
the
Predecessor
Fund
paid
BAL
a
monthly
fee
at
an
annual
rate
equal
to
the
following
percentages
of
the
average
daily
value
of
the
Predecessor
Fund’s
net
assets:
For
the
period
October
1,
2025
through
January
23,
2026,
the
Predecessor
Fund
paid
BAL
a
total
of
$205,582,
which
is
included
in
investment
advisory
fees
in
the
Statement
of
Operations.
Distributor:
BlackRock
Investments,
LLC
(“BRIL”),
an
affiliate
of
BFA,
is
the
distributor
for
the
Fund.
Pursuant
to
the
distribution
agreement,
BFA
is
responsible
for
any
fees
or
expenses
for
distribution
services
provided
to
the
Fund.
ETF
Servicing
Fees:
The
Fund
has
entered
into
an
ETF
Services
Agreement
with
BRIL
to
perform
certain
order
processing,
Authorized
Participant
communications,
and
related
services
in
connection
with
the
issuance
and
redemption
of
Creation
Units
(“ETF
Services”).
BRIL
is
entitled
to
a
transaction
fee
from
Authorized
Participants
on
each
creation
or
redemption
order
for
the
ETF
Services
provided.
The
Fund
does
not
pay
BRIL
for
ETF
Services.
Service
and
Distribution
Fees:
 Prior
to
January
24,
2026,
the
Predecessor
Trust,
on
behalf
of
the
Predecessor
Fund,
had
entered
into
a
Distribution
and
Service
Plan
with
BlackRock
Investments,
LLC
(“BRIL”),
an
affiliate
of
BAL.
Pursuant
to
the
Distribution
and
Service
Plan
and
in
accordance
with
Rule
12b-1
under
the
1940
Act,
the
Predecessor
Fund
paid
BRIL
service
and
distribution
fees.
The
fees
were
accrued
daily
and
paid
monthly
at
annual
rates
based
upon
the
average
daily
net
assets
of
the
relevant
share
class
of
the
Predecessor
Fund
as
follows:
BRIL
and
broker-dealers,
pursuant
to
sub-agreements
with
BRIL,
provided
shareholder
servicing
and
distribution
services to
the
Predecessor
Fund.
The
service and/or
distribution fee
compensated
BRIL
and
each
broker-dealer
for
providing
shareholder
servicing
and/or
distribution related
services
to
shareholders.
For
the period October
1,
2025 through
January
23,
2026,
the
following
table
shows
the
class
specific
service
and
distribution
fees
borne
directly
by
each
share
class
of
the
Predecessor
Fund:
Administration:
Prior
to
January
24,
2026,
the
Predecessor
Trust,
on
behalf
of
the
Predecessor
Fund, had
entered
into
an
Administration
Agreement
with
BAL, to
provide
administrative
services.
For
these
services, BAL
received
an
administration
fee
computed
daily
and
payable
monthly,
based
on
a
percentage
of
the
average
daily
net
assets
of
the
Predecessor
Fund.
The
administration
fee,
which
is
shown
as
administration
in
the
Statement
of
Operations, was
paid
at
the
annual
rates
below
as
follows:
In
addition,
prior
to
January
24,
2026, BAL
charged
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.
Average
Daily
Net
Assets
Investment
Advisory
Fees
First
$1
billion
.........................................................................................................
0.340%
$1
billion
-
$3
billion
.....................................................................................................
0.320
$3
billion
-
$5
billion
.....................................................................................................
0.310
$5
billion
-
$10
billion
....................................................................................................
0.300
Greater
than
$10
billion
...................................................................................................
0.280
Share
Class
Service
Fees
Distribution
Fees
Investor
A
.................................................................................................
0.25‌
%
—‌
%
Investor
C
.................................................................................................
0.25‌
0.75‌
Investor
A
Investor
C
Total
Service
and
distribution
-
class
specific
.............................................................
$
45,427‌
$
14,592‌
$
60,019‌
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
Notes
to
Financial
Statements
(unaudited)
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
22
For
the
period October
1,
2025
through
January
23,
2026, the
following
table
shows
the
class
specific
administration
fees
borne
directly
by
each
share
class
of
the
Predecessor Fund:
Transfer
Agent:
Prior
to
January
24,
2026,
pursuant
to
written
agreements,
certain
financial
intermediaries,
some
of
which
may
have
been
affiliates, provided
the
Predecessor
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
received
an
asset-based
fee
or
an
annual
fee
per
shareholder
account,
which
varied
depending
on
share
class
and/or
net
assets.
For
the
period 
October
1,
2025
 through
January
23,
2026
,
the
Predecessor
Fund's
Institutional
Shares paid
$2,944
to
affiliates
of
BlackRock
in
return
for
these
services,
which
are
included
in
transfer
agent
-
class
specific
in
the
Statement
of
Operations.
Prior
to
January
24,
2026, BAL
maintained
a
call
center
that
was
responsible
for
providing
certain
shareholder
services
to
the
Predecessor Fund.
Shareholder
services
included
responding
to
inquiries
and
processing
purchases
and
sales
based
upon
instructions
from
shareholders.
For
the period
October
1,
2025 through
January
23,
2026, the
Predecessor
Fund
reimbursed BAL
the
following
amounts
for
costs
incurred
in
running
the
call
center,
which
are
included
in
transfer
agent
—
class
specific
in
the
Statement
of
Operations:
For
the
period
October
1,
2025
through
January
23,
2026,
the
following
table
shows
the
class
specific
transfer
agent
fees
borne
directly
by
each
share
class
of
the
Predecessor
Fund:
Other
Fees:
For
the
period
October
1,
2025
through
January
23,
2026,
affiliates
earned
underwriting
discounts,
direct
commissions
and
dealer
concessions
on
sales
of
the
Predecessor
Fund’s
Investor
A
Shares
for
total
$59.
Expense
Limitations,
Waivers
and
Reimbursements:
BFA
has
contractually
agreed
to
waive
a
portion
of
its
investment
advisory
fees
to
the
Fund
in
an
amount
equal
to
the
aggregate
Acquired
Fund
Fees
and
Expenses,
if
any,
attributable
to
investments
by
the
Fund
in
other
equity
and
fixed-income
mutual
funds
and
ETFs
advised
by
BFA
or
its
affiliates
through
June
30,
2026.
BFA
has
also
contractually
agreed
to
waive
a
portion
of
its
investment
advisory
fees
to
the
Fund
by
an
amount
equal
to
the
aggregate
Acquired
Fund
Fees
and
Expenses,
if
any,
attributable
to
investments
by
the
Fund
in
money
market
funds
advised
by
BFA
or
its
affiliates
through
June
30,
2026.
The
agreement
may
be
terminated
upon
90
days’
notice
by
a
majority
of
the
non-interested
trustees
of
the
Trust
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of
the
Fund.
These
amounts
are
included
in
fees
waived
and/or
reimbursed
by
the
Manager
in
the
Statement
of
Operations.
For
the
period
January
24,
2026
through
March
31,
2026,
the
amounts
waived
in
investment
advisory
fees
pursuant
to
these
arrangements
was
$1,701.
Prior
to
January
24,
2026,
with
respect
to
the
Predecessor
Fund,
BAL
contractually
agreed
to
waive
its
investment
advisory
fees
by
the
amount
of
investment
advisory
fees
the
Predecessor
Fund
paid
to
BAL
indirectly
through
its
investment
in
affiliated
money
market
funds
(the
“affiliated
money
market
fund
waiver”)
through
June
30,
2026.
The
contractual
agreement
could
have
been
terminated
upon
90
days’
notice
by
a
majority
of
the
trustees
who
were
not
“interested
persons”
of
the
Predecessor
Trust,
as
defined
in
the
1940
Act
(“Independent
Trustees”),
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of
the
Predecessor
Fund.
The
amount
of
waivers
and/or
reimbursements
of
fees
and
expenses
made
pursuant
to
the
expense
limitation
described
below
was
reduced
by
the
amount
of
the
affiliated
money
market
fund
waiver.
This
amount
is
included
in
fees
waived
and/or
reimbursed
by
the
Investment
Adviser
in
the
Statement
of
Operations.
For
the
period
October
1,
2025
through
January
23,
2026,
the
amount
waived
and/or
reimbursed
was
$287.
Prior
to
January
24,
2026,
with
respect
to
the
Predecessor
Fund,
BAL
had
also
voluntarily
agreed
to
waive
a
portion
of
its
service
and
distribution
fees.
These
amounts
are
reported
in
the
Statement
of
Operations
as
service
and
distribution
fees
waived
and/or
reimbursed
-
class
specific. For
the period
October
1,
2025 through
January
23,
2026, the amount
waived as
follows:
With
respect
to
the
Predecessor
Fund,
BAL
had
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
(“expense
limitation”).
For
the
period
October
1,
2025
through
January
23,
2026,
expense
limitations
as
a
percentage
of
average
daily
net
assets
are
as
follows:
BAL
had
agreed
not
to
reduce
or
discontinue
the
contractual
expense
limitations
through
June
30,
2026,
unless
approved
by
the
Predecessor Fund's
Board,
including
a
majority
of
the Independent
Trustees,
or
by
a
vote
of
a
majority
of
the
outstanding
voting
securities
of the
Predecessor
Fund. For
the
period
October
1,
2025
through
January
Institutional
Investor
A
Investor
C
Class
K
Total
Administration
fees
-
class
specific
..........................................
$
5,767‌
$
3,634‌
$
292‌
$
2,400‌
$
12,093‌
Institutional
Investor
A
Investor
C
Class
K
Total
Reimbursed
Amount
....................................................
$
5,184‌
$
740‌
$
210‌
$
61‌
$
6,195‌
Institutional
Investor
A
Investor
C
Class
K
Total
Transfer
agent
fees
-
class
specific
..........................................
$
75,462‌
$
23,433‌
$
2,124‌
$
61‌
$
101,080‌
Share
Class
Amount
Waived
Investor
A
.....................................................................................
21,010‌
Investor
C
.....................................................................................
6,381‌
$
27,391‌
Share
Class
Expense
Limitation
Institutional
..........................................................................................................
0.42%
Investor
A
...........................................................................................................
0.67
Investor
C
..........................................................................................................
1.42
Class
K
............................................................................................................
0.37
Notes
to
Financial
Statements
(unaudited)
(continued)
23
Notes
to
Financial
Statements
23,
2026, BAL
waived
and/or
reimbursed
investment
advisory
fees
of
$176,713
which
is
included
in
fees
waived
and/or
reimbursed
by Investment
Adviser
in
the
Statement
of
Operations.
Prior
to
January
24,
2026,
the
Predecessor
Fund
also
had
a
waiver
of
administration
fees,
which
are
included
in
Administration
fees
waived
by
the
Investment
Adviser
in
the
Statement
of
Operations.
For
the
period
October
1,
2025
through
January
23,
2026,
the
amount
waived
was
$1,642.
In
addition,
these
amounts
waived
and/or
reimbursed
by
the
Investment
Adviser are
included
in
administration
fees
waived
by
the
Investment
Adviser
—
class
specific
and transfer
agent
fees
waived
and/or
reimbursed
by
the
Investment
Adviser
—
class
specific,
respectively, in
the
Statement
of
Operations.
For
the
period
October
1,
2025
through
January
23,
2026,
class
specific
expense
waivers
and/or
reimbursements were as
follows: 
Trustees and
Officers:
Certain
trustees
 and/or
officers of
the 
Trust
 are directors
and/or
officers
of
BlackRock
or
its
affiliates.
Other
Transactions:
 The
Fund
may
invest
its
positive
cash
balances
in
certain
money
market
funds
managed
by
BFA
or
an
affiliate.
The
income
earned
on
these
temporary
cash
investments
is
shown
as
dividends
–
affiliated
in
the
Statement
of
Operations.
7.
PURCHASES
AND
SALES 
For
the six
months ended
March
31,
2026,
purchases
and
sales
of
investments, excluding
short-term
investments,
were
as
follows:
For
the six
months ended
March
31,
2026,
purchases
and
sales
related
to
mortgage
dollar
rolls
were
$941,195,209
and
$941,179,018,
respectively. 
8.
INCOME
TAX
INFORMATION 
The
Fund
is
treated
as
an
entity
separate
from
the Trust’s
other
funds
for
federal
income
tax
purposes.
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.
Management
has
analyzed
tax
laws
and
regulations
and
their
application
to
the Fund
as
of
March
31,
2026,
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.
Management’s
analysis
is
based
on
the
tax
laws
and
judicial
and
administrative
interpretations
thereof
in
effect
as
of
the
date
of
these
financial
statements,
all
of
which
are
subject
to
change,
possibly
with
retroactive
effect,
which
may
impact
the
Fund's
NAV.
As
of
September
30,
2025,
the
Predecessor
Fund
had
non-expiring
capital
loss
carryforwards
of
$142,963,853
available
to
offset
future
realized
capital
gains.
As
of
March
31,
2026, 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.
BANK
BORROWINGS 
Prior
to
January
24,
2026,
the
Predecessor
Trust,
on
behalf
of
the
Predecessor
Fund,
along
with
certain
other
funds
managed
by BAL
and
its
affiliates
(“Participating
Funds”), was
party
to
a
364-day,
$2.40
billion
credit
agreement
with
a
group
of
lenders.
Under
this
agreement,
Predecessor
Fund
could
borrow
to
fund
shareholder
redemptions.
Excluding
commitments
designated
for
certain
individual
funds,
the
Participating
Funds,
including
the
Predecessor Fund,
could
borrow
up
to
an
aggregate
commitment
amount
of
$1.75
billion
at
any
time
outstanding,
subject
to
asset
coverage
and
other
limitations
as
specified
in
the
agreement.
The
credit
agreement
had
the
following
terms:
a
fee
of
0.10%
per
annum
on
unused
commitment
amounts
and
interest
at
a
rate
equal
to
the
higher
of
(a)
Overnight
Bank
Funding
Rate
(“OBFR”)
(but,
in
any
event,
not
less
than
0.00%)
on
the
date
the
loan
was
made
plus
0.80%
per
annum,
(b)
the
Fed
Funds
rate
(but,
in
any
event,
not
less
than
0.00%)
in
effect
from
time
to
time
plus
0.80%
per
annum
on
amounts
borrowed
or
(c)
the
sum
of
(x)
Daily
Simple Secured
Overnight
Financing
Rate
("SOFR") (but,
in
any
event,
not
less
than
0.00%)
Share
Class
Administration
Fees
Waived
by
the
Investment
Adviser
—
Class
Specific
Transfer
Agent
Fees
Waived
and/or
Reimbursed
by
the
Investment
Adviser
—
Class
Specific
Institutional
....................................................................................
$
5,767‌
$
60,984‌
Investor
A
.....................................................................................
3,634‌
14,343‌
Investor
C
.....................................................................................
292‌
1,399‌
Class
K
......................................................................................
2,400‌
61‌
$
12,093‌
$
76,787‌
U.S.
Government
Securities
Other
Securities
Fund
Name
Purchases
Sales
Purchases
Sales
iShares
Mortgage-Backed
Securities
Active
ETF
.................................
$
2,535,385,109‌
$
2,672,208,933‌
$
6,845,022‌
$
6,890,606‌
Fund
Name
Tax
Cost
Gross
Unrealized
Appreciation
Gross
Unrealized
Depreciation
Net
Unrealized
Appreciation
(Depreciation)
iShares
Mortgage-Backed
Securities
Active
ETF
............................
$
249,247,084‌
$
2,442,149‌
$
(3,674,988‌)
$
(1,232,839‌)
Notes
to
Financial
Statements
(unaudited)
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
24
on
the
date
the
loan was
made
plus
0.10%
and
(y)
0.80%
per
annum. These
fees
were
allocated
among
such
funds
based
upon
portions
of
the
aggregate
commitment
available
to
them
and
relative
net
assets
of
Participating
Funds.
For
the
period
October
1,
2025
through
January
23,
2026,
the
Predecessor Fund
did
not
borrow
under
the
credit
agreement.
10.
 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,
tariffs or
international
tax
treaties
between
various
countries;
or
(iv)
currency,
interest
rate
or
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.
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.
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.
With
exchange-traded
futures,
there
is
less
counterparty
credit
risk
to
the
Fund
since
the
exchange
or
clearinghouse,
as
counterparty
to
such
instruments,
guarantees
against
a
possible
default.
The
clearinghouse
stands
between
the
buyer
and
the
seller
of
the
contract;
therefore,
credit
risk
is
limited
to
failure
of
the
clearinghouse.
While
offset
rights
may
exist
under
applicable
law, the
Fund
does
not
have
a
contractual
right
of
offset
against
a
clearing
broker
or
clearinghouse
in
the
event
of
a
default
(including
the
bankruptcy
or
insolvency).
Additionally,
credit
risk
exists
in exchange-traded
futures with
respect
to
initial
and
variation
margin
that
is
held
in
a
clearing
broker’s
customer
accounts.
While
clearing
brokers
are
required
to
segregate
customer
margin
from
their
own
assets,
in
the
event
that
a
clearing
broker
becomes
insolvent
or
goes
into
bankruptcy
and
at
that
time
there
is
a
shortfall
in
the
aggregate
amount
of
margin
held
by
the
clearing
broker
for
all
its
clients,
typically
the
shortfall
would
be
allocated
on
a
pro
rata
basis
across
all
the
clearing
broker’s
customers,
potentially
resulting
in
losses
to
the
Fund. 
Geographic/Asset
Class
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 uses
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
decrease
as
interest
rates
rise
and
increase
as
interest
rates
fall.
The
Fund
may
be
subject
to
a
greater
risk
of
rising
interest
rates
during
a
period
of
historically
low
interest
rates.
Changing
interest
rates
may
have
unpredictable
effects
on
markets,
may
result
in
heightened
market
volatility,
and
could
negatively
impact
the
Fund’s
performance.
The
Fund
invests
a
significant
portion
of
its
assets
in
securities
of
issuers
located
in
the
United
States.
A
decrease
in
imports
or
exports,
changes
in
trade
regulations,
inflation
and/or
an
economic
recession
in
the
United
States
may
have
a
material
adverse
effect
on
the
U.S.
economy
and
the
securities
listed
on
U.S.
exchanges.
Proposed
and
adopted
policy
and
legislative
changes
in
the
United
States
may
also
have
a
significant
effect
on
U.S.
markets
generally,
as
well
as
on
the
value
of
certain
securities.
Governmental
agencies
project
that
the
United
States
will
continue
to
maintain
elevated
public
debt
levels
for
the
foreseeable
future
which
may
constrain
future
economic
growth.
Circumstances
could
arise
that
could
prevent
the
timely
payment
of
interest
or
principal
on
U.S.
government
debt,
such
as
reaching
the
legislative
“debt
ceiling.”
Such
non-payment
would
result
in
substantial
negative
consequences
for
the
U.S.
economy
and
the
global
financial
system.
If
U.S.
relations
with
certain
countries
deteriorate,
it
could
adversely
affect
issuers
that
rely
on
the
United
States
for
trade.
The
United
States
has
also
experienced
increased
internal
unrest
and
discord.
If
these
trends
were
to
continue,
they
may
have
an
adverse
impact
on
the
U.S.
economy
and
the
issuers
in
which
the
Fund
invests.
Notes
to
Financial
Statements
(unaudited)
(continued)
25
Notes
to
Financial
Statements
The
Fund
invests
a
significant
portion
of
its
assets
in
securities
backed
by
commercial
or
residential
mortgage
loans
or
in
issuers
that
hold
mortgage
and
other
asset-backed
securities.
When
a
fund
concentrates
its
investments
in
this
manner,
it
assumes
a
greater
risk
of
prepayment
or
payment
extension
by
securities
issuers. Changes
in
economic
conditions,
including
delinquencies
and/or
defaults
on
assets
underlying
these
securities,
can
affect
the
value,
income
and/or
liquidity
of
such
positions.
Investment
percentages
in
these
securities
are
presented
in
the
Schedule
of
Investments.
Significant
Shareholder
Redemption
Risk:
Certain
shareholders
may
own
or
manage
a
substantial
amount
of
fund
shares
and/or
hold
their
fund
investments
for
a
limited
period
of
time.
Large
redemptions
of
fund
shares
by
these
shareholders
may
force
a
fund
to
sell
portfolio
securities,
which
may
negatively
impact
the
fund’s
NAV,
increase
the
fund’s
brokerage
costs,
and/or
accelerate
the
realization
of
taxable
income/gains
and
cause
the
fund
to
make
additional
taxable
distributions
to
shareholders.
11.
CAPITAL
SHARE
TRANSACTIONS 
Capital
shares
are
issued
and
redeemed
by
the
Fund
only
in
aggregations
of
a
specified
number
of
shares
or
multiples
thereof
(“Creation
Units”)
at
NAV.
Except
when
aggregated
in
Creation
Units,
shares
of
the
Fund
are
not
redeemable.
Transactions
in
capital
shares
for
the
Fund
and
each
share
class
of
the
Predecessor
Fund
were
as
follows:
(a)
See
Note
1
of
the
Notes
to
Financial
Statements
for
information
on
the
Fund’s
reorganization.
The
consideration
for
the
purchase
of
Creation
Units
of
a
fund
in
the
Trust
generally
consists
of
the
in-kind
deposit
of
a
designated
portfolio
of
securities
and
a
specified
amount
of
cash.
Certain
funds
in
the
Trust
may
be
offered
in
Creation
Units
solely
or
partially
for
cash
in
U.S.
dollars.
Authorized
Participants
purchasing
and
redeeming
Creation
Units
may
pay
a
purchase
transaction
fee
and
a
redemption
transaction
fee
directly
to
BRIL,
to
offset
transfer
and
other
transaction
costs
associated
with
the
Period
from
01/24/26
to
03/31/26
Fund
Name
Shares
Amounts
iShares
Mortgage-Backed
Securities
Active
ETF
(a)
Shares
issued
in
reorganization
.............
2,584,113‌
$
129,205,650‌
Shares
redeemed
......................
(60,000‌)
(3,032,191‌)
2,524,113
$
126,173,459
d                                                      
Period
from
10/01/25
to
01/23/26
Year
Ended
09/30/25
Predecessor
Fund
Name/Share
Class
Shares
Amount
Shares
Amount
BlackRock
Mortgage-Backed
Securities
Fund
(a)
Institutional
Shares
sold
..........................................
1,143,534
$
9,279,751
2,416,242
$
19,027,583
Shares
issued
in
reinvestment
of
distributions
.....................
140,807
1,141,403
496,401
3,926,800
Shares
converted
in
reorganization
(9,200,500
)
(74,505,650
)
—
—
Shares
redeemed
......................................
(3,715,848
)
(30,165,600
)
(6,534,286
)
(51,521,692
)
(11,632,007
)
$
(94,250,096
)
(3,621,643
)
$
(28,567,309
)
Investor
A
Shares
sold
and
automatic
conversion
of
shares
....................
72,707
$
592,104
532,800
$
4,252,347
Shares
issued
in
reinvestment
of
distributions
.....................
89,947
732,036
265,005
2,105,826
Shares
converted
in
reorganization
(6,192,361
)
(50,364,950
)
—
—
Shares
redeemed
......................................
(1,243,948
)
(10,126,032
)
(1,764,956
)
(13,980,226
)
(7,273,655
)
$
(59,166,842
)
(967,151
)
$
(7,622,053
)
Investor
C
Shares
sold
..........................................
1,339
$
10,858
131,868
$
1,052,224
Shares
issued
in
reinvestment
of
distributions
.....................
6,962
56,427
20,952
165,749
Shares
converted
in
reorganization
(469,689
)
(3,803,400
)
—
—
Shares
redeemed
and
automatic
conversion
of
shares
...............
(163,334
)
(1,323,655
)
(282,912
)
(2,232,132
)
(624,722
)
$
(5,059,770
)
(130,092
)
$
(1,014,159
)
Class
K
Shares
sold
..........................................
167,285
$
1,353,045
713,537
$
5,600,017
Shares
issued
in
reinvestment
of
distributions
.....................
59,310
478,891
410,996
3,241,389
Shares
converted
in
reorganization
(65,866
)
(531,650
)
—
—
Shares
redeemed
......................................
(8,187,123
)
(66,178,542
)
(3,490,327
)
(27,391,573
)
(8,026,394
)
$
(64,878,256
)
(2,365,794
)
$
(18,550,167
)
(25,032,665
)
$
(97,181,505
)
(7,084,680
)
$
(55,753,688
)
Notes
to
Financial
Statements
(unaudited)
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
26
issuance
and
redemption
of
Creation
Units,
including
Creation
Units
for
cash.
Authorized
Participants
transacting
in
Creation
Units
for
cash
may
also
pay
an
additional
variable
charge
to
compensate
the
relevant
fund
for
certain
transaction
costs
(i.e.,
stamp
taxes,
taxes
on
currency
or
other
financial
transactions,
and
brokerage
costs)
and
market
impact
expenses
relating
to
investing
in
portfolio
securities.
Such
variable
charges,
if
any,
are
included
in
shares
sold
in
the
table
above.
To
the
extent
applicable,
to
facilitate
the
timely
settlement
of
orders
for
the
Fund
using
a
clearing
facility
outside
of
the
continuous
net
settlement
process,
the
Fund,
at
its
sole
discretion,
may
permit
an
Authorized
Participant
to
post
cash
as
collateral
in
anticipation
of
the
delivery
of
all
or
a
portion
of
the
applicable
Deposit
Securities
or
Fund
Securities,
as
further
described
in
the
applicable
Authorized
Participant
Agreement.
The
collateral
process
is
subject
to
a
Control
Agreement
among
the
Authorized
Participant,
the
Fund’s
custodian,
and
the
Fund.
In
the
event
that
the
Authorized
Participant
fails
to
deliver
all
or
a
portion
of
the
applicable
Deposit
Securities
or
Fund
Securities,
the
Fund
may
exercise
control
over
such
collateral
pursuant
to
the
terms
of
the
Control
Agreement
in
order
to
purchase
the
applicable
Deposit
Securities
or
Fund
Securities.
From
time
to
time,
settlement
of
securities
related
to
in-kind
contributions
or
in-kind
redemptions
may
be
delayed.
In
such
cases,
securities
related
to
in-kind
transactions
are
reflected
as
a
receivable
or
a
payable
in
the
Statement
of
Assets
and
Liabilities.
12.
SUBSEQUENT
EVENTS 
Management’s
evaluation
of
the
impact
of
all
subsequent
events
on
the
Fund’s
financial
statements
was
completed
through
the
date
the
financial
statements
were
issued
and
the
following
item was
noted:
Effective
April
9,
2026,
the
Trust,
on
behalf
of
the
Fund,
along
with
certain
other
funds
managed
by
the
Manager
and
its
affiliates
(“Participating
Funds”),
is
party
to
a
364-day,
$2.40
billion
credit
agreement
with
a
group
of
lenders.
Under
this
agreement,
the
Fund
may
borrow
to
fund
shareholder
redemptions.
Excluding
commitments
designated
for
certain
individual
funds,
the
Participating
Funds,
including
the
Fund,
can
borrow
up
to
an
aggregate
commitment
amount
of
$1.75
billion
at
any
time
outstanding,
subject
to
asset
coverage
and
other
limitations
as
specified
in
the
agreement.
The
credit
agreement
has
the
following
terms:
a
fee
of
0.10%
per
annum
on
unused
commitment
amounts
and
interest
at
a
rate
equal
to
the
higher
of
(a)
OBFR
(but,
in
any
event,
not
less
than
0.00%)
on
the
date
the
loan
is
made
plus
0.80%
per
annum,
(b)
the
Fed
Funds
rate
(but,
in
any
event,
not
less
than
0.00%)
in
effect
from
time
to
time
plus
0.80%
per
annum
on
amounts
borrowed
or
(c)
the
sum
of
(x)
Daily
Simple
SOFR
(but,
in
any
event,
not
less
than
0.00%)
on
the
date
the
loan
is
made
plus
0.10%
and
(y)
0.80%
per
annum.
The
agreement
expires
in
April
2027
unless
extended
or
renewed.
Additional
Information
27
Additional
Information
Electronic
Delivery
Shareholders
can
sign
up
for
e-mail
notifications
announcing
that
the
shareholder
report
or
prospectus
has
been
posted
on
the
iShares
website
at
iShares.com
.
Once
you
have
enrolled,
you
will
no
longer
receive
prospectuses
and
shareholder
reports
in
the
mail.
To
enroll
in
electronic
delivery:
•  
Go
to
icsdelivery.com
.
• 
 If
your
brokerage
firm
is
not
listed,
electronic
delivery
may
not
be
available.
Please
contact
your
broker-dealer
or
financial
advisor.
Changes
in
and
Disagreements
with
Accountants
Not
applicable.
Proxy
Results
Not
applicable.
Remuneration
Paid
to
Trustees,
Officers,
and
Others
Because
BFA
has
agreed
in
the
Investment
Advisory
Agreements
to
cover
all
operating
expenses
of
the
Funds,
subject
to
certain
exclusions
as
provided
for
therein,
BFA
pays
the
compensation
to
each
Independent
Trustee
for
services
to
the
Funds
from
BFA's
investment
advisory
fees.
Availability
of
Portfolio
Holdings
Information
A
description
of
the
Trust's
policies
and
procedures
with
respect
to
the
disclosure
of
the
Fund’s
portfolio
securities
is
available
in
the
Fund
Prospectus.
The
Fund
discloses
its
portfolio
holdings
daily
and
provides
information
regarding
its
top
holdings
in
Fund
fact
sheets,
when
available, at
iShares.com
.
Additional
Information
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
28
Fund
and
Service
Providers
Investment
Adviser
BlackRock
Fund
Advisors
San
Francisco,
CA
94105
Administrator,
Custodian
and
Transfer
Agent
JPMorgan
Chase
Bank,
N.A.
New
York,
NY
10179
Independent
Registered
Public
Accounting
Firm
Deloitte
&
Touche
LLP
Boston,
MA
02110
Distributor
BlackRock
Investments,
LLC
New
York,
NY
10001
Legal
Counsel
Willkie
Farr
&
Gallagher
LLP
New
York,
NY
10019
Address
of
the
Trust
100
Bellevue
Parkway
Wilmington,
DE
19809
Disclosure
of
Investment
Advisory
Agreement
29
Disclosure
of
Investment
Advisory
Agreement
The
Board
of
Trustees
(the
“Board,”
the
members
of
which
are
referred
to
as
“Board
Members”)
of
BlackRock
ETF
Trust
II
(the
“Trust”)
met
on
June
5,
2025
(the
“Meeting”)
to
consider
the
approval
of
the
proposed
investment
advisory
agreement
(the
“Advisory
Agreement”
or
the
“Agreement”)
between
the
Trust,
on
behalf
of
iShares
Mortgage-Backed
Securities
Active
ETF
(the
“Fund”),
and
BlackRock
Fund
Advisors
(the
“Manager”
or
“BlackRock”),
the
Fund’s
investment
advisor.
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
Agreement.
The
Board
Members
who
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
Agreement.
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
Agreement,
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
Agreement.
The
Board
received
materials
in
advance
of
the
Meeting
relating
to
its
consideration
of
the
Agreement,
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
Agreement.
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
Agreement
relative
to
services
typically
provided
by
third
parties
to
other
funds.
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
received
information
regarding
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
considered
information
received
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
BlackRock
Fixed-Income
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
experience
of
the
Fund’s
portfolio
management
team;
research
capabilities;
investments
by
portfolio
managers
in
the
funds
they
manage;
portfolio
trading
capabilities;
use
of
certain
trading,
portfolio
management,
operations
and/or
information
systems
owned
by
BlackRock;
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
considered
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.
In
particular,
BlackRock
and
its
affiliates
will
provide
the
Fund
with
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
and
stock
exchanges;
(iv)
overseeing
and
coordinating
the
activities
of
third-party
service
providers
including,
among
others,
the
Fund’s
custodian,
fund
accountant,
transfer
agent,
and
auditor;
(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
Disclosure
of
Investment
Advisory
Agreement
(continued)
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
30
Board
reviewed
the
structure
and
duties
of
BlackRock’s
fund
administration,
shareholder
services,
and
legal
and
compliance
departments
and
considered
BlackRock’s
policies
and
procedures
for
assuring
compliance
with
applicable
laws
and
regulations.
The
Board
also
considered
the
operation
of
BlackRock’s
business
continuity
plans.
B.
The
Investment
Performance
of
the
Fund
In
their
capacity
as
members
of
the
boards
of
directors/trustees
of
other
funds
in
the
BlackRock
Fixed-Income
Complex,
the
Board
Members,
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
advisory
fee
rate,
noting
that
the
Agreement
provides
for
a
unitary
fee
structure
that
includes
advisory
and
administration
services.
Under
the
unitary
fee
structure,
the
Fund
will
pay
a
single
fee
to
BlackRock
and
BlackRock
will
pay
all
operating
expenses
of
the
Fund,
except
the
advisory
fees,
interest
expenses,
taxes,
expenses
incurred
with
respect
to
the
acquisition
and
disposition
of
portfolio
securities
and
the
execution
of
portfolio
transactions,
including
brokerage
commissions,
distribution
fees
or
expenses,
litigation
expenses
and
extraordinary
expenses.
The
Board,
including
the
Independent
Board
Members,
reviewed
the
Fund’s
contractual
management
fee
rate
compared
with
those
of
its
Broadridge
peer
group.
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.
In
addition,
the
Board,
including
the
Independent
Board
Members,
considered
the
Fund’s
estimated
total
expense
ratio,
as
well
as
its
estimated
actual
management
fee
rate,
compared
to
its
Broadridge
peer
group.
The
estimated
total
expense
ratio
represents
a
fund’s
total
net
operating
expenses,
excluding
any
investment
related
expenses.
The
estimated
total
expense
ratio
gives
effect
to
any
expense
reimbursements
or
fee
waivers,
and
the
estimated
actual
management
fee
rate
gives
effect
to
any
management
fee
reimbursements
or
waivers.
The
Board
also
noted
that
while
it
found
the
expense
comparison
provided
by
Broadridge
generally
useful,
it
recognized
that
the
comparison
is
subject
to
Broadridge’s
defined
peer
selection
criteria
and
methodology.
Additionally,
the
Board
noted
information
received
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
BlackRock
Fixed-Income
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
considered
whether
BlackRock
has
the
financial
resources
necessary
to
attract
and
retain
high
quality
investment
management
personnel
to
perform
its
obligations
under
the
Agreement
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
and
resources,
assumption
of
risk,
and
liability
profile
in
servicing
the
Fund,
including
in
contrast
to
what
is
required
of
BlackRock
with
respect
to
other
products
with
similar
investment
mandates
across
the
open-end
fund,
ETF,
closed-end
fund,
sub-advised
mutual
fund,
separately
managed
account,
collective
investment
trust,
and
institutional
separate
account
product
channels,
as
applicable.
The
Board
noted
that
the
Fund’s
proposed
contractual
management
fee
rate
ranked
in
the
first
quartile,
and
that
the
Fund’s
estimated
actual
management
fee
rate
and
estimated
total
expense
ratio
would
rank
in
the
fourth
and
third
quartiles,
respectively,
relative
to
the
Fund’s
Broadridge
peer
group.
The
Board
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
Fixed-Income
Complex.
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
any
economies
of
scale
might
benefit
the
Fund
in
a
variety
of
ways
as
the
assets
of
the
Fund
increase.
The
Board
considered
multiple
factors,
including
the
advisory
fee
rate
and
breakpoints,
unitary
fee
structure,
fee
waivers,
and/or
expense
caps,
as
applicable.
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,
ETF
servicing
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
Agreement,
the
Board
also
received
information
regarding
BlackRock’s
brokerage
and
soft
dollar
practices.
The
Board
received
reports
from
BlackRock
at
prior
meetings
of
the
boards
of
directors/trustees
of
other
funds
in
the
BlackRock
Fixed-Income
Complex
which
included
information
on
brokerage
commissions
and
trade
execution
practices.
The
Board
noted
the
competitive
nature
of
the
ETF
marketplace,
and
that
shareholders
are
able
to
redeem
or
sell
their
Fund
shares
if
they
believe
that
the
Fund’s
fees
and
expenses
are
too
high
or
if
they
are
dissatisfied
with
the
performance
of
the
Fund.
Disclosure
of
Investment
Advisory
Agreement
(continued)
31
Disclosure
of
Investment
Advisory
Agreement
Conclusion
The
Board,
including
the
Independent
Board
Members,
unanimously
approved
the
Advisory
Agreement
between
the
Manager
and
the
Trust,
on
behalf
of
the
Fund,
for
a
two-year
term
beginning
on
the
effective
date
of
the
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
Agreement
were
fair
and
reasonable
and
in
the
best
interest
of
the
Fund
and
its
shareholders.
In
arriving
at
its
decision
to
approve
the
Agreement,
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
advised
by
independent
legal
counsel
throughout
the
deliberative
process.
Glossary
of
Terms
Used
in
these
Financial
Statements
2026
BlackRock
Semi-Annual
Financial
Statements
and
Additional
Information
32
Currency
Abbreviation
USD
United
States
Dollar
Portfolio
Abbreviation
OTC
Over-the-counter
SOFR
Secured
Overnight
Financing
Rate
TBA
To-be-announced
Want
to
know
more?
blackrock.com
|
1-800-474-2737
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
Funds
unless
preceded
or
accompanied
by
the
Funds’
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.
Item 8 – Changes in and Disagreements with Accountants for Open-End Management Investment Companies – See Item 7
Item 9 – Proxy Disclosures for Open-End Management Investment Companies – See Item 7
 
Item 10 – Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies – See Item 7
 
Item 11 – Statement Regarding Basis for Approval of Investment Advisory Contract – Not Applicable
 
Item 12 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable
Item 13 – Portfolio Managers of Closed-End Management Investment Companies - Not Applicable
Item 14 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable
Item 15 – Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.
Item 16 – 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 date of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
(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 17 – Disclosure of Securities Lending Activities for Closed-End Management Investment Companies –Not Applicable
Item 18 – Recovery of Erroneously Awarded Compensation – Not Applicable
Item 19 – Exhibits attached hereto
              (a)(1) Code of Ethics – Not Applicable to this semi-annual report.
              (a)(2) Any policy required by the listing standards adopted pursuant to Rule 10D-1 under the Exchange Act (17 CFR 240.10D-1) by the registered national securities exchange or registered national securities association upon which the registrant’s securities are listed – Not Applicable
              (a)(3) Section 302 Certifications are attached
(a)(4) Any written solicitation to purchase securities under Rule 23c-1 – Not Applicable
(a)(5) Change in Registrant’s independent public accountant – Not Applicable
(b) Section 906 Certifications are attached
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 ETF Trust II
 
By:     /s/ John M. Perlowski              
John M. Perlowski
Chief Executive Officer (principal executive officer) of
          BlackRock ETF Trust II
 
Date: May 22, 2026 
 
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 ETF Trust II
 
Date: May 22, 2026 
 
By:     /s/ Trent Walker                                  
Trent Walker
Chief Financial Officer (principal financial officer) of
BlackRock ETF Trust II
 
Date: May 22, 2026 
ATTACHMENTS / EXHIBITS

ATTACHMENTS / EXHIBITS

blketfii033126302.htm

blketfii033126906.htm

blk-20260331.xsd

IDEA: R1.htm

IDEA: R2.htm

IDEA: R3.htm

IDEA: FilingSummary.xml

IDEA: MetaLinks.json

IDEA: primary-document_htm.xml