MMC Increases Dividend

Marsh & McLennan Companies Inc. said it would increase its quarterly cash dividend 12 percent, or two cents a share.

The New York-based professional services firm, parent company of insurance broker Marsh, said it increased the dividend on its common stock from 17 cents to 19 cents a share. The dividend will be payable on Feb. 15 to shareholders of record as of Jan. 24.

It was recently reported, but not confirmed, that MMC plans to sell its Putnam investment firm to Montreal-based Powers Corp. Among the financial holdings Powers owns are several life insurance companies and investment groups.

Such a move would give Powers a foothold in the United States. It already does investment management in Canada through Mackenzie Financial Corp.

MMC has been urged by investors to divest Putnam because it does not fit in with its core insurance brokerage service, Marsh, and related services Mercer Consulting service and Kroll risk consulting.

In 2003, Putnam was embroiled in allegations of improprieties by then New York Attorney General Eliot Spitzer.

The scandal concerned portfolio managers' illegal sale of mutual funds through market timing, or rapid sale of the funds. The allegations resulted in Boston-based Putnam agreeing to pay regulators $55 million in penalties and disgorgement of profits.

Since then, Putnam has struggled to regain its worth and reputation as investors–primarily pension funds–pulled their investments out from the firm. The company has watched its assets under management dip to its current $191 billion, down from $240 billion in 2003.