Putnam Investments

, rattled by subpar performance, earlier this week announced a broad restructuring that will include the ouster of a dozen fund managers and elimination, by merger, of six equity mutual funds.

In recent months, Putnam has managed to qualify only one of its equity funds in the "A" category of grades computed by TheSteet.com Ratings. The company's 41 funds are summarized in an accompanying table showing their breakdown by percentages in the various grade categories since December 2007.

The portion of Putnam equity funds in the "D" and "E" ranges, which equate with "sell" recommendations, has fluctuated between 39% and 63%, as can be seen in a second table.

Putnam's once-pristine reputation was tarnished by depressing fund performance during the 2000-02 bear market and then dragged through the mud when the firm got caught up in the market-timing scandal shortly afterward.

Another adjoining summary table of recent performances of the Boston firm's equity funds explains why Putnam is struggling to rejuvenate its image. Only nine of its 41 equity funds have managed to outperform the

S&P 500

total return index over the three months ended Oct. 31. Two offerings imploded more than 40%.

For the past year, only 11 of its funds managed to outperform the S&P 500. Two crumbled more than 50%, while 16 others sank more than 40%.

The subpar performance has been happening for more than just the past year. Six Putnam equity funds have fallen more than an annualized 10% rate over three years, a period when only nine of the firm's 41 equity funds outperformed the S&P 500.

Of all the firm's equity funds, only the

Putnam Utilities Growth & Income Fund

(PUGIX)

, with an anemic 0.87% growth rate, has managed a positive annual rate of return over the past three years.

The firm announced that, in the next month or two, the

Putnam Capital Appreciation Fund

(PCAPX) - Get Report

and the

Putnam Tax Smart Equity Fund

(PVISX)

will be merged into the

Putnam Investors Fund

(PINVX)

. The

TheStreet Recommends

Putnam Classic Equity Fund

(PXGIX)

will meld with

The Putnam Fund for Growth and Income

(PGRWX)

, while the

Putnam Discovery Growth Fund

(PVIIX)

will combine with the

Putnam New Opportunities Fund

(PNOPX) - Get Report

. The

Putnam New Value Fund

(PANVX)

will be acquired by the

Putnam Equity Income Fund

(PEYAX) - Get Report

, and the

Putnam OTC Emerging Growth Fund

(POEGX)

will combine with the

Putnam Vista Fund

(PVISX)

.

Richard Widows is a senior financial analyst for TheStreet.com Ratings. Prior to joining TheStreet.com, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.