Putnam stakes claim in 401(k) market

Putnam Investments of Boston today launched a new defined contribution platform for advisers and clients, signaling its expansion into the 401(k) market.
MAR 25, 2009
Putnam Investments of Boston today launched a new defined contribution platform for advisers and clients, signaling its expansion into the 401(k) market. The platform will provide plan sponsors with a range of investment choices, plan designs and record-keeping. The record-keeping services will be provided through FASCore LLC, a subsidiary of Great-West Lifeco Inc. in Greenwood Village, Colo., which is part of the Power Financial Corp. of Montreal, the parent company of Putnam. The 401(k) program will offer not only Putnam's proprietary mutual fund offerings, including its recently launched Absolute Return Fund series, but will also include investment options from other fund groups through open architecture. The program will have a range of default investment alternatives options. Prior to today’s move, Putnam offered defined contribution services on another platform which served predominantly small and mid-sized companies. The firm has $13 billion in defined contribution assets under management. The new program will allow the firm to serve plans of all sizes. “The technology allows us to be more efficient and flexible in bringing more products and features to the marketplace,” said Jeffrey Carney, head of global marketing and products at Putnam. Still, the defined contribution market is a competitive one. “The legacy of the defined contribution market is that it constantly improves,” Mr. Carney said. “This market has tested the retirement system. We believe we can add value and do it fairly quickly.” The move to expand its defined contribution offerings follows the firm's recent hiring of Mr. Carney and Edmund Murphy as co-heads of Putnam's defined contribution business, part of Putnam's overall turnaround strategy. “We have a vision and strategy that we are executing and the market is not going to stop us from doing that,” he said. Mr. Carney, hired in October, formerly served as president of Charlotte, N.C.-based Bank of America's retirement and global wealth and investment client solutions group and, before that, as the head of Fidelity Investments Retirement Services of Boston. Mr. Murphy, hired in February, previously served at Fidelity in several senior positions including executive vice president of distribution for personal and workplace investing and as executive vice president of Fidelity Institutional Retirement Services Co. Putnam managed $96 billion in assets as of Feb. 28.

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