Due to a net loss of $676 million in the fourth quarter, Marsh & McLennan Cos. announced Tuesday it will slash 2,500 more jobs to save $375 million a year, following an earlier downsizing of 3,000 jobs to recognize $400 million in annual savings.
The firm also said profits at its Putnam Investments unit declined 24% in the fourth quarter to $421 million from a year earlier, as assets fell to $213 billion, down 11% from $240 billion. Putnam also took an $80 billion charge in the period related to regulatory settlements.
MMC will also cut its dividend for the first time in 40 years, by 50% to 17 cents a share.
Both MMC and Putnam have been reeling since they have been sued for bid-rigging, price fixing and mutual fund market timing. However, MMC Chief Executive Michael Cherkasky said in a statement that by next year, the staff reductions at the parent company will enable the firm to deliver profit margins in the high teens.