# EDGAR Filing Document

**Accession Number:** 0001738078
**File Stem:** 0001193125-23-021595
**Filing Date:** 2023-2
**Character Count:** 51848
**Document Hash:** 5ea117350312d07575c5ce7513ef2779
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-021595.hdr.sgml**: 20230201

**ACCESSION NUMBER**: 0001193125-23-021595

**CONFORMED SUBMISSION TYPE**: 497K

**PUBLIC DOCUMENT COUNT**: 4

**FILED AS OF DATE**: 20230201

**DATE AS OF CHANGE**: 20230201

**EFFECTIVENESS DATE**: 20230201

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** BlackRock Funds V
- **CENTRAL INDEX KEY:** 0001738078
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** MA
- **FISCAL YEAR END:** 0930

**FILING VALUES:**
- **FORM TYPE:** 497K
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-224371
- **FILM NUMBER:** 23577094

**BUSINESS ADDRESS:**
- **STREET 1:** 100 BELLEVUE PARKWAY
- **CITY:** WILMINGTON
- **STATE:** DE
- **ZIP:** 19809
- **BUSINESS PHONE:** 800-441-7762

**MAIL ADDRESS:**
- **STREET 1:** 100 BELLEVUE PARKWAY
- **CITY:** WILMINGTON
- **STATE:** DE
- **ZIP:** 19809

## Series and Classes Contracts Data

### BlackRock Sustainable High Yield Bond Fund (Series ID: S000072568)

| Class ID   | Class Name    | Ticker Symbol   |
|:---|:---|:---|
| C000228901 | Investor A    |  |
| C000228902 | Institutional |  |

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| | |
|:---|:---|
| ![LOGO](g433187g56p99.jpg) | **JANUARY 27, 2023** |

---

## Summary Prospectus
**BlackRock Funds V \| Investor and Institutional Shares** 

• **BlackRock Sustainable High Yield Bond Fund** 

Investor A: BSHAX • Institutional: BSIHX

Before you invest, you may want to review the Fund's prospectus, which contains more information about the Fund and its risks. You can find the Fund's prospectus (including amendments and supplements), reports to shareholders and other information about the Fund, including the Fund's statement of additional information, online at http://www.blackrock.com/prospectus. You can also get this information at no cost by calling (800) 441-7762 or by sending an e-mail request to **prospectus.request@blackrock.com**, or from your financial professional. The Fund's [prospectus and statement of additional information,](http://www.sec.gov/Archives/edgar/data/../../../ix?doc=/Archives/edgar/data/1738078/000119312523020146/d425544d497.htm) both dated January 27, 2023, as amended and supplemented from time to time, are incorporated by reference into (legally made a part of) this Summary Prospectus.

*This Summary Prospectus contains information you should know before investing, including information about risks. Please read it before you invest and keep it for future reference.* 

*The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this Summary Prospectus. Any representation to the contrary is a criminal offense.* 

&nbsp;&nbsp;&nbsp;**Not FDIC Insured • May Lose Value • No Bank Guarantee**

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**Key Facts About BlackRock Sustainable High Yield Bond Fund** 

***Investment Objective***

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The investment objective of the BlackRock Sustainable High Yield Bond Fund (the "Fund") is to seek to maximize total return, consistent with income generation and prudent investment management, while seeking to maintain certain environmental, governance and social ("ESG") characteristics, climate risk exposure and climate opportunities relative to the Fund's benchmark.

***Fees and Expenses of the Fund***

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This table describes the fees and expenses that you may pay if you buy, hold and sell shares of the Fund. **You may pay other fees, such as brokerage commissions and other fees to your financial professional or your selected securities dealer, broker, investment adviser, service provider or industry professional (including BlackRock Advisors, LLC ("BlackRock") and its affiliates) (each a "Financial Intermediary"), which are not reflected in the table and example below.** You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $25,000 in the fund complex advised by BlackRock or its affiliates. More information about these and other discounts is available from your Financial Intermediary and in the "Details About the Share Classes" and the "Intermediary-Defined Sales Charge Waiver Policies" sections on pages 28 and A-1, respectively, of the Fund's prospectus and in the "Purchase of Shares" section on page II-88 of Part II of the Fund's Statement of Additional Information.

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| | | |
|:---|:---|:---|
| **Shareholder Fees**<br> **(fees paid directly from your investment)** | **Investor A<br>Shares** | **Institutional<br>Shares** |
| &nbsp;&nbsp; Maximum Sales Charge (Load) Imposed on Purchases (as percentage of offering price) | 4.00% |  |
| &nbsp;&nbsp; Maximum Deferred Sales Charge (Load) (as percentage of offering price or redemption proceeds, whichever is lower) | None<sup>1</sup> |  |
| **Annual Fund Operating Expenses**<br> **(expenses that you pay each year as a percentage of the value of your investment)** | **Investor A<br>Shares** | **Institutional<br>Shares** |
| &nbsp;&nbsp; Management Fee<sup>2</sup> | 0.50% | 0.50% |
| &nbsp;&nbsp; Distribution and/or Service (12b -1) Fees | 0.25% |  |
| &nbsp;&nbsp; Other Expenses<sup>3</sup> | 0.97% | 0.97% |
| &nbsp;&nbsp; Total Annual Fund Operating Expenses<sup>4</sup> | 1.72% | 1.47% |
| &nbsp;&nbsp; Fee Waivers and/or Expense Reimbursements<sup>2,</sup><sup>5</sup> | (0.89)% | (0.89)% |
| &nbsp;&nbsp; Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements<sup>2,</sup><sup>5</sup> | 0.83% | 0.58% |

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<sup>1</sup> A contingent deferred sales charge ("CDSC") of 0.75% is assessed on certain redemptions of Investor A Shares made within 18 months after purchase where no initial sales charge was paid at the time of purchase as part of an investment of $1,000,000 or more. 

<sup>2</sup> As described in the "Management of the Fund" section of the Fund's prospectus beginning on page 42, BlackRock has contractually agreed to waive the management fee with respect to any portion of the Fund's assets estimated to be attributable to investments in other equity and fixed-income mutual funds and exchange-traded funds managed by BlackRock or its affiliates that have a contractual management fee, through June 30, 2024. In addition, BlackRock has contractually agreed to waive its management fees by the amount of investment advisory fees the Fund pays to BlackRock indirectly through its investment in money market funds managed by BlackRock or its affiliates, through June 30, 2024. The contractual agreements may be terminated upon 90 days' notice by a majority of the non-interested trustees of BlackRock Funds V (the "Trust") or by a vote of a majority of the outstanding voting securities of the Fund. 

<sup>3</sup> Other Expenses have been restated to reflect current fees.

<sup>4</sup> The Total Annual Fund Operating Expenses do not correlate to the ratios of expenses to average net assets given in the Fund's most recent annual report, which do not include the restatement of Other Expenses to reflect current fees. 

<sup>5</sup> As described in the "Management of the Fund" section of the Fund's prospectus beginning on page 42, BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses) to 0.83% (for Investor A Shares) and 0.58% (for Institutional Shares) of average daily net assets through June 30, 2024. The Fund may have to repay some of these waivers and/or reimbursements to BlackRock in the two years following such waivers and/or reimbursements. Any such repayment obligation will terminate on July 22, 2028. The contractual 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. 

**2** 

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**Example:** 

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **1 Year** | **3 Years** | **5 Year** | **10 Year** |
| &nbsp;&nbsp; Investor A Shares | $481 | $837 | $1216 | $2278 |
| &nbsp;&nbsp; Institutional Shares | $59 | $377 | $718 | $1681 |

---

**Portfolio Turnover:** 

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the fiscal period from July 22, 2021 through September 30, 2022, the Fund's portfolio turnover rate was 47% (not annualized) of the average value of its portfolio.

***Principal Investment Strategies of the Fund***

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The Fund invests primarily in non-investment grade bonds with maturities of ten years or less. The Fund normally invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in high yield bonds.

The high yield securities (commonly called "junk bonds") acquired by the Fund will generally be in the lower rating categories of the major rating agencies (BB or lower by S&P Global Ratings or Fitch Ratings, Inc. or Ba or lower by Moody's Investor Services) or will be determined by the Fund management team to be of similar quality. Split rated bonds and other fixed-income securities (securities that receive different ratings from two or more rating agencies) are considered to have the median credit rating if three agencies rate the security and the lower credit rating if two agencies rate the security. High yield securities generally pay more interest than higher rated securities. The higher yield is an incentive to investors who otherwise may be hesitant to purchase the debt of a low-rated issuer. The Fund may invest in securities of any rating, and may invest up to 10% of its assets (measured at the time of investment) in distressed securities that are in default or the issuers of which are in bankruptcy.

To determine the Fund's investable universe, Fund management will first seek to screen out certain issuers based on ESG criteria determined by BlackRock, subject to the considerations noted below. Such screening criteria principally includes: (i) issuers that derive more than zero percent of revenue from the production of controversial weapons;

(ii) issuers that derive more than zero percent of revenue from the production of civilian firearms; (iii) issuers that derive more than zero percent of revenue from the production of tobacco-related products; (iv) issuers that derive more than five percent of revenue from thermal coal generation, unless such issuers either (a) have made certain commitments to reduce climate impact or (b) derive at least fifty percent of revenue from alternative energy sources; (v) issuers that derive more than five percent of revenue from thermal coal mining; (vi) issuers that derive more than five percent of revenue from oil sands extraction, unless the issuers have set certain targets to reduce climate impact; (vii) issuers identified as violators of the United Nations Global Compact, which are globally accepted principles covering corporate behavior in the areas of human rights, labor, environment, and anti-corruption; and (viii) issuers receiving an ESG rating of CCC (or equivalent) by recognized third-party rating agencies. Notwithstanding the foregoing, the Fund may invest in green bonds of issuers that exceed the thresholds stated in (iv), (v), and (vi) above. The Fund relies on one or more third-party ratings agencies to identify issuers for purposes of the above screening criteria. Third-party rating agencies may base the above screening criteria on an estimate when revenue for a covered business activity is not disclosed by the issuer or publicly available.

The Fund's screening criteria is measured at the time of investment and is dependent upon information and data that may be incomplete, inaccurate, unavailable or estimated. Where the Fund's screening criteria looks solely to third-party ratings or data, issuers are only screened to the extent such ratings or data have been assigned or made available by the third parties. This screening criteria is subject to change over time at BlackRock's discretion.

BlackRock utilizes a proprietary sustainability scoring system, fundamental sector research and third-party ESG data in constructing the Fund's portfolio. Fund management identifies top-down investment themes and determines sector, industry and security weights. The management team evaluates sectors of the high yield market and individual bonds within these sectors. Securities are purchased for the Fund when Fund management determines that they have the potential for above-average total return. If a security's credit rating declines, the management team will decide whether to continue to hold the security. A security will be sold if, in the opinion of Fund management, the risk of continuing to hold the security is unacceptable when compared to its total return potential.

Fund management also selects and weights securities based on an issuer's ability to manage the ESG risks to which its business is exposed, as determined by BlackRock. Fund management makes such determinations based on

**3** 

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BlackRock's ESG research, which includes due diligence of the ESG risks and opportunities facing an issuer, as well as third-party ESG ratings. BlackRock researches and develops investment insights related to economic transition, which include target carbon transition readiness and climate opportunities.

The Fund seeks to maintain certain ESG characteristics, climate risk exposure and climate opportunities relative to the Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index (the "Benchmark"). Specifically, with respect to the Fund's investments in high yield bonds, the Fund generally seeks to invest in a portfolio that, in BlackRock's view, (i) has an aggregate ESG assessment that is better than that of the Benchmark, (ii) has an aggregate carbon emissions assessment that is lower than that of the Benchmark, and (iii) in the aggregate, includes issuers that BlackRock believes are better positioned to capture climate opportunities relative to the issuers in the Benchmark. The Fund may invest in other sectors that are not included in such assessments.

While Fund management considers ESG characteristics as well as climate risk exposure and climate opportunities, only one or two of these categories may be considered with respect to a particular investment or sector, and categories may be weighted differently according to the type of investment being considered. In addition, the Fund may gain indirect exposure (through, including but not limited to, derivatives and investments in other investment companies) to issuers with exposures that are inconsistent with the ESG-related criteria used by Fund management.

The Fund may invest up to 30% of its assets in foreign issuers, including securities and currencies in both developed and emerging markets and non-dollar denominated bonds of issuers located outside of the United States. The Fund's investment in non-dollar denominated bonds may be on a currency hedged or unhedged basis.

The Fund may also invest in convertible and preferred securities. Convertible debt securities will be counted toward the Fund's 80% policy to the extent they have ratings or equivalent quality characteristics similar to the securities included within that policy as described above. Convertible securities generally are debt securities or preferred stock that may be converted into common stock. Convertible securities typically pay current income as either interest (debt security convertibles) or dividends (preferred stock convertibles). A convertible security's value usually reflects both the stream of current income payments and the market value of the underlying stock. Preferred securities are a class of stock that often pays dividends at a specified rate and has preference over common stock in dividend payments and liquidation of assets.

To add diversification, the management team can invest in a wide range of securities including investment grade corporate bonds, mezzanine investments, collateralized bond obligations, bank loans and mortgage-backed and asset-backed securities. Mezzanine investments are subordinated debt securities that receive payments of interest and principal after other more senior security holders are paid. They are generally issued in private placements in connection with an equity security. Collateralized bond obligations are securities backed by a diversified pool of high yield securities. Bank loans are fixed and floating rate loans arranged through private negotiations between a company or a non-U.S. government and one or more financial institutions. The Fund considers such investments to be debt securities.

There is a wide variety of mortgage-backed securities involving commercial or residential, fixed rate or adjustable rate mortgages and mortgages issued by banks or government agencies. Asset-backed securities are bonds that are backed by a pool of assets, usually loans such as installment sale contracts or credit card receivables.

The Fund may buy or sell options or futures on a security or an index of securities, or enter into credit default swaps and interest rate or foreign currency transactions, including swaps (collectively, commonly known as derivatives). The Fund may use derivative instruments to hedge its investments or to seek to enhance returns. The Fund may seek to obtain market exposure to the securities in which it primarily invests by entering into a series of purchase and sale contracts or by using other investment techniques (such as reverse repurchase agreements or dollar rolls).

The Fund may engage in active and frequent trading of portfolio securities to achieve its principal investment strategies.

***Principal Risks of Investing in the Fund***

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Risk is inherent in all investing. The value of your investment in the Fund, as well as the amount of return you receive on your investment, may fluctuate significantly from day to day and over time. You may lose part or all of your investment in the Fund or your investment may not perform as well as other similar investments. The following is a summary description of principal risks of investing in the Fund. The relative significance of each risk factor below may change over time and you should review each risk factor carefully.

∎  ***Junk Bonds Risk*** — Although junk bonds generally pay higher rates of interest than investment grade
bonds, junk bonds are high risk investments that are considered speculative and may cause income and principal losses for the Fund.

∎  ***ESG Investing Risk*** — The Fund intends to screen out particular issuers pursuant to certain criteria
established by BlackRock, and to measure ESG characteristics, including characteristics related to climate, with respect to certain investments pursuant to a methodology determined by BlackRock. This may affect the Fund's exposure to certain

**4** 

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issuers and the Fund may forego certain investment opportunities. The Fund's results may be lower than other funds that do not seek to invest in issuers based on ESG criteria, or that use a different methodology to screen out issuers or evaluate ESG criteria. The Fund seeks to identify issuers that it believes are better positioned to manage ESG risks and opportunities related to their businesses and to avoid certain companies and industries with ESG related risks, but investors may differ in their views of what constitutes positive or negative ESG criteria. As a result, the Fund may invest in issuers that do not reflect the beliefs and values of any particular investor. In evaluating a security or issuer based on ESG criteria, BlackRock is dependent upon certain information and data from third party providers of ESG research, which may be incomplete, inaccurate or unavailable. As a result, there is a risk that BlackRock may incorrectly assess a security or issuer. There is also a risk that BlackRock may not apply the relevant ESG criteria correctly or that the Fund could have indirect exposure to issuers who do not meet the relevant ESG criteria used by the Fund. Neither the Fund nor BlackRock make any representation or warranty, express or implied, with respect to the fairness, correctness, accuracy, reasonableness or completeness of such ESG assessment. There may be limitations with respect to availability of ESG data in certain sectors, as well as limited availability of investments with positive ESG assessments in certain sectors. BlackRock's evaluation of ESG criteria is subjective and may change over time. <br>

The Fund may not include all instruments in its ESG-related assessments, and may place weight on other factors when selecting investments. In addition, the Fund may not be successful in its objectives related to ESG characteristics, climate risk and climate opportunities. There is no guarantee that these objectives will be achieved, and such assessments are at BlackRock's discretion.

∎  ***Debt Securities Risk*** — Debt securities, such as bonds, involve interest rate risk, credit risk,
extension risk, and prepayment risk, among other things.

*Interest Rate Risk* — The market value of bonds and other fixed-income securities changes in response to interest rate changes and other factors. Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates fall and decrease as interest rates rise.

The Fund may be subject to a greater risk of rising interest rates due to the recent period of historically low interest rates. For example, if interest rates increase by 1%, assuming a current portfolio duration of ten years, and all other factors being equal, the value of the Fund's investments would be expected to decrease by 10%. (Duration is a measure of the price sensitivity of a debt security or portfolio of debt securities to relative changes in interest rates.) The magnitude of these fluctuations in the market price of bonds and other fixed-income securities is generally greater for those securities with longer maturities. Fluctuations in the market price of the Fund's investments will not affect interest income derived from instruments already owned by the Fund, but will be reflected in the Fund's net asset value. The Fund may lose money if short-term or long-term interest rates rise sharply in a manner not anticipated by Fund management.

To the extent the Fund invests in debt securities that may be prepaid at the option of the obligor (such as mortgage-backed securities), the sensitivity of such securities to changes in interest rates may increase (to the detriment of the Fund) when interest rates rise. Moreover, because rates on certain floating rate debt securities typically reset only periodically, changes in prevailing interest rates (and particularly sudden and significant changes) can be expected to cause some fluctuations in the net asset value of the Fund to the extent that it invests in floating rate debt securities.

These basic principles of bond prices also apply to U.S. Government securities. A security backed by the "full faith and credit" of the U.S. Government is guaranteed only as to its stated interest rate and face value at maturity, not its current market price. Just like other fixed-income securities, government-guaranteed securities will fluctuate in value when interest rates change.

A general rise in interest rates has the potential to cause investors to move out of fixed-income securities on a large scale, which may increase redemptions from funds that hold large amounts of fixed-income securities. Heavy redemptions could cause the Fund to sell assets at inopportune times or at a loss or depressed value and could hurt the Fund's performance.

*Credit Risk* — Credit risk refers to the possibility that the issuer of a debt security (i.e., the borrower) will not be able to make payments of interest and principal when due. Changes in an issuer's credit rating or the market's perception of an issuer's creditworthiness may also affect the value of the Fund's investment in that issuer. The degree of credit risk depends on both the financial condition of the issuer and the terms of the obligation.

*Extension Risk* — When interest rates rise, certain obligations will be paid off by the obligor more slowly than anticipated, causing the value of these obligations to fall.

*Prepayment Risk* — When interest rates fall, certain obligations will be paid off by the obligor more quickly than originally anticipated, and the Fund may have to invest the proceeds in securities with lower yields.

∎  ***Bank Loan Risk*** — The market for bank loans may lack liquidity and the Fund may have difficulty selling
them. These investments expose the Fund to the credit risk of both the financial institution and the underlying borrower.

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∎  ***Collateralized Bond Obligations Risk*** *—* The pool of high yield securities underlying
collateralized bond obligations is typically separated into groupings called tranches representing different degrees of credit quality. The higher quality tranches have greater degrees of protection and pay lower interest rates. The lower tranches,
with greater risk, pay higher interest rates.

∎  ***Convertible Securities Risk*** — The market value of a convertible security performs like that of a
regular debt security; that is, if market interest rates rise, the value of a convertible security usually falls. In addition, convertible securities are subject to the risk that the issuer will not be able to pay interest or dividends when due, and
their market value may change based on changes in the issuer's credit rating or the market's perception of the issuer's creditworthiness. Since it derives a portion of its value from the common stock into which it may be converted, a
convertible security is also subject to the same types of market and issuer risks that apply to the underlying common stock.

∎  ***Derivatives Risk*** — The Fund's use of derivatives may increase its costs, reduce the Fund's
returns and/or increase volatility. Derivatives involve significant risks, including:

*Leverage Risk* — The Fund's use of derivatives can magnify the Fund's gains and losses. Relatively small market movements may result in large changes in the value of a derivatives position and can result in losses that greatly exceed the amount originally invested.

*Market Risk* — Some derivatives are more sensitive to interest rate changes and market price fluctuations than other securities. The Fund could also suffer losses related to its derivatives positions as a result of unanticipated market movements, which losses are potentially unlimited. Finally, BlackRock may not be able to predict correctly the direction of securities prices, interest rates and other economic factors, which could cause the Fund's derivatives positions to lose value.

*Counterparty Risk* — Derivatives are also subject to counterparty risk, which is the risk that the other party in the transaction will be unable or unwilling to fulfill its contractual obligation, and the related risks of having concentrated exposure to such a counterparty.

*Illiquidity Risk* — The possible lack of a liquid secondary market for derivatives and the resulting inability of the Fund to sell or otherwise close a derivatives position could expose the Fund to losses and could make derivatives more difficult for the Fund to value accurately.

*Operational Risk* — The use of derivatives includes the risk of potential operational issues, including documentation issues, settlement issues, systems failures, inadequate controls and human error.

*Legal Risk* — The risk of insufficient documentation, insufficient capacity or authority of counterparty, or legality or enforceability of a contract.

*Volatility and Correlation Risk* — Volatility is defined as the characteristic of a security, an index or a market to fluctuate significantly in price within a short time period. A risk of the Fund's use of derivatives is that the fluctuations in their values may not correlate with the overall securities markets.

*Valuation Risk* — Valuation for derivatives may not be readily available in the market. Valuation may be more difficult in times of market turmoil since many investors and market makers may be reluctant to purchase complex instruments or quote prices for them.

*Hedging Risk* — Hedges are sometimes subject to imperfect matching between the derivative and the underlying security, and there can be no assurance that the Fund's hedging transactions will be effective. The use of hedging may result in certain adverse tax consequences.

*Tax Risk* — Certain aspects of the tax treatment of derivative instruments, including swap agreements and commodity-linked derivative instruments, are currently unclear and may be affected by changes in legislation, regulations or other legally binding authority. Such treatment may be less favorable than that given to a direct investment in an underlying asset and may adversely affect the timing, character and amount of income the Fund realizes from its investments.

*Regulatory Risk* — Derivative contracts are subject to regulation under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") in the United States and under comparable regimes in Europe, Asia and other non-U.S. jurisdictions. Under the Dodd-Frank Act, with respect to uncleared swaps, swap dealers are required to collect variation margin from the Fund and may be required by applicable regulations to collect initial margin from the Fund. Both initial and variation margin may be comprised of cash and/or securities, subject to applicable regulatory haircuts. Shares of investment companies (other than certain money market funds) may not be posted as collateral under applicable regulations. In addition, regulations adopted by global prudential regulators that are now in effect require certain bank-regulated counterparties and certain of their affiliates to include in certain financial contracts, including many derivatives contracts, terms that delay or restrict the rights of counterparties, such as the Fund, to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain types of

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resolution or insolvency proceedings. The implementation of these requirements with respect to derivatives, as well as regulations under the Dodd-Frank Act regarding clearing, mandatory trading and margining of other derivatives, may increase the costs and risks to the Fund of trading in these instruments and, as a result, may affect returns to investors in the Fund.

∎  ***Distressed Securities Risk — Distressed securities are speculative and involve substantial risks in addition to the risks of investing in junk bonds. The Fund will generally not receive interest payments on the distressed securities and may incur costs to protect its investment. In addition, distressed securities involve the substantial risk that principal will not be repaid. These securities may present a substantial risk of default or may be in default at the time of investment. The Fund may incur additional expenses to the extent it is required to seek recovery upon a default in the payment of principal of or interest on its portfolio holdings. In any reorganization or liquidation proceeding relating to a portfolio company, the Fund may lose its entire investment or may be required to accept cash or securities with a value less than its original investment. Distressed securities and any securities received in an exchange for such securities may be subject to restrictions on resale.*** 

∎  ***Dollar Rolls Risk*** — Dollar rolls involve the risk that the market value of the securities that the Fund
is committed to buy may decline below the price of the securities the Fund has sold. These transactions may involve leverage.

∎  ***Emerging Markets Risk*** — Emerging markets are riskier than more developed markets because they tend to
develop unevenly and may never fully develop. Investments in emerging markets may be considered speculative. Emerging markets are more likely to experience hyperinflation and currency devaluations, which adversely affect returns to U.S. investors.
In addition, many emerging securities markets have far lower trading volumes and less liquidity than developed markets.

∎  ***Foreign Securities Risk*** — Foreign investments often involve special risks not present in U.S.
investments that can increase the chances that the Fund will lose money. These risks include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ The Fund generally holds its foreign securities and cash in foreign banks and securities depositories, which may be
recently organized or new to the foreign custody business and may be subject to only limited or no regulatory oversight.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ Changes in foreign currency exchange rates can affect the value of the Fund's portfolio.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ The economies of certain foreign markets may not compare favorably with the economy of the United States with respect to
such issues as growth of gross national product, reinvestment of capital, resources and balance of payments position.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ The governments of certain countries, or the U.S. Government with respect to certain countries, may prohibit or impose
substantial restrictions through capital controls and/or sanctions on foreign investments in the capital markets or certain industries in those countries, which may prohibit or restrict the ability to own or transfer currency, securities,
derivatives or other assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ Many foreign governments do not supervise and regulate stock exchanges, brokers and the sale of securities to the same
extent as does the United States and may not have laws to protect investors that are comparable to U.S. securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ Settlement and clearance procedures in certain foreign markets may result in delays in payment for or delivery of
securities not typically associated with settlement and clearance of U.S. investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ The Fund's claims to recover foreign withholding taxes may not be successful, and if the likelihood of recovery of
foreign withholding taxes materially decreases, due to, for example, a change in tax regulation or approach in the foreign country, accruals in the Fund's net asset value for such refunds may be written down partially or in full, which will
adversely affect the Fund's net asset value.

∎  ***High Portfolio Turnover Risk*** — The Fund may engage in active and frequent trading of its portfolio
securities. High portfolio turnover (more than 100%) may result in increased transaction costs to the Fund, including brokerage commissions, dealer mark-ups and other transaction costs on the sale of the securities and on reinvestment in other
securities. The sale of Fund portfolio securities may result in the realization and/or distribution to shareholders of higher capital gains or losses as compared to a fund with less active trading policies. These effects of higher than normal
portfolio turnover may adversely affect Fund performance.

∎  ***Illiquid Investments Risk*** — The Fund may not acquire any illiquid investment if, immediately after the
acquisition, the Fund would have invested more than 15% of its net assets in illiquid investments. An illiquid investment is any investment that the Fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar
days or less without the sale or disposition significantly changing the market value of the investment. Liquid investments may become illiquid after purchase by the Fund, particularly during periods of market turmoil. There can be no assurance that
a security or instrument that is deemed to be liquid when purchased will continue to be liquid for as long as it is held by the Fund, and any security or instrument held by the Fund may be deemed an illiquid investment pursuant to the Fund's
liquidity risk management program. The Fund's illiquid investments may

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reduce the returns of the Fund because it may be difficult to sell the illiquid investments at an advantageous time or price. In addition, if the Fund is limited in its ability to sell illiquid investments during periods when shareholders are redeeming their shares, the Fund will need to sell liquid securities to meet redemption requests and illiquid securities will become a larger portion of the Fund's holdings. An investment may be illiquid due to, among other things, the lack of an active trading market. To the extent that the Fund's principal investment strategies involve derivatives or securities with substantial market and/or credit risk, the Fund will tend to have the greatest exposure to the risks associated with illiquid investments. Illiquid investments may be harder to value, especially in changing markets, and if the Fund is forced to sell these investments to meet redemption requests or for other cash needs, the Fund may suffer a loss. In addition, when there is illiquidity in the market for certain securities, the Fund, due to limitations on illiquid investments, may be subject to purchase and sale restrictions. <br>

∎  ***Leverage Risk*** — Some transactions may give rise to a form of economic leverage. These transactions may
include, among others, derivatives, and may expose the Fund to greater risk and increase its costs. The use of leverage may cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to
meet the applicable requirements of the Investment Company Act of 1940, as amended (the "Investment Company Act"), and the rules thereunder. Increases and decreases in the value of the Fund's portfolio will be magnified when the Fund
uses leverage.

∎  ***Market Risk and Selection Risk*** — Market risk is the risk that one or more markets in which the Fund
invests will go down in value, including the possibility that the markets will go down sharply and unpredictably. The value of a security or other asset may decline due to changes in general market conditions, economic trends or events that are not
specifically related to the issuer of the security or other asset, or factors that affect a particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of industries, sector or asset class. Local, regional or
global events such as war, acts of terrorism, the spread of infectious illness or other public health issues like pandemics or epidemics, recessions, or other events could have a significant impact on the Fund and its investments. Selection risk is
the risk that the securities selected by Fund management will underperform the markets, the relevant indices or the securities selected by other funds with similar investment objectives and investment strategies. This means you may lose money.

An outbreak of an infectious coronavirus (COVID-19) that was first detected in December 2019 developed into a global pandemic that has resulted in numerous disruptions in the market and has had significant economic impact leaving general concern and uncertainty. Although vaccines have been developed and approved for use by various governments, the duration of the pandemic and its effects cannot be predicted with certainty. The impact of this coronavirus, and other epidemics and pandemics that may arise in the future, could affect the economies of many nations, individual companies and the market in general ways that cannot necessarily be foreseen at the present time.

∎  ***Mezzanine Securities Risk*** — Mezzanine securities carry the risk that the issuer will not be
able to meet its obligations and that the equity securities purchased with the mezzanine investments may lose value.

∎  ***Mortgage- and Asset-Backed Securities Risks*** — Mortgage- and asset-backed securities represent interests
in "pools" of mortgages or other assets, including consumer loans or receivables held in trust. Mortgage- and asset-backed securities are subject to credit, interest rate, prepayment and extension risks. These securities also are subject
to risk of default on the underlying mortgage or asset, particularly during periods of economic downturn. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain mortgage-backed
securities.

∎  ***Preferred Securities Risk*** — Preferred securities may pay fixed or adjustable rates of return.
Preferred securities are subject to issuer-specific and market risks applicable generally to equity securities. In addition, a company's preferred securities generally pay dividends only after the company makes required payments to holders of
its bonds and other debt. For this reason, the value of preferred securities will usually react more strongly than bonds and other debt to actual or perceived changes in the company's financial condition or prospects. Preferred securities of
smaller companies may be more vulnerable to adverse developments than preferred securities of larger companies.

∎  ***Repurchase Agreements and Purchase and Sale Contracts Risk*** — If the other party to a repurchase
agreement or purchase and sale contract defaults on its obligation under the agreement, the Fund may suffer delays and incur costs or lose money in exercising its rights under the agreement. If the seller fails to repurchase the security in either
situation and the market value of the security declines, the Fund may lose money.

∎  ***Reverse Repurchase Agreements Risk*** — Reverse repurchase agreements involve the sale of securities held
by the Fund with an agreement to repurchase the securities at an agreed-upon price, date and interest payment. Reverse repurchase agreements involve the risk that the other party may fail to return the securities in a timely manner or at all. The
Fund could lose money if it is unable to recover the securities and the value of the collateral held by the Fund, including the value of the investments made with cash collateral, is less than the value of the securities. These events could also
trigger adverse tax consequences for the Fund. In addition, reverse repurchase agreements involve the risk that the interest income earned in the investment of the proceeds will be less than the interest expense.

∎  ***Risk of Investing in the United States*** — Certain changes in the U.S. economy, such as when the U.S.
economy weakens or when its financial markets decline, may have an adverse effect on the securities to which the Fund has exposure.

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***Performance Information***

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The information shows you how the Fund's performance has varied year by year and provides some indication of the risks of investing in the Fund. The table compares the Fund's performance to that of the Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index**.** To the extent that dividends and distributions have been paid by the Fund, the performance information for the Fund in the chart and table assumes reinvestment of the dividends and distributions. As with all such investments, past performance (before and after taxes) is not an indication of future results. Sales charges are not reflected in the bar chart. If they were, returns would be less than those shown. However, the table includes all applicable fees and sales charges. If the Fund's investment manager and its affiliates had not waived or reimbursed certain Fund expenses during these periods, the Fund's returns would have been lower. Updated information on the Fund's performance, including its current net asset value, can be obtained by visiting http://www.blackrock.com or can be obtained by phone at 800-882-0052.

**Investor A Shares** 

**ANNUAL TOTAL RETURNS** 

**BlackRock Sustainable High Yield Bond Fund** 

**As of 12/31**![LOGO](g433187g01g01.jpg)

During the period shown in the bar chart, the highest return for a quarter was 3.98% (quarter ended December 31, 2022) and the lowest return for a quarter was –9.73% (quarter ended June 30, 2022).

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| | | |
|:---|:---|:---|
| **For the periods ended 12/31/22**<br> **Average Annual Total Returns** | **1 Year** | **Since<br>Inception<br>(July 22, 2021)** |
| &nbsp;&nbsp; BlackRock Sustainable High Yield Bond Fund — Investor A Shares |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Return Before Taxes | (15.08)% | (10.18)% |
| &nbsp;&nbsp;&nbsp;&nbsp; Return After Taxes on Distributions | (16.66)% | (11.72)% |
| &nbsp;&nbsp;&nbsp;&nbsp; Return After Taxes on Distributions and Sale of Fund Shares | (8.91)% | (8.31)% |
| &nbsp;&nbsp; BlackRock Sustainable High Yield Bond Fund — Institutional Shares |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Return Before Taxes | (11.32)% | (7.37)% |
| &nbsp;&nbsp; Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index (Reflects no deduction for fees, expenses or taxes) | (11.18)% | (7.06)% |

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After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor's tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts. After-tax returns are shown for Investor A Shares only, and the after-tax returns for Institutional Shares will vary.

***Investment Manager***

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The Fund's investment manager is BlackRock Advisors, LLC (previously defined as "BlackRock"). The Fund's sub-adviser is BlackRock International Limited. Where applicable, the use of the term BlackRock also refers to the Fund's sub-adviser.

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***Portfolio Managers***

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; **Name** | **Portfolio Manager of the Fund Since** | **Title** |
| &nbsp;&nbsp; David Delbos | 2021 | Managing Director of BlackRock, Inc. |
| &nbsp;&nbsp; Mitchell Garfin | 2021 | Managing Director of BlackRock, Inc. |
| &nbsp;&nbsp; Ashley Schulten | 2021 | Managing Director of BlackRock, Inc. |

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***Purchase and Sale of Fund Shares***

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You may purchase or redeem shares of the Fund each day the New York Stock Exchange is open. To purchase or sell shares you should contact your Financial Intermediary, or, if you hold your shares through the Fund, you should contact the Fund by phone at (800) 441-7762, by mail (c/o BlackRock Funds, P.O. Box 9819, Providence, Rhode Island 02940-8019), or by the Internet at www.blackrock.com. The Fund's initial and subsequent investment minimums generally are as follows, although the Fund may reduce or waive the minimums in some cases:

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| | | |
|:---|:---|:---|
| | **Investor A Shares** | **Institutional Shares** |
| **Minimum Initial Investment** | $1,000 for all accounts except:<br> • $50, if establishing an Automatic Investment Plan.<br> • There is no investment minimum for employer-sponsored retirement plans (not including SEP IRAs, SIMPLE IRAs or SARSEPs).<br> • There is no investment minimum for certain fee-based programs. | There is no minimum initial investment for:<br> • Employer-sponsored retirement plans (not including SEP IRAs, SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which may purchase shares of the Fund through a Financial Intermediary that has entered into an agreement with the Fund's distributor to purchase such shares.<br> • Clients of Financial Intermediaries that: (i) charge such clients a fee for advisory, investment consulting, or similar services or (ii) have entered into an agreement with the Fund's distributor to offer Institutional Shares through a no-load program or investment platform.<br> • Clients investing through a self-directed IRA brokerage account program sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that the program maintains an account with the Fund on an omnibus basis. $2 million for individuals and "Institutional Investors," which include, but are not limited to, endowments, foundations, family offices, local, city, and state governmental institutions, corporations and insurance company separate accounts who may purchase shares of the Fund through a Financial Intermediary that has entered into an agreement with the Fund's distributor to purchase such shares. $1,000 for:<br> • Clients investing through Financial Intermediaries that offer such shares on a platform that charges a transaction based sales commission outside of the Fund.<br> • Tax-qualified accounts for insurance agents that are registered representatives of an insurance company's broker-dealer that has entered into an agreement with the Fund's distributor to offer Institutional Shares, and the family members of such persons. |
| **Minimum Additional Investment** | $50 for all accounts (with the exception of certain employer-sponsored retirement plans which may have a lower minimum). | No subsequent minimum. |

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***Tax Information***

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The Fund's dividends and distributions may be subject to U.S. federal income taxes and may be taxed as ordinary income or capital gains, unless you are a tax-exempt investor or are investing through a qualified tax-exempt plan described in section 401(a) of the Internal Revenue Code, in which case you may be subject to U.S. federal income tax when distributions are received from such tax-deferred arrangements.

***Payments to Broker/Dealers and Other Financial Intermediaries***

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If you purchase shares of the Fund through a Financial Intermediary, the Fund and BlackRock Investments, LLC, the Fund's distributor, or its affiliates may pay the Financial Intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the Financial Intermediary and your individual financial professional to recommend the Fund over another investment.

Ask your individual financial professional or visit your Financial Intermediary's website for more information.

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INVESTMENT COMPANY ACT FILE # 811-23339

SPRO-SHYB-0123

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| ![LOGO](g433187g56p99.jpg) | ![LOGO](g433187g41v31.jpg) |

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