Deals & People January 5, 2011

Consultant Relations Under New Leadership at Putnam

Putnam Investments announced the promotions of Robert E. Alan to Head of North America Consultant Relations and Keith E. Thomas to Head of International Consultant Relations.
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Alan and Thomas will lead Putnam’s efforts to work with the consultants who advise institutional investors on investment strategy and the selection of managers. Putnam said the appointments are an effort to significantly bolster its global institutional management consultant relations capabilities.  

According to a press release, Alan joined the company in 2006 as a Senior Vice President and Consultant Relations Manager, North America, West Region, and subsequently moved to the Northeast to serve as Consultant Relations Manager North America, East Region. He has more than 17 years of investment industry experience, having earlier worked in consultant relations for Babson Capital Management and Fidelity Management Trust Company and as an internal wholesaler at Fidelity Investments Institutional Services Company. He holds a B.S. degree from Bentley University and will be based in Boston. 

Thomas has more than two decades of experience in the investment industry, the announcement said. He joined Putnam in 2006 as Consultant Relations Manager and subsequently served as Head of European Consultant Relations and International Account Manager. Previously, he was responsible for both consultant and multi-manager relationships at Resolution Asset Management in the United Kingdom. He also held senior institutional business roles at Baring Asset Management, and began his career as a consultant with William M. Mercer Ltd. He is a graduate of Cheshunt Grammar School and will be based in London. 
Compliance January 5, 2011

Judge Settles on Alliant Payout Interest Rate

A federal judge in Wisconsin has ordered Alliant Energy Corp. to use an 8.2% interest rate when it carries out lump-sum distributions from its cash balance program.
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With that ruling, U.S. District Judge Barbara B. Crabb of the U.S. District Court for the Western District of Wisconsin effectively turned aside dueling recommendations from experts retained by both sides; the plaintiffs’ expert argued for 8.45% while Alliant’s expert contended 7.63% was the preferable rate.

Crabb had ruled in mid-2010 that Alliant ran afoul of the Employee Retirement Income Security Act (ERISA) by using a 30-year Treasury rate in making the payout calculations for employees opting for the payments between 1998 and 2006 before reaching normal retirement age (see “Alliant Tagged for Pre PPA Whipsaw Calculation“). The Pension Protection Act amended ERISA to provide that cash balance plans are no longer required to make whipsaw calculations.

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“Plaintiffs are entitled to a rate that fairly reflects what they should have been credited, but no more,” Crabb wrote in her latest opinion. “The interest credits that will be applied to plaintiffs’ lump sum benefits are a windfall available only to plaintiffs, not to any other participants in the plan, and available only for the period in which the Internal Revenue Service required the whipsaw calculation.”

In late December, Crabb issued an order dealing with determining damages in the case (see “District Court Issues Order on Cash Balance Suit Damages“).  

The case is Ruppert v. Alliant Energy Cash Balance Pension Plan, W.D. Wis., No. 08-cv-127-bbc.

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