S&P Revises MMC Outlook

S&P Revises MMC Outlook

NU Online News Service, Nov. 5, 12:40 p.m. EST?New York City-based Standard & Poor's Rating Services has revised its outlook on Marsh & McLennan Companies to negative from stable and affirmed its double-A-minus/A-plus counterparty credit rating on the company.

"The revised outlook reflects Standard & Poor's concern that the adverse effect of the highly publicized legal actions instituted by the State of Massachusetts and the SEC against its subsidiary, Putnam Investments, might, over the long term, weaken Putnam's strong business position," said Steven Ader, S&P credit analyst, in a statement.

He continued that this, along with "MMC's industry-leading position as the world's largest risk and insurance services firm, is a key underpinning of MMC's diversified business profile."

S&P noted that despite the naming of a new senior management team and the commencement of an independent review of Putnam's policies and controls, there could be long-term effects on the company as a whole, which could weaken the firm.

On Monday, MMC replaced Putnam's longtime chief executive, Lawrence Lasser. The move followed recent allegations by the Securities and Exchange Commission and by Massachusetts officials that Putnam permitted illegal market-timed trading by some of its investment managers.

Mr. Lasser was replaced by Charles Haldeman, senior managing director and co-head of investments at Putnam.

MMC is the parent company of global insurance broker Marsh.