Putnam Plans Fund-Fee Cuts
Putnam Investments, weary of serving as an example of all that's gone awry in the mutual fund industry, said Tuesday it will cut costs and provide investors with more user-friendly documentation regarding its fee structure.
The sixth-largest fund company, a unit of insurance giant Marsh & McLennan, voluntarily reduced fees so that all of its funds will be below their category average.
"Putnam is determined to earn back the trust and confidence of the marketplace," Putnam Chief Executive Ed Haldeman said in a statement. The firm now manages $161.5 billion in assets, a result of steady outflows in the past four months. Assets dropped 12% in November, and 1% in December -- although given the market's rise last month, net outflows were more like $6 billion, according to AMG Data.
Putnam has been battling securities fraud charges since October. In November, the firm fired its chief executive and later dismissed 15 other employees, including six portfolio managers, for market timing.Putnam has also instituted a raft of new controls aimed at protecting shareholders from the frequent in-and-out trading that allows market timers to skim fund profits at the expense of longer-term investors. The firm has
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