Nevada tabs Putnam to provide an adviser-sold 529

Firm was recently replaced by BlackRock to run Ohio's plan; 'a foot in the door'

Just four months after it was replaced as the program manager of Ohio’s Section 529 college savings plan, Putnam Investments has been chosen by Nevada to provide a new adviser-sold 529 plan.
Starting Oct. 1, the Putnam 529 Plan for America will be available to financial advisers, Robert Reynolds, president and chief executive of Putnam, said today at a news conference. Neither the firm nor Nevada state officials would disclose any of the features or fees of the plan until that date, he said.
Nevada also has an adviser-sold 529 plan offered through Columbia Management Group LLC, whose contract ends in the spring, The state hasn’t yet decided if it will maintain Columbia as a partner after that, Nevada State Treasurer Kate Marshall said at the press conference.
For Putnam, being chosen by Nevada comes at a good time. In May, Ohio dumped the fund firm and hired BlackRock Inc. as the manager of its 529 plan.
The challenge for Putnam will be to build the business, said Laura Lutton, an analyst at Morningstar Inc. Although Ohio’s adviser-sold plan had $3.3 billion in assets as of Aug. 31, Nevada’s only had $108 million, according to Morningstar.
“Putnam will be growing its business there from zero,” Ms. Lutton said. “But the contract gives the firm a foot in the door.”
With Nevada under its belt, Putnam again has a presence in the national 529 industry — and observers are anxious to see what its investment lineup will be.
“We have seen several 529 plans come out with more conservative options since 2008,” Ms. Lutton said. “It will be interesting to see what Putnam does.”