SEPTEMBER 30, 2020 2020 Annual Report BlackRock Balanced Capital Fund, Inc. Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from BlackRock or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report. You may elect to receive all future reports in paper free of charge. If you hold accounts directly with BlackRock, you can call (800) 441- 7762 to inform BlackRock that you wish to continue receiving paper copies of your shareholder reports. 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You may elect to receive electronic delivery of shareholder reports and other communications by: (i) accessing the BlackRock website at blackrock.com/edelivery and logging into your accounts, if you hold accounts directly with BlackRock, or (ii) contacting your financial intermediary, if you hold accounts through a financial intermediary. Please note that not all financial intermediaries may offer this service. Not FDIC Insured • May Lose Value • No Bank Guarantee The Markets in Review Dear Shareholder, The last 12 months have been a time of sudden change in global financial markets, as a long period of growth and positive returns was interrupted in early 2020 by the emergence and spread of the coronavirus. For the first part of the reporting period, U.S. equities and bonds both delivered impressive returns, despite fears and doubts about the economy that were ultimately laid to rest with unprecedented monetary stimulus and a sluggish yet resolute performance from the U.S. economy. But as the threat from the coronavirus became more apparent throughout February and March 2020, leading countries around the world took economically disruptive countermeasures, causing equity prices to fall sharply. While markets have since recovered some of these losses as countries around the world begin reopening, there is still significant uncertainty surrounding the long-term impact of the pandemic on the global economy. Rob Kapito President, BlackRock Advisors, LLC Returns for most securities were robust for the first part of the reporting period, as investors began to realize that the U.S. economy was maintaining the modest yet steady growth that had characterized this economic cycle. However, once stay-at-home orders and closures of non-essential businesses became widespread, many workers were laid off and unemployment claims spiked. With large portions of the global economy on Total Returns as of September 30, 2020 hold, all types of international equities ended the 12-month reporting period with negative performance, while 6-Month 12-Month in the United States large-capitalization stocks, which investors saw as more resilient than smaller companies, U.S. large cap equities 31.31% 15.15% delivered solid returns. (S&P 500ா Index) U.S. small cap equities The performance of different types of fixed-income securities diverged substantially due to a reduced investor ா 31.60 0.39 (Russell 2000 Index) appetite for risk. Treasuries benefited from the risk-off environment, and posted healthy returns, as the 10-year U.S. Treasury yield (which is inversely related to bond prices) fell to an all-time low. Investment-grade International equities corporate bonds also delivered a solid return, while high-yield corporate returns were muted due to credit (MSCI Europe, Australasia, 20.39 0.49 Far East Index) concerns. Emerging market The U.S. Federal Reserve (the “Fed”) reduced interest rates three times in 2019, to support slowing economic equities (MSCI Emerging 29.37 10.54 growth. After the coronavirus outbreak, the Fed instituted two emergency rate cuts, pushing short-term interest Markets Index) rates close to zero. To stabilize credit markets, the Fed also announced a new bond-buying program, as did 3-month Treasury bills several other central banks around the world, including the European Central Bank and the Bank of Japan. (ICE BofA 3-Month U.S. 0.06 1.10 Treasury Bill Index) Looking ahead, while coronavirus-related disruption is certain to hurt worldwide economic growth, the global U.S. Treasury securities expansion is likely to continue once the impact of the outbreak subsides. We are encouraged by the strong (ICE BofA 10-Year U.S. 0.71 10.74 coordinated monetary and fiscal response that is underway, both in the United States and abroad. However, Treasury Index) there remains a risk that policy fatigue and recent improvements in economic indicators could lead lawmakers U.S. investment grade to retreat from needed stimulus measures too soon. bonds (Bloomberg Barclays 3.53 6.98 U.S. Aggregate Bond Index) Overall, we favor a neutral stance toward risk, given the uncertainty surrounding the path to recovery. Among Tax-exempt municipal equities, we see an advantage in U.S. stocks compared to other developed markets, given the diversity of the bonds (S&P Municipal 3.78 3.85 U.S. economy and the impressive scope of monetary and fiscal stimulus. In bonds, the swift action taken by the Bond Index) world’s central banks means there are attractive opportunities in credit, and we expect credit spreads to narrow U.S. high yield bonds as markets stabilize. Both U.S. Treasuries and sustainable investments can help provide portfolio resilience, (Bloomberg Barclays U.S. 15.18 3.20 and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable Corporate High Yield 2% investments. Issuer Capped Index) In this environment, our view is that investors need to think globally, extend their scope across a broad array of Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. You asset classes, and be nimble as market conditions change. We encourage you to talk with your financial cannot invest directly in an index. advisor and visit blackrock.com for further insight about investing in today’s markets. Sincerely, Rob Kapito President, BlackRock Advisors, LLC 2 T HIS P AGE IS N OT P ART OF Y OUR F UND R EPORT Table of Contents Page The Markets in Review ........................................................................................................................................................... 2 Annual Report: Fund Summary .................................................................................................................................................................. 4 About Fund Performance ......................................................................................................................................................... 7 Disclosure of Expenses .......................................................................................................................................................... 7 Derivative Financial Instruments .................................................................................................................................................. 7 Fund Financial Statements: Schedule of Investments ...................................................................................................................................................... 8 Statement of Assets and Liabilities ............................................................................................................................................. 11 Statement of Operations ....................................................................................................................................................... 13 Statements of Changes in Net Assets .......................................................................................................................................... 14 Fund Financial Highlights ........................................................................................................................................................ 15 Fund Notes to Financial Statements .............................................................................................................................................. 20 Report of Independent Registered Public Accounting Firm ......................................................................................................................... 27 Important Tax Information ........................................................................................................................................................ 28 Director and Officer Information of the Fund ....................................................................................................................................... 29 Master Advantage Large Cap Core Portfolio