Laurence D. Fink
Chairman and Chief Executive Officer at BlackRock
Thank you, Gary, and good morning to everyone, and thank you for joining the call. As I wrote to shareholders last month, Russia's invasion of Ukraine has created a humanitarian tragedy and is impacting not only geopolitics but also the global economies. It is going to fundamentally alter the path of globalization that we've seen over the past 30 years. The flow of goods and people across borders will still be a critical to economic growth and new technologies will continue to shrink geographic distances, but countries and companies are reevaluating their interdependencies in a way that we have not seen since the end of the Cold War.
As a fiduciary, BlackRock is working to understand how these structural changes will impact our client portfolios and we will help them pursue their long-term financial goals. The breadth and scale of BlackRock's platform enables us to serve clients in all market environments. We invested over many years to build a comprehensive investment platform, industry-leading technology and a global footprint with local expertise. By evolving ahead of our -- the needs of our clients, we have grown as a trusted partner to all our clients.
We constantly work to provide our clients with that type of insight, but close connectivity becomes even more important during periods of market volatility and uncertainty. Over the last two months following Russia's invasion of Ukraine, BlackRock held over 200 client engagements and hosted market update calls attended by more than 4,600 clients. Also recently visited clients in Japan, in the Middle East, and here in the United States, many of whom are trying to understand how geopolitical and macroeconomic shifts might impact their investment outcomes. I remember the same heightened level of connectivity with our clients during the initial weeks of the pandemic in spring 2020.
I believe our relationships with clients have never been stronger. Our clients appreciate our voice and our consistent advocacy for long-term investing on their behalf. Our first quarter's result demonstrates these strengths. BlackRock generated $114 billion of net long-term inflows in the first quarter, demonstrating the breadth of our asset management platform and positive flows across all product types, all investment styles and all regions.
Organic growth in the quarter included two significant client mandates, reflecting our ability to deepen partnerships and build a comprehensive relationship with clients globally. We also saw a 13% ACV growth in technology services as more clients recognize the benefits of Aladdin. I'm incredibly excited about the opportunities ahead of us and we will continue to invest for the future. Throughout our 23-year history as a public company, we have demonstrated that we are intentional about our investment spend and focused on our margin. I have found that often in times of market uncertainty, that is the greatest opportunity that we could find. BlackRock's breadth and resilience enables us to play offense when others may be pulling back. Our agility in responding to opportunities and continue to investments across market cycles have driven our industry-leading growth, our consistent growth, and generated value for our shareholders.
Our investments are closely aligned with our strategy to keep alpha at the heart of BlackRock, accelerated growth in iShares, in private markets and Aladdin, to deliver whole portfolio advice and solutions to our clients and be the global leader in sustainable investing. Our clients are trying to understand the implications of the rapidly changing investment environment. The Russian invasion of Ukraine marks the profound geopolitical shift that is accelerating a reassessment of global supply chains. It also creates a supply shock in commodities that is further increasing inflation. Even before the war inflation was already top of mind for many investors as the effect of the pandemic, including the shift in consumer demand from services to capital goods, labor shortages and supply chain bottlenecks brought inflation in the United States, in Canada, and the United Kingdom, across European Union to the highest level in decades.
Central banks are in a difficult position as they look to carefully raise rates to contain inflation without harming economic activity and employment. They may eventually have to live with a supply driven inflation rather than take policy rates above neutral levels. However, they may be forced to be more aggressive policy stance of inflation expectation become unchartered. Bond markets have been quick to price in the Fed's rate projections and saw one of the worst quarters on record for the US bond market. The market was down, while the US aggregate index was down more than 5%.
Equity markets on the other hand have shown some resilience. Following significant market volatility in the first quarter, US and European broad market indexes regained some of the losses and ended down the quarter around 5% and 6% respectively. As always, BlackRock remains guided by our clients needs and we constantly evolve so we can be better serving them. Clients increasingly want to work with fewer partners who can provide more and BlackRock is uniquely positioned to capture opportunities as clients consolidate their investment providers. We have the investment expertise, we have the operational excellence and the technology capabilities work with the clients of all types and sizes, and we are well positioned to help them meet their objectives and to serve all of their own stakeholders.
The global insurance industry for example is undergoing significant transformation as insurers optimize their operating model and leverage outsource investment management solutions. We have built a leading insurance platform compromising fixed income -- fixed income investment specialist, insurance advisory expertise and Aladdin analytical capabilities to deliver the best of BlackRock to our insurance clients. We are also seeing the results of these investment through deeper relationships with all our clients and significant opportunities are in front of us today.
Last month, we announced a significant assignment with AIG, spanning asset management and Aladdin. BlackRock will manage up to $150 billion of AIG and its life and in retirement companies investment portfolio. This is another great example of one BlackRock effort to bring together our platform, to serve our clients at a way that no other asset manager can do. All of us here at BlackRock take a deep responsibility and in managing every dollar for every client awards this money, from institutions and trusting us with their whole portfolios to that individual investor using one of our ETFs in their first investment account.
In the first quarter, we once again saw investors using ETFs to quickly allocate capital and the managed risk during periods of volatility. In the US, iShares secondary trading volumes were up nearly 40% compared to 2021 levels, providing clients worldwide with the liquidity they needed in volatile markets. We generated $56 billion of ETF net inflows in the first quarter, with growth coming from each of our major product categories, including core strategic and precision ETFs. In fixed income, ETFs, we generated $8 billion of net inflows for the quarter. Similar to equity ETFs, we are seeing more investors adopt and use fixed income ETFs to gain market exposure and for tactical positioning within their fixed income exposures.
We saw demand for treasury, short duration inflation-linked, sustainable, Moody's and broad-based market exposures, which more than offset risk off settlements in areas like high-yield and emerging markets. Our growth in fixed income ETFs highlight the diversity of our fixed income ETF product range and our ability to deliver the market qualities clients expect in stressed markets. The liquidity, the transparency and lower transaction costs of fixed income ETFs present a more efficient way for investors to access the entire bond market. We believe that our fixed income ETFs will benefit from more long-term secular tailwinds that play a significant role in the modernization of the $100 trillion bond market.
BlackRock generated $20 billion of active net inflows across our active equities, multi-asset and alternative strategies. Investment performance remained strong over the long-term, positioning us well for future growth with 86% and 81% of our taxable fixed income and fundamental active equities above benchmarks or peer medium for the three-year respectively and for the five-year period. 90% of our taxable fixed income, 83% are fundamental active equity AUM is above benchmark or peer medium. In the US, 75% of our active mutual funds are in a Morningstar 4 or 5 rated fund and we continue to generate growth and capture market share across the US active mutual fund franchise in the first quarter.
In alternatives, we generated $6 billion of net inflows across liquid and illiquid strategies, led by private credit and infrastructure, and we're continuing to steadily deploy assets on behalf of our clients, including another $5 billion in the first quarter. Deployment activity was led by our climate finance partnership strategy that we announced last year which seeks to accelerate the flow of capital into climate related investments in the emerging markets. One of the biggest opportunities in alternatives in the years ahead will be the intersection of infrastructure and sustainability.
In response to the energy shocks caused by the war in Ukraine, many countries around the world are reevaluating their energy dependent disease and are looking for new sources of energy. This may mean increasing production of traditional energy sources in the near term, but I believe recent events will accelerate the shift towards greener sources of energy in many parts of the world over the long term and we will see a tremendous technological changes in the energy transition. This presents a significant long-term opportunity for investments in infrastructure, renewable, clean tech on behalf of our clients.
BlackRock has one of the largest renewable power platforms in the industry, managing over $8 billion in assets and climate -- client commitments, and we are expanding our transition focus investment strategies. BlackRock is committed to be helping clients navigate this energy transition. We are working with energy companies throughout the world, where essential in meeting societies energy needs and will play a critical role in any successful transition. To ensure the continuity of affordable energy prices during the transition, fossil fuels like natural gas will be important as a transition fuel.
BlackRock is also investing on behalf of our clients in natural gas pipelines. For example, in the Middle East, we invested in one of the largest pipelines for natural gas, which will help the region utilize less oil for power production. These investments are great example of helping countries go from dark brown to lighter brown and we substitute oil with a clear base fuel like natural gas. Client demand for sustainable investments more broadly also continue to be strong. We saw $19 billion of long-term net inflows into both our active and index sustainable strategies in the first quarter.
Our ability to partner with clients across the whole portfolio and quickly adapt to rapidly shifting market environment continues to drive demand for Aladdin's integrated end-to-end technology platform. BlackRock remains focused on investing in Aladdin to support its areas such as in its chapters of growth and extending its capabilities into areas like whole portfolio, private markets, wealth and sustainable investment solutions. We see the value proposition of Aladdin deeply resonating with clients and we generated a 13% technological service ACV growth over the -- year-over-year.
Clients are increasingly combining Aladdin with our newer offerings such as eFront or Aladdin Accounting, highlighting the benefits of our continuous innovations and investments as they are ahead of our clients needs. Our Aladdin client relationships are long term in nature and we will have historically seen industry-leading contract renewable rates. The recent market environment has also reinforced the need for offerings like Aladdin Wealth. Usage of Aladdin Wealth by financial advisors and our clients has increased by more than 40% during the first quarter as financial advisors look to assess portfolio risk to assess market exposures across every one of their clients across their entire business. We have over two dozen global client -- Aladdin Wealth clients and expect further growth to come from expansion into different wealth segments and in markets around the world. We are increasingly interest -- seeing interest from our clients that BlackRock is also studying digital assets and their associated ecosystem, including crypto assets, stablecoin, tokenization and permission block change, where we see a potential to benefit our clients in capital markets more broadly.
Over this week, we announced that BlackRock made a minority investment in Circle, a global Internet payment firm and the sole issuer of USD coin, a dollar-based fully reserved stablecoin, which is one of the fastest growing digital assets in the world. BlackRock is already the manager of US DC cash reserves and we look forward to be expanding our relationship to become the primary manager of the cash reserves. Over the past year that we have worked with Circle, we have been so impressed with their mission, their management team, their technology and their thoughtful approach to growth.
BlackRock has always led by listening to our clients by anticipating and embracing change and investing in ahead of their future needs. Let me say again, we are very honored by the deep trust our clients place in us. My recent meetings with our clients around the world have only strengthened my conviction in the opportunities that BlackRock has in front of us. I believe we have never been better positioned for our future.
As always, I'm incredibly proud of our employees who live our principles, who are staying true to our purpose and are focusing on the long-term needs of our shareholders, the long-term needs of our clients, the needs of our colleagues, and the needs and long-term issues that are impacting the communities where we work every day.
With that, let's open it up for questions.