MA Fund Brings On Putnam Replacements

June 4, 2004 ( - The state of Massachusetts has tapped two new money managers to run $1.2 billion in international equities for its pension fund - in large measure replacing the beleaguered and scandal-plagued Putnam Investments.

Named to manage $600 million each for the $32.1 billion pension fund were Boston Co. Asset Management, a unit of Mellon Financial Corp., and Scotland-based Baillie Gifford & Co, Bloomberg said.

The state fired Putnam from managing $1.74 billion of U.S. and international stocks October 30 after state and federal regulators accused Putnam managers and some clients of improper and frequent mutual-fund trading (See  PA, RI, VT, IA, NY Pensions Fire Putnamm  ).The pension’s executive director, Michael Travaglini, told reporters that Putnam wasn’t one of 12 finalists out of 44 companies that applied for the mandate.

Putnam also revealed this week that it had split its distribution channel and appointed new executives to head each area including institutional clients. (See  Putnam Splits Distribution Operation ). 

Charles Haldeman, Putnam’s president and chief executive officer, announced in an internal memo later released by the company that John Boneparth will assume responsibility for Domestic and International Institutional business and International Alliances.At the same time, Rich Monaghan was tapped as head of Putnam’s Domestic and Offshore Retail Management and Shareholder Communications.

The two men take over for John Brown, currently senior managing director and head of Institutional Management. Haldeman said in the memo that Brown was leaving the company for personal reasons after a seven-year tenure.