Post on 22-Mar-2018
INTERIM REPORT AND UNAUDITED FINANCIAL STATEMENTSiSHARES II PLC
FOR THE FINANCIAL PERIODFROM 1 NOVEMBER 2016
TO 30 APRIL 2017
iSHARES II PLC
i S H A R E S I I P L C I N T E R I M R E P O R T [ 1 ]
Contents
General information 3
Background 5
Half yearly management report
Investment Managers report 11
Financial instruments and risks 30
Significant related party transactions 48
Financial Statements
Unaudited financial statements of the Company
Condensed income statement 51
Condensed statement of changes in net assets attributable to redeemable participating shareholders 51
Condensed balance sheet 52
Notes to the unaudited financial statements of the Company 53
Unaudited condensed Fund primary statements, schedules of investments, schedules of material purchases and sales, and notes:
iShares $ High Yield Corp Bond UCITS ETF 57
iShares $ TIPS 0-5 UCITS ETF 76
iShares $ TIPS UCITS ETF 80
iShares $ Treasury Bond 7-10yr UCITS ETF 86
iShares Corp Bond Sustainability Screened 0-3yr UCITS ETF 90
iShares Govt Bond 3-5yr UCITS ETF 102
iShares Govt Bond 7-10yr UCITS ETF 106
iShares Govt Bond 15-30yr UCITS ETF 111
iShares Index-Linked Gilts UCITS ETF 116
iShares Asia Property Yield UCITS ETF 120
iShares BRIC 50 UCITS ETF 125
iShares Core UK Gilts UCITS ETF 130
iShares Developed Markets Property Yield UCITS ETF 134
iShares Dow Jones Global Sustainability Screened UCITS ETF 143
iShares EM Infrastructure UCITS ETF 157
iShares EURO STOXX 50 ex-Financials UCITS ETF 162
iShares EURO STOXX 50 UCITS ETF 167
iShares FTSE MIB UCITS ETF EUR (Dist) 173
iShares Global Clean Energy UCITS ETF 178
iShares Global Infrastructure UCITS ETF 183
iShares Global Timber & Forestry UCITS ETF 192
iShares Global Water UCITS ETF 197
iShares J.P. Morgan $ EM Bond UCITS ETF 202
iShares JPXNikkei 400 EUR Hedged UCITS ETF (Acc) 215
iShares Listed Private Equity UCITS ETF 225
iShares MSCI AC Far East ex-Japan Small Cap UCITS ETF 230
iShares MSCI EM Islamic UCITS ETF 254
iShares MSCI EM Latin America UCITS ETF 263
iShares MSCI Europe SRI UCITS ETF 269
iShares MSCI Europe UCITS ETF EUR (Dist) 276
iSHARES II PLC
[ 2 ] i S H A R E S I I P L C I N T E R I M R E P O R T
Contents (continued)
Financial Statements (continued)
Unaudited condensed Fund primary statements, schedules of investments, schedules of material purchases and sales, and notes
(continued):
iShares MSCI Turkey UCITS ETF 288
iShares MSCI USA Dividend IQ UCITS ETF 292
iShares MSCI USA Islamic UCITS ETF 298
iShares MSCI World Islamic UCITS ETF 304
iShares STOXX Europe 50 UCITS ETF 317
iShares UK Property UCITS ETF 323
iShares US Aggregate Bond UCITS ETF 328
iShares US Property Yield UCITS ETF 367
Notes to the unaudited financial statements of the Funds 372
Other Information
Glossary 379
Supplementary Information 381
Disclaimers 409
This interim report and unaudited financial statements (the Report and Accounts) may be translated into other languages. Any such translation shall only contain the same information and have the same meaning as the English language Report and Accounts. To the extent that there is any inconsistency between the English language Report and Accounts and the Report and Accounts in another language, the English language Report and Accounts will prevail, except to the extent (and only to the extent) that it is required by law of any jurisdiction where the shares are sold, that in an action based upon disclosure in a Report and Accounts in a language other than English, the language of the Report and Accounts on which such action is based shall prevail. Any disputes as to the terms of the Report and Accounts, regardless of the language of the Report and Accounts, shall be governed by and construed in accordance with the laws of Ireland.
iSHARES II PLC
i S H A R E S I I P L C I N T E R I M R E P O R T [ 3 ]
1 All Directors are non-executive Directors. 2 The Investment Manager has appointed BlackRock Financial Management Inc. and BlackRock (Singapore) Limited, as sub-investment managers to perform certain portfolio management functions in respect of iShares $ High Yield Corp Bond UCITS ETF, iShares $ TIPS UCITS ETF, iShares $ Treasury Bond 7-10yr UCITS ETF, iShares Index-Linked Gilts UCITS ETF, iShares Core UK Gilts UCITS ETF, iShares Corp Bond Sustainability Screened 0-3yr UCITS ETF, iShares Govt Bond 3-5yr UCITS ETF, iShares Govt Bond 7-10yr UCITS ETF, iShares Govt Bond 15-30yr UCITS ETF, iShares J.P. Morgan $ EM Bond UCITS ETF and iShares US Aggregate Bond UCITS ETF.
General information
Board of Directors1 BlackRock (Singapore) Limited
Paul McNaughton (Chairman) (Irish) 20 Anson Road
Paul McGowan (Irish) #18-01
Barry ODwyer (Irish) Singapore 079912
Karen Prooth (British) Singapore
Teresa OFlynn (Irish)
Depositary
Audit Committee Members State Street Custodial Services (Ireland) Limited
Paul McGowan (Chairman) 78 Sir John Rogersons Quay
Paul McNaughton Dublin 2
Ireland
Nomination Committee Members
Paul McNaughton (Chairman) Registered office of the Company
Paul McGowan J.P. Morgan House
Barry ODwyer International Financial Services Centre Dublin 1
Manager Ireland
BlackRock Asset Management Ireland Limited
J.P. Morgan House Legal Advisors to the Company
International Financial Services Centre William Fry
Dublin 1 2 Grand Canal Square
Ireland Dublin 2
Ireland
Administrator and Registrar
State Street Fund Services (Ireland) Limited Independent Auditors
78 Sir John Rogersons Quay PricewaterhouseCoopers
Dublin 2 Chartered Accountants and Registered Auditors
Ireland One Spencer Dock
North Wall Quay
Company Secretary Dublin 1
Sanne Ireland
Fourth Floor
76 Lower Baggot Street Representative in Switzerland
Dublin 2 BlackRock Asset Management Schweiz AG
Ireland Bahnhofstrasse 39
8001 Zurich
Investment Manager, Promoter and Securities Lending Agent Switzerland
BlackRock Advisors (UK) Limited
12 Throgmorton Avenue Paying Agent
London EC2N 2DL Citibank N.A., London Branch
England Citigroup Centre
25 Canada Square
Sub-Investment Managers2 Canary Wharf
BlackRock Financial Management Inc. London E14 5LB
40 East 52nd Street England
New York
NY 10022
United States
iSHARES II PLC
[ 4 ] i S H A R E S I I P L C I N T E R I M R E P O R T
General information (continued)
Paying Agent in Switzerland Austrian Paying and Information Agent
State Street Bank International GmbH UniCredit Bank Austria AG
Munich, Zurich Branch Attn: 8398/Custody
Beethovenstrasse 19 Julius Tandler Platz 3
CH-8027 Zurich 1090 Vienna
Switzerland Austria
German Paying and Information Agent
Commerzbank AG
Theodor-Heuss-Allee 50
60486 Frankfurt am Main
Germany
The Company is duly registered with the Comisin Nacional de Mercado de Valores in Spain under number 802.
iSHARES II PLC
Background
i S H A R E S I I P L C I N T E R I M R E P O R T [ 5 ]
iShares II public limited company (the Company) is organised as an open-ended investment Company with variable capital. The Company was
incorporated in Ireland on 16 December 1999 with limited liability and segregated liability between its Funds and is organised under the laws of
Ireland as a Public Limited Company (plc) pursuant to the Companies Act 2014 and the European Communities (Undertakings for Collective
Investment in Transferable Securities) Regulations, 2011 (as amended) (the UCITS Regulations) and is regulated by the Central Bank of Ireland
(the CBI).
The term Fund shall be deemed to mean either a Fund of the Company, or if the context so requires, the Manager or its delegate acting for the
account of the relevant Fund. The term BlackRock is used to represent BlackRock Advisors (UK) Limited. The investment objectives and
policies of each Fund are set out in the prospectus and the relevant supplemental prospectus.
The Company is structured as an umbrella Fund and comprises separate Funds (Funds) of the Company. Each Fund of the Company
comprises a distinct portfolio of Investments. The Shares of each Fund may be issued with different rights, features and on different terms and
conditions to those of the other Funds. Shares of a Fund may be divided into different share classes with different dividend policies, currency
hedging and Valuation Currencies and may therefore have different fees and expenses.
On 2 November 2016, the Board of Directors of the Company notified shareholders of their intention to launch multiple share classes within most
of the existing sub-funds of the Company and also other sub-funds across the Irish iShares range and an amendment to the definition of Duties
and Charges.
While assets and liabilities that are specific to a share class within a Fund would be attributable to (and should be borne by) only that share class,
there is no segregation of liabilities between share classes as a matter of Irish law. Due to the lack of segregation of liabilities, th