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BlackRock Income Strategies to review objective

01 August 2016 09:09

BlackRock Income Strategies Trust is suspending the implementation of share buybacks until it has concluded a review of the investment objective and policy.

The company says the board and the investment manager, BlackRock, have been considering the investment objective and policy as implemented in February 2015 in the context of the prevailing market conditions and investment outlook post the recent UK Brexit referendum.

The investment objective is, over the medium term (5 to 7 years), to aim to preserve capital in real terms and to grow the dividend at least in line with inflation. The company will target a total portfolio return of UK Consumer Price Index (CPI) plus 4 per cent per annum (before ongoing charges) over a 5 to 7 year cycle.

Since the implementation of the new investment objective and policy, interest rates have fallen and there has been a significant decline in the universe of investments which could support a multi-asset approach to meeting the stated investment objective and total portfolio return target.

Although in the last 12 months the Company has paid dividends totalling 6.64 pence per share, which represents a dividend yield of 5.6% (based on Friday's closing share price), since the change in investment objective and policy the Companys NAV (cum income, with debt at fair value) has declined by 14%. For this reason the board believes a review of the investment objective and policy is merited.

At 9:09am: (LON:BIST) BlackRock Income Strategies Trust Plc share price was -0.5p at 118.75p

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