Item No.8:

Annual Presentation by BlackRock Institutional - Large-Cap Core Manager (March 25, 2015, Regular Retirement Board Meeting)

INVESTMENT MANAGER SUMMARY

RP - $1, 163.4 Million HP - $197.4 Million

8

Los Angeles Department of Water and Power Russell 1000 Index Fund Review

25 March 2015

Table of contents I.

BlackRock Update

II.

Index Investment Process and Discipline

III.

Market Overview

IV.

Performance Review

V.

Portfolio Review and Characteristics

VI.

Fee Schedule

1.

Appendix

For use with institutional investors only — proprietary and confidential

3

I. BlackRock Update

BlackRock at a glance

BlackRock Mission Statement Create a better financial future for our clients by building the most respected investment and risk manager in the world

BlackRock facts *

$4.65 trillion managed across asset classes

 Established in 1988

 NYSE: BLK  $4.65 trillion assets under management  More than 12,000 employees

Active Fixed Income 701 bn

Passive Fixed Income 692 bn

 More than 1,800 investment professionals Alternatives1 111 bn

 Offices in over 30 countries

Multi-Asset 378 bn Cash Management 296 bn Advisory 22 bn

 28 primary investment centers  Clients in over 100 countries

Active Equity 293 bn

 Over 700 iShares® ETFs  Through BlackRock Solutions, the Firm provides risk management and enterprise investment services for over 175 clients  Financial Markets Advisory business managed or advised on over $8 trillion in asset and derivative portfolios  Transition Management team partners with clients to save costs and reduce risks when changing investment exposures

Passive Equity 2.16 tn

Assets as of 31 December 2014 1 Includes commodity and currency mandates

* As of 31 December 2014

For use with institutional investors only — proprietary and confidential

7

The LADWP Account Coverage Team Name

Title

Phone

Email

Jeremy Watt

Director

(415) 670-7208

[email protected]

Tom Holmes

Associate

(415) 670-4120

[email protected]

San Francisco Office Address 400 Howard Street San Francisco, CA 94105

For use with institutional investors only — proprietary and confidential

8

II. Index Investment Process and Discipline

BlackRock’s Beta Strategies Platform Global leader in Index Equity assets1  We seek to deliver consistent performance with precise and reliable outcomes for our clients  Thousands of skillful and thoughtful decisions made each year for swift response to market trends and client demands

Extensive and flexible platform for beta strategies  Over 2,000 funds managed against 650+ benchmarks  Daily liquidity with T-1 notification (for US equities) and T-2 notification (for non US equities)2  Modular fund structure and asset allocation platform facilitates custom and outcome oriented solutions

Total Beta Strategies risk managed assets of $2.9 trillion USD

Distribution of assets by region of mandate

In billions USD $2.9T

$2.8T

Developed Non-US 38%

$2.1T $1.7T

805

734 439

560

851

1,019

1,281

2011

2012

2013

Institutional AUM

US Equities 51%

1,400 2014

iShares® AUM

IAA Risk Managed

Source: BlackRock, Inc. and its affiliates (together “BlackRock”) as of 31 December 2014 1 In terms of AUM. Source: Pensions & Investments 2 Frontier markets commingled fund currently open bi-monthly

For use with institutional investors only — proprietary and confidential

Commodities 1%

Emerging Markets 10%

11

BlackRock is a leading global provider of equity index solutions We have a history of consistent performance and low tracking error

BlackRock’s Key Differentiators:

Seek to provide:

 We believe skill and ingenuity can lead to precise, reliable outcomes

Seek performance with precision

Clients first

 Thousands of decisions each year provide opportunities to preserve value for clients

Consistent returns with low costs

 Backed by experienced teams specializing in tax, trading, risk oversight and securities lending



We put clients at the center of our thinking and minimize potential conflicts of interest



Scale and diversity of our platform helps lower costs for clients



Strive for consistent performance as planned

Minimal risk at less cost

 Relentless in our quest to improve beta strategies

Constant evolution

 Rapid and flexible response to trends, new markets and client demands  Our scale and technology innovations enhance our ability to deliver consistent performance

For use with institutional investors only — proprietary and confidential

Flexible range of solutions to help meet diverse client needs

BES-0042 12

Over 40 years of experience driving beta forward We constantly reinvest in and reinvent our business so our clients have access to high quality Beta solutions  Drive the industry forward through our ability to create specialized, innovative investments afforded by our scale and depth of expertise  Forge new ground for clients — first manager to offer opportunities in equity index developed, emerging, and frontier markets  Evolve capabilities to continuously deliver on emerging trends — smart beta, global benchmarking, overlay strategies  Serve as an index advocate on behalf of clients and as a key partner to index providers seeking our practitioner knowledge

40 years of Beta Strategies — Continual evolution of products, technology and capabilities BlackRock Index Equity RMA1 Index pioneer and innovator

Defined contribution capabilities

Emerging Market Equity Index

World Equity Benchmark Shares (WEBS)

Triple A: asset allocation PM tool

iShares ExchangeTraded Funds

Eliminated dividend flipping

EAFE Index Plus

Risk model enhancements

Frontier Markets

Minimum Volatility ETFs

Fundamentally weighted strategies

Journey Mgmt

1971

2014

Fund of fund structures EAFE Equity Index Securities Lending

Factor ETFs

Equity and currency hedging

Russell Index Funds First 401(k) Target Date Fund (LifePath)

Investment Analysis: index portfolio management tool

Income strategy ETFs EAFE Small Cap

EM Directed FX

Aladdin Migration

Daily openings for all funds

T-2 for International

Currency Hedged iShares ETFs

Emerging Markets Small Cap

1 Risk Managed Assets (RMA) represents total asset values of the portfolio risks managed by Index Asset Allocation group

For use with institutional investors only — proprietary and confidential

BES-0042 13

Beta strategies continue to be a growing portion of client portfolios Investors today are enhancing their passive allocations in three ways:

 Introducing smart beta as complement to traditional market cap indices

 Migrating to broader mandates — segregated index mandates are re-aggregated into one  Going global — ACWI / ACWI fastest growing index strategy

IMI1

• • • •

is the

 Moving EM into mainstream — no longer niche; gain EM exposure via global indices

35 +48%

$0.71 +14%

$6.38

Dom Index

20 $15

15 $8

10 +11%

Global Index

$ billions

25

$0.64

$1.59

$29

30

$0.05

EM Index

 Expressing tactical asset allocation views through synthetic beta

Growth in smart beta over past 4 years

2012

2005

 Implementing synthetic passive exposure over an alpha strategy  Creating capital efficient, liquid, rebalancing strategies

Minimum volatility Fundamentally-weighted Factor-based Economic exposure

Declining home equity bias and increasing global focus2

$3.16

Custom synthetic overlays

Complementary styles

Comprehensive core

CAGR

As of 31 December 2013. Source: Boston Consulting Group, Strategic Insight, eVestment Alliance, BLK Corporate Strategy estimates. AUM figures represent industry AUM in $ trillions (excl MMFs & Instl Alts) 1 All Country World Index Investable Market Index 2 Represents $ in trillions from perspective of home country investor

5

$1

0

2010

2011

2012

2013

Source: BlackRock smart beta (non-market cap weighted strategies) assets under management

For use with institutional investors only — proprietary and confidential

BES-0042 14

Beta Strategies: Americas Index Equity

Beta Strategies Leadership Amy Schioldager Global Head of Beta Strategies

Americas Index Equity

Strategy Corin Frost, CFA Global Head of Index Product Strategy

Alan Mason Head of Americas Beta Strategies

North America Peter Sietsema, CFA Senior Portfolio Manager

Institutional

Defined Contribution

Alternative

Research

Index Research

US Strategy

Christopher Bliss, CFA Head of Institutional Portfolio Management

Amy Whitelaw Head of DC Portfolio Management

Creighton Jue, CFA Head of Alternative Beta

Matthew Lee, Ph.D. Head of Research

Stephanie Allen Head of Index Research

Scott Dohemann, CFA Head of US Index Strategy

International Developed

International Emerging

Index Allocation

Rachel Aguirre Senior Portfolio Manager

Matt Waldron, CFA Senior Portfolio Manager

Maya Tussing Senior Portfolio Manager

U.S. Cara Barr Kristen Dickey Timothy Murray, CFA Jerry Sun

Research

Portfolio Management

Jacqueline Wolk

North America

International Developed

International Emerging

Index Allocation

Defined Contribution

Alternative

Research Officer

Index Analyst

+6 Portfolio Managers

+6 Portfolio Managers

+4 Portfolio Managers

+3 Portfolio Managers

+6 Portfolio Managers

+6 Portfolio Managers

+3 Officers

+7 Analysts

EMEA

Andrew Graver* Jack Mortensen* Timothy Parsons* Flora Herries*

APAC Ben Garland, CFA* Colin Zhang*

As of 1 Dec 2014 * Located outside of the US

For use with institutional investors only — proprietary and confidential

BES-0042 15

Core investment philosophy of total performance management We believe that superior investment outcomes are best achieved through a disciplined, objective process to manage return, risk and cost

Return  Performance as planned with value-added portfolio management

Return

 Flexible strategies and solutions

Risk  Proprietary portfolio & risk management system helps manage investment and operational risk

Total Performance Management

Risk

Cost

Cost

 Trading cost integrated into portfolio construction using proprietary transaction cost models  Potential for reduced transaction costs through netting of client flows  Focus on best execution for all external trading, including FX

For use with institutional investors only — proprietary and confidential

BES-0042 16

Our index investment management process is anything but passive Deep expertise and investment skill underpin consistent historical performance  BlackRock’s beta portfolios are managed using a team approach to strategy, portfolio management, research, and trading

The ability to capture gains on hundreds of investment decisions adds up over time  Portfolio managers’ decision-making process involves deciding on corporate actions such as dividends, stock splits, spinoffs, rights offerings, and mergers & acquisitions

Detail-intensive investment decisions in pursuit of performance with precision and reliability

Benchmark Knowledge

Portfolio Construction

Efficient Trading

 Analysis of forthcoming index changes

 Teams of portfolio managers dedicated by region

 Industry’s largest internal market place for netting client flows

 Audit daily updates from index providers

 Supported by leading technology and risk models

 Best execution sought on all trades

 Develop trade strategies to thoughtfully incorporate index events

 Rapid dividend reinvestment and cash equitization

 Economies of scale

Performance & Oversight  Daily review by portfolio managers  Monthly Investment Review Committee  Independent Risk & Quantitative Analysis Group

 Dedicated trading research team

Risk Management Leverage RQA and BlackRock’s proprietary Aladdin® system to help identify, monitor and minimize risk

For use with institutional investors only — proprietary and confidential

BES-0042 17

Factors PMs use to preserve value Our portfolio managers use skill and ingenuity in pursuit of creating precise and reliable outcomes, and have delivered benchmark returns as planned each year Beta PMs are experts in the capital markets they transact — actively driving hundreds of decisions each year

External

Local market convention

Macro economic events

PMs evaluate aggregate views, activities, and sentiments of other investors, including: 

Expected activity of other investors

Capital Markets Perspective



Market sentiment

Benchmark

  

Beta Portfolio Managers Corporate actions



Liquidity Profile

Fund-Specific Factors

PMs have detailed understanding of benchmark changes in context of each Fund:  

Benchmark methodology

Risk model and optimization

Net flows of BLK and other indexers Expected activity of profit-motivated investors Local market conventions and behaviors Macro economic events (Fed announcement, jobs report) Company earnings releases Market sentiment that could affect rebalancing

  

Ensure funds are fully invested in light of client flows or dividend payments Construct each trade to explicitly trade off risk and cost Carefully evaluate corporate actions to help minimize risk and preserve value Develop creative trading strategies for less liquid positions Partner with index providers regarding benchmark changes

For use with institutional investors only — proprietary and confidential

BES-0042 18

Beta Strategies is anything but passive — Google corporate action

Background

Impact

Ensuring the interests of our clients and advocating on their behalf are high priorities

 Google announced a distribution of new class of non-voting C shares to existing shareholders of outstanding shares of Class A and Class B common stock

 S&P and Russell originally planned to delete the Google Class A shares from their respective indexes, and double the weight of the Class C shares  Google represents ~2% in S&P 500 and Russell 1000. Beta Strategies engaged with indexers and Google on potential risk of original treatment including tracking error, tax implications, and price volatility

Risks considered Liquidity Capital structure Capital gains Tracking error Market impact

Delete Class A Shares (Original)

Retain both Class A and C Shares (Final Decision)

    

    

BlackRock-driven outcome: S&P and Russell revised published methodology to maintain both Class A and C shares, avoiding $45 billion in unnecessary trading and additional price volatility The issuers referenced is an example of an issuer that BlackRock considers to be well known and that may fall into the stated sector. BlackRock may or may not own any securities of the issuers referenced and, if such securities are owned, no representation is being made that such securities will continue to be held.

For use with institutional investors only — proprietary and confidential

BES-0042 19

Deliberate balancing of risk, return, and costs: UAE and Qatar reclassification from Frontier to Emerging Markets 100% 80% 60%

Pre-positioning Investors buy into markets; EM flat

Reclassification Announcement June 11, 2013

40%

SAIR Announcement 10 Qatar, 9 UAE adds. Market turnover: $1.6M BLK trading strategies create value

Effective date May 29, 2014. Prices peak

20% 0% -20% May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14 MSCI UAE

Benchmark context  UAE and Qatar promoted to EM status by MSCI effective May 30th, 2014  UAE and Qatar to comprise appx 50 bps each in MSCI EM Index

Feb-14

Mar-14

MSCI Qatar

Market context

Apr-14

May-14

MSCI Emerging Markets

Value preservation

 Low liquidity, large trade size

 Globally, executed ~$1.5 billion in Qatar / UAE trades over several weeks

 Operational complexity & immature local market structure

 Cautious approach to liquidity and risk management

 Significant pre-positioning

 Generated $55 million in value for BlackRock clients

 Net expected buy of ~$1bn in each market was 10 – 15x ADV

Source: BlackRock, Bloomberg, as of June 2014

For use with institutional investors only — proprietary and confidential

BES-0042 20

Russell Reconstitution 2014 June 27 Rebalance trade intra-day performance

One-way rebalance turnover 2014

2013

2012

2011

2010

Russell 1000

2.17%

2.32%

1.82%

2.69%

3.92%

Russell 2000

10.11%

9.01%

10.05%

10.48%

9.50%

Russell 1000 Buys vs Sells

A unique year for Russell reconstitution  Late on effective date, performance of both Russell 1000 and 2000 moved in the opposite direction of indexer flows  Business Development Companies (BDCs) were removed •

This resulted in 2 deletions from R1000 at 5 bps turnover, and 33 deletions from R2000 at 1.19% of the index

All R1 Buys

All R1 Sells

Russell 2000 Buys vs Sells

2014 BlackRock fund performance  Maintained tight risk controls and captured $10.5 million in value through specific trading strategies  Total gross value of our trade was $49.8 billion •

Netted flows of over $12 billion per side (49%) thereby reducing trading costs for BlackRock clients

 Processed over 160,000 orders in Aladdin vs. an average of 30,000 per day Sources: BlackRock, Russell, Bloomberg, Barclays l. Performance calculated on a trade-weight basis Past performance is no guarantee of future results

For use with institutional investors only — proprietary and confidential

All R2 Buys

All R2 Sells

BES-0042 21

BlackRock’s scale and internal network for netting client flows delivers the potential to significantly lower transaction costs BlackRock transaction costs vs. ex-ante estimates1 Average client cost in 2013, as of Dec 31, 2013

Transaction costs (bp)

25 21 20

17 15

15

13 10

10

8

7 4

5 1

2

1

2

5

6

3

1

0 Buy

Sell S&P 500

Buy

Sell MSCI EAFE

Buy

Sell

MSCI ACWI ex-US IMI Actual Client T-Cost

Buy

Sell MSCI EM

T-Cost Estimate Pre Netting of Flows

The scale of BlackRock’s CTFs and global trading footprint results in reduced T costs:  On average, we net internally approximately 40 – 50% of client flows  Market trades reflect the industry’s most competitive commission rates

Source: BlackRock. BlackRock Flagship Index Funds shown. 1 Estimated transaction costs includes commissions and taxes based on BlackRock’s current standard negotiated rates Netting of client flows is not guaranteed, and may depend on several other factors, including but not limited to, client flows and external trading markets. BlackRock’s size facilitates potential ability to net client flows and realize transaction cost savings.

For use with institutional investors only — proprietary and confidential

BES-0042 22

Precision performance, as planned Over the past 10 years, BlackRock’s S&P 500® Index Equity Collective Fund matched or beat the benchmark 97% of the time S&P 500 Index Fund A performance — Excess returns Matched or beat: 97% 91

90 80 70 60 50 40 30

-5 to -4

-4 to -3

0

5

4

1

1

1

1

1 7 to 8

-6 to -5

0

6 to 7

0

5 to 6

0

4 to 5

0

-2 to -1

0

-3 to -2

0

-7 to -6

10

3 to 4

16

20

-8 to -7

# of times benchmark matched or beat

100

0 8 to 9

2 to 3

1 to 2

0 to 1

-1 to 0

0

Performance in relation to benchmark (BPS) Source: BlackRock, Inc. and S&P, as of 31 December 2014. Reported on an annual basis and gross of fees Past performance is no guarantee of future results. It is not possible to directly invest in an unmanaged index. Index returns include the reinvestment of dividends.

For use with institutional investors only — proprietary and confidential

BES-0042 23

Key takeaway Our approach to Beta: anything but passive Investors today demand more reliable, precise returns and innovative ways to use beta BlackRock Beta Strategies’ approach is focused on:

People Team combines skill and ingenuity in seeking to enhance outcomes

Performance Seek to provide consistent performance as planned

Process Rooted in deep understanding of benchmarks and capital markets

Platform Scale and technology innovations enhance ability to deliver consistent performance and minimize costs

For use with institutional investors only — proprietary and confidential

Products Flexible spectrum of solutions featuring more than 1,000 funds covering 350+ benchmarks

BES-0042 24

Summary of LADWP Investment Guidelines

Index:

Russell 1000 Index

Fund Guidelines:

The Russell 1000 Index Fund shall be invested and reinvested in a portfolio of Equity Securities with the objective of approximating as closely as practicable the capitalization weighted total rate of return of the segment of the United States market for publicly traded equity securities represented by the 1,000 largest capitalized companies. The criterion for the selection of investments shall be the Russell 1000 Index. When deemed appropriate by the Manager, the Manager may invest a portion of the Russell 1000® Index Fund in stock index futures contracts for the purpose of acting as a temporary substitute for investment in equity securities. The Russell 1000 Index Fund will not engage in speculative futures transactions. For the purposes of these investment guidelines the defined term "Equity Securities" shall mean common stocks and forms of equity securities (e.g., preferred stock), American Depository Receipts, European Depository Receipts, Global Depository Receipts and Investment Company Shares (as defined below) where such investment company portfolio seeks to replicate or outperform the performance of an equity index selected by the Manager.

Tracking Error:

+/- 10 basis points annually

The LADWP accounts are managed in strict compliance with the Plan’s guidelines

For use with institutional investors only — proprietary and confidential

25

III. Market Overview

On balance, 2014 was a decent year, but will be challenging from here.

Asset Class Returns, 2014

Sources: Thomson Reuters, BlackRock Investment Institute, data through 31 December 2014 For use with institutional and professional investors only – proprietary and confidential

29

Valuation of Global Equity and Bond Markets Valuations range from sky-high (government bonds) to average (most credit and developed equities). We continue to prefer stocks over bonds and cash, even with volatility expected to rise. Valuations by Percentile vs. Historical Norms

Fixed Income

Equities

100 90

Expensive

80 Percentile Ranking

70 60 50

Average

40

30 20 10

Cheap

0

November 2014 Source: BlackRock Investment Institute (BII) and Thomson Reuters as of 10/31/14. Valuation percentiles are based on an aggregation of standard valuation measures versus their longterm history. Government Bonds are 10-year benchmark issues. Equity valuations are average percentile ranks versus available history of earnings yield, cyclically adjusted earnings yield, trend real earnings, dividend yield, price to book, price to cash flow and forward 12-month earnings yield For use with institutional and professional investors only – proprietary and confidential

30

The Great Equity Rerating  Valuations have driven equities more than earnings growth.  This is what happens in a bull market and ends when valuations become excessive and/or policy tightens.  Earnings growth has to take over to avoid a bubble.  Earnings growth now coming through in most regions, but requires leverage given margin levels. 12-Month Equity Returns by Source

Sector allocation should depend on valuation. Defensives and Dividend-oriented sectors are overvalued while cyclical sectors are reasonably priced. Cons Staples Health Care Utilities Cons Discr Technology Telecom

Energy Industrials Materials Financials 0

5

10

IBES 12-Month Forward P/E Ratio 10-year average

15

20

10-year average

Source: Thomson Reuters Datastream, BlackRock Investment Institute, as of 01/15/15 Sources: Thomson Reuters, MSCI and BlackRock Investment Institute, January 2015 For use with institutional and professional investors only – proprietary and confidential

31

Opportunities: Equities U.S.

Reflationary monetary policies have supported the bull market, but can grind higher.

We remain optimistic for 2015…

…despite less accommodation.

S&P 500 Year End Target

S&P 500 Performance (%) in the last 3 tightening cycles 10

Federated Investors

2350 8

Morgan Stanley

2275

JP Morgan Chase

2250

Prudential Int'l

2250

6

2

Citi Research

2200

Columbia Management

2200

0

Bank of America Merrill Lynch

2200

-2

BlackRock 2100

-6

Goldman Sachs

2100

-8

2050

2250

2450

-5

8

7 4.7

-3

-1

1994

1999

6.3

-4.0

-6

3 months following

Sources: WSJ, BlackRock. 2014 year end S&- 500 value was 2058.90. As of Dec 15, 2014.

9

3

-4

2160

Barclays

1850

9

4

2004

6 months following

Average

12 months following

Sources: Goldman Sachs

For use with institutional and professional investors only – proprietary and confidential

32

Opportunities: International Equities We would focus on opportunities in certain international markets. Japan remains the most attractively priced developed market, with catalysts for further stock gains on the horizon. P/B and Dividend Yield by Country

Japanese Buybacks and Dividend Payouts

5.0 Brazil

20

8%

15

6%

10

4%

5

2%

UK Australia

4.5

4.0

South Africa

Hong Kong

Switzerland

3.0 Canada

2.5 China

US

2.0 Japan

1.5

Trillion Yen

Dividend Yield, in %

Europe

Return on Equity

Poland

3.5

0

Mexico

0% 05

South Korea

06

Buyback

07

08

09

Dividends

10

11

12

13 14E 15E

Return on equity (right-axis)

1.0 1.0

1.5

2.0

2.5

3.0

Price-to-Book Ratio

Sources: Goldman Sachs, November 2014. Note: The analysis is based on 1,689 Tokyo Stock Exchange-listed companies. 2014 and 2015 are Goldman Estimates

Source: Bloomberg, December 2014. Past performance is no guarantee of future results.

For use with institutional and professional investors only – proprietary and confidential

33

Opportunities: Fixed Income – Developed Rates 2014 continued to defy the consensus as global interest rates continued to rally. Now it’s a matter of U.S. vs. the global. US yield curve

Global Rates- Where to get safe haven yield?

5.0

4.00

4.5 3.50 4.0 3.5

2.50

3.0 2.75

2.00

2.17

1.50

2.5

2.0 1.5

1.65 1.00

Yield (%)

Yield (%)

3.00

0.66

1.0

0.50

0.5

0.00 2s

5s

Jan-14

10s

Jun-14

30s

Jan-15

Sources: Bloomberg. Note: data labels show value for maturities as of 1/1/2015.

0.0 Jan-14

Apr-14

Jul-14

UST 10

UK 10

German 10

Australia 10

Italy 10

Spain 10

Oct-14 Japan 10

Jan-15

Sources: Bloomberg. As of Jan 8,2015

For use with institutional and professional investors only – proprietary and confidential

34

Opportunities: Fixed Income – High Yield After a strong recovery post the Great Recession, many are asking have we reached the end of the cycle. One of the best Investments post recession1 20%

16.7%

Total Return (%)

16% 10.2%

12%

2.6%

2.1%

4%

3.4%

2.1%

0% -4%

-0.1%

Valuations are no longer a screaming bargain…

… but, the asset class is strong fundamentally. 4.5x

16

Current = 4.4x

14

4.0x

12

3.5x

10

3.0x

8

2.5x

LT average = 3.1x

6

2.0x

4

1.5x

2 Jan-09

Jan-07

Jan-05

Jan-03

Jan-01

Jan-99

Jan-97

Jan-95

Jan-93

Jan-91

Jan-89

Jan-87

Jan-85

1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

1.0x

0 Jan-83

High Yield YTW/ UST T 5 year Yield

12.7%

8.5%

6.8%

8%

11.2%

17.8%

EBITDA-Capex/Interest Expense

EBITDA/Interest Expense

Sources: Bloomberg, JP Morgan 1 Performance Summary, December 2008 to November 2014 – various asset classes

For use with institutional and professional investors only – proprietary and confidential

35

Key Risks to Macro view and Asset Allocation

•

The Fed’s transition to a normalized monetary policy framework creates more disruption than expected.

•

US growth is not enough to offset the weak GDP from global peers. Global growth continues to suffer.

•

The ECB’s expected QE increases the balance sheet, yet markets front run and effect is not long lasting, leaving inflation well below the target. Europe falls into deflation (further) deterring investment at the corporate and household sector.

•

Oil continues to drop forcing a capitulation in the HY sector and more reductions in the Energy sector lowering S&P 500 overall cap ex projections.

•

China’s delicate balancing act between growth and reforms forces GDP to print lower than target. Stimulus measures offered only add to overleveraged economy and shadow banking risks.

Sources: BlackRock.

For use with institutional and professional investors only – proprietary and confidential

36

IV. Performance Review

LADWP Performance Overview

Our investment objective for the Los Angeles Department of Water and Power Fund is to replicate the risk and return of the Russell 1000 Index. Fund (gross)

Fund (net)

Index

Difference

Water and Power Retirement Plan: $1,163,394,586 Retirement Health Benefits Fund: $197,355,506 1 month

5.78%

5.78%

5.78%

0.00%

Year-to-date

2.88%

2.88%

2.87%

0.01%

12 months trailing

14.92%

14.91%

14.88%

0.03%

3 years annualized

18.18%

18.17%

18.14%

0.03%

5 years annualized

16.44%

16.43%

16.39%

0.04%

10 years annualized

8.36%

8.35%

8.30%

0.05%

Since inception annualized

9.52%

9.51%

9.47%

0.04%

Source: BlackRock As of 2/28/2015 Benchmark is the Russell 1000 Index Inception Date: 08/07/2003. On 8/31/2010, LADWP redeemed out of the Large Cap Index Trust managed by BlackRock Investment Management, LLC and transitioned into the Russell 1000 Index Fund managed by BlackRock Institutional Trust, N.A

For use with institutional investors only — proprietary and confidential

39

LADWP Performance Overview

Our investment objective for the Los Angeles Department of Water and Power Fund is to replicate the risk and return of the Russell 1000 Index. Fund (gross)

Fund (net)

Index

Difference

Water and Power Retirement Plan: $1,097,268,254 Retirement Health Benefits Fund: $186,137,992 2005

6.27%

6.26%

6.27%

-0.01%

2006

15.62%

15.60%

15.46%

0.14%

2007

5.76%

5.74%

5.77%

-0.03%

2008

-37.63%

-37.65%

-37.60%

-0.05%

2009

28.48%

28.46%

28.43%

0.03%

2010

16.80%

16.78%

16.75%

0.03%

2011

1.56%

1.55%

1.50%

0.05%

2012

16.47%

16.46%

16.42%

0.04%

2013

33.14%

33.13%

33.11%

0.02%

2014

13.27%

12.26%

13.24%

0.02%

2015 YTD

2.88%

2.88%

2.87%

0.01%

Since inception annualized

9.52%

9.51%

9.47%

0.04%

Source: BlackRock As of 2/28/2015 Benchmark is the Russell 1000 Index Inception Date: 08/07/2003. On 8/31/2010, LADWP redeemed out of the Large Cap Index Trust managed by BlackRock Investment Management, LLC and transitioned into the Russell 1000 Index Fund managed by BlackRock Institutional Trust, N.A For use with institutional investors only — proprietary and confidential

40

LADWP Performance Overview

24.00%

18.00%

12.00% Fund (gross) Fund (net)

6.00%

Benchmark 0.00% 1 month

YTD

12 3 years 5 years 10 years Since months inception Fund (gross)

Fund (net)

Index

Difference

1 month

5.78%

5.78%

5.78%

0.00%

Year-to-date

2.88%

2.88%

2.87%

0.01%

12 months trailing

14.92%

14.91%

14.88%

0.03%

3 years annualized

18.18%

18.17%

18.14%

0.03%

5 years annualized

16.44%

16.43%

16.39%

0.04%

10 years annualized

8.36%

8.35%

8.30%

0.05%

Since inception annualized

9.52%

9.51%

9.47%

0.04%

Source: BlackRock As of 2/28/2015 Benchmark is the Russell 1000 Index Inception Date: 08/07/2003. On 8/31/2010, LADWP redeemed out of the Large Cap Index Trust managed by BlackRock Investment Management, LLC and transitioned into the Russell 1000 Index Fund managed by BlackRock Institutional Trust, N.A For use with institutional investors only — proprietary and confidential

41

LADWP Performance Overview 40.00%

20.00%

0.00%

Fund (gross) Fund (net) Benchmark

-20.00%

-40.00% 2008

2010

2012

2014

Since inception annualized

Fund (gross)

Fund (net)

Index

Difference

2008

-37.63%

-37.65%

-37.60%

-0.05%

2009

28.48%

28.46%

28.43%

0.03%

2010

16.80%

16.78%

16.75%

0.03%

2011

1.56%

1.55%

1.50%

0.05%

2012

16.47%

16.46%

16.42%

0.04%

2013

33.14%

33.13%

33.11%

0.02%

2014

13.27%

12.26%

13.24%

0.02%

2015 YTD

2.88%

2.88%

2.87%

0.01%

Since inception annualized

9.52%

9.51%

9.47%

0.04%

Source: BlackRock, As of 2/28/2015 Benchmark is the Russell 1000 Index Inception Date: 08/07/2003. On 8/31/2010, LADWP redeemed out of the Large Cap Index Trust managed by BlackRock Investment Management, LLC and transitioned into the Russell 1000 Index Fund managed by BlackRock Institutional Trust, N.A For use with institutional investors only — proprietary and confidential

42

LADWP Portfolio Attribution - Sectors Our investment objective for the Los Angeles Department of Water and Power Fund is to replicate the risk and return of the Russell 1000 Index. As this is a passive portfolio, portfolio attribution of sectors is not applicable.

For use with institutional investors only — proprietary and confidential

43

LADWP Portfolio Attribution – Top Contributors/Detractors Our investment objective for the Los Angeles Department of Water and Power Fund is to replicate the risk and return of the Russell 1000 Index. As this is a passive portfolio, contributors/detractors are at index levels. There are no active over/underweights for attribution.

For use with institutional investors only — proprietary and confidential

44

LADWP Portfolio Attribution – Stock Selection Our investment objective for the Los Angeles Department of Water and Power Fund is to replicate the risk and return of the Russell 1000 Index. As this is a passive portfolio, stock selection is not performed. Individual securities are weighted at index levels, therefore attribution is not applicable.

For use with institutional investors only — proprietary and confidential

45

V. Portfolio Characteristics

Russell 1000® Equity Index Fund Characteristics Sector diversification

Characteristics Strategy

As of 31 December 2014

Russell 1000® Index

12.71 12.70

Consumer discretionary Total fund assets

$35.41B

Number of holdings

8.99 8.98

Consumer staples

1,043

7.83 7.84

Energy

Top 10 holdings

17.42 17.44

Financials

Fund %

Index %

Apple Inc.

3.16

3.16

Exxon Mobil Corporation

1.89

1.89

13.95 13.95

Health care 11.17 11.16

Ru-1K-Idx-A-Ch

Industrials Microsoft Corporation

1.82

1.82

Johnson & Johnson

1.41

1.41

Berkshire Hathaway Inc. Class B

1.31

1.31

Wells Fargo & Company

1.24

1.24

General Electric Company

1.20

1.20

Procter & Gamble Company

1.17

1.17

JPMorgan Chase & Co.

1.13

1.13

Chevron Corporation

1.01

1.01

19.05 19.04

Information technology 3.54 3.53

Materials

2.11 2.11

Telecommunication services

3.23 3.22

Utilities

0

8

16

24 Fund

Index

Portions of the above characteristics are based on benchmark data as the portfolio fully replicates benchmark and is for analytical purposes only. Index data may differ to those published by the Index due to different classification criteria. Breakdowns may not sum to total due to rounding, exclusion of cash, STIF, and statistically immaterial factors Sources: BlackRock, FactSet Intended for use in a one-on-one presentation with institutional trust clients or prospective eligible institutional trust clients of BlackRock Institutional Trust Company. N.A. (“BTC”)

CTF-0624 49

Portfolio Value Water and Power Retirement Plan Initial Value as of 31 August 2010

$531,877,753

Contributions

$377,541,879

Withdrawals

($384,000,000)

Interest*

$134

Change in Market Value

$637,974,820

Market Value as of 28 February 2014

$1,163,394,586

Retirement Health Benefits Fund Initial Value as of 31 August 2010

$119,429,892

Contributions

$27,348,436

Withdrawals

($40,210,929)

Interest*

$448

Change in Market Value

$90,787,659

Market Value as of 28 February 2014

$197,355,506

Source: BlackRock As of 2/28/2015 Please note that the change in portfolio value detailed above is only relevant to the Russell 1000 Index Fund managed by BlackRock Institutional Trust, N.A. *Interest earned is from assets held in the Money Market Fund which is the sweep vehicle for the Russell 1000 Index Fund.

For use with institutional investors only — proprietary and confidential

50

VI. Fee Schedule

LADWP Fee Schedule

LADWP Management Fee Schedule

Total Assets

Annual Fee (bps)

First $500,000,000

1.0

Above $500,000,000

0.75

For use with institutional investors only — proprietary and confidential

53

Appendix – Presenter Biographies

Presenter Biographies Jeremy Watt, Director, is a member of the US and Canada Institutional team within BlackRock's Institutional Client Business. He is responsible for developing and maintaining relationships with institutional investors, including public and private pension plans, foundations and endowments. Mr. Watt's service with the firm dates back to 1996, including his years with Barclays Global Investors (BGI), which merged with BlackRock in 2009. At BGI, he was a senior client relationship officer for the US Institutional Client Service Group. Mr. Watt began his career at BGI as a senior data analyst before serving as a project manager for BGI's Global Market Data Group. Prior to joining BGI, Mr. Watt was a fund accountant and a securities operations analyst at Invesco.

Mr. Watt earned a BA degree in business studies from Charles Sturt University.

Corin Frost, CFA, Managing Director, is Global Head of Index Strategy in BlackRock's Beta Strategies Group. He is responsible for Index Equity product strategy and client relationships for all institutional equity products globally. Mr. Frost's service with the firm dates back to 1998, including his years with Barclays Global Investors (BGI), which merged with BlackRock in 2009. At BGI, he was the Global Head of Index Strategy within the Equity Index Portfolio Management Group. Before moving to the US, Mr. Frost headed the International Index Equity team in BGI's London office. Previously, Mr. Frost was an Index Portfolio Manager for Norwich Union Investment Management. Mr. Frost earned a BSc degree in economics from Cardiff University in 1991 and an MSc degree in economics from Warwick University in 1992.

For use with institutional investors only — proprietary and confidential

57

Important notes

This document contains general information only and is not intended to be relied upon as a forecast, research, investment advice, or a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The information does not take into account your financial circumstances. An assessment should be made as to whether the information is appropriate for you having regard to your objectives, financial situation and needs. The opinions expressed are as of 3/25/15 and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by BlackRock, Inc. and/or its subsidiaries (together, “BlackRock”) to be reliable, are not necessarily all inclusive and are not guaranteed as to accuracy. There is no guarantee that any forecasts made will come to pass. Any investments named within this material may not necessarily be held in any accounts managed by BlackRock. Reliance upon information in this material is at the sole discretion of the reader. Past performance is no guarantee of future results. BlackRock® is a registered trademark of BlackRock, Inc. All other trademarks are the property of their respective owners. In Latin America, for institutional investors and financial intermediaries only (not for public distribution). This material is for educational purposes only and does not constitute an offer or solicitation to sell or a solicitation of an offer to buy any shares of any fund or security and it is your responsibility to inform yourself of, and to observe, all applicable laws and regulations of your relevant jurisdiction. If any funds are mentioned or inferred in this material, such funds have not been registered with the securities regulators of Brazil, Chile, Colombia, Mexico, Panama, Peru, Uruguay or any other securities regulator in any Latin American country and thus, may not be publicly offered in any such countries, except for Chile where certain funds have been registered with the Superintendencia de Valores y Seguros for public offering and in Mexico where certain funds have been listed on the Sistema Internacional de Cotizaciones (SIC) exchange of the Bolsa Mexicana de Valores. The securities regulators of any country within Latin America have not confirmed the accuracy of any information contained herein. No information discussed herein can be provided to the general public in Latin America. The contents of this material are strictly confidential and must not be passed to any third party. © 2015 BlackRock, Inc. All rights reserved. BLACKROCK, BLACKROCK SOLUTIONS, and iSHARES are registered trademarks of BlackRock, Inc. or its subsidiaries. All other trademarks are the property of their respective owners.

For use with institutional investors only — proprietary and confidential

UIM-0101 58