The California State Teachers' Retirement System, Sacramento, today terminated Putnam Investments from a $312 million active domestic large-cap growth equity portfolio. While the firm's alleged trading abuses did not directly affect the $100 billion system's portfolio, Chief Investment Officer Christopher Ailman told investment committee members that other managers could "better service the account." The money will be redistributed among the system's existing domestic equity managers, and the system will not seek a new large-cap growth manager, said Sherry Reser, spokeswoman.
"We are disappointed by CalSTRS' decision," said Sinead Martin, Putnam spokeswoman. "Many other clients have expressed their trust in Putnam and we are grateful for their support at this time. Under our new management team, we are putting in place a number of reforms that we think will come to be recognized by our investors."