Putnam Investments is sharing with its customers some of the rewards it has reaped from the long-running bull market.

Thirteen Putnam funds were to be converted starting last week from a class-B pricing format to an "A-share" format in less than the scheduled eight years described in the funds' prospectuses.

That will reduce a typical fund's expense ratio by 75 basis points, increasing investors' net returns. The funds will convert as early as six years after investors bought their shares.

"The above-average performance of stock funds has allowed Putnam to earn back our fronted commission earlier than scheduled," said David B. Edlin, managing director who oversees Putnam's bank channel sales. "That will enable us to reduce fees and allow investors to earn better returns."

The change was made at the behest of Putnam's board of trustees, which is known in the industry for its assertive role in business decisions like this one.

"It's more active than any other board in the industry," said one fund industry consultant, who asked to remain anonymous.

The move by the Boston-based company may pressure fund companies that use seven- or eight-year windows to follow its lead, the consultant said.

The A shares carry an up-front sales charge, and B shares have back-end sales fees, which let investors defer payment of commissions until they redeem the shares.

Although some companies, like OppenheimerFunds, New York, have always used a six-year window for their B shares, seven or eight is the industry norm.

"It's groundbreaking," said Louis Harvey, president of Dalbar, a Boston consulting company. "It's also a reflection on Putnam's success."

Under the B-share format, fund companies pay brokers an up-front commission and use a so-called 12b-1 annual fee to recoup that payout.

The stock market has performed so well in recent years that assets have grown faster than Putnam anticipated. Thus, the company has recouped through 12b-1 fees the money it laid out for broker commissions faster than expected.

Putnam executives said their company is the first to shrink the window for converting B shares to A shares. A shares carry lower 12b-1 fees because investors themselves pay the broker commissions.

Putnam's move reduces the 12b-1 fee on the affected funds to 25 basis points, from 100.

The funds involved are George Putnam, Voyager; Global Growth; Growth and Income; Tax-Free High Yield; Utilities Growth and Income; Capital Appreciation; Investors; Health Sciences; New Opportunities; Vista; OTC & Emerging Growth, and High Yield Trust.

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