December 3, 2003

Sacramento, CA – The California State Teachers’ Retirement System announced today it has terminated its relationship with Putnam Investments.

Putnam has recently come under scrutiny for failing to act when its compliance office reported improper trading activities. Although the infractions did not directly affect the CalSTRS portfolio, CalSTRS Chief Investment Officer Christopher Ailman said at today’s Investment Committee meeting he has concluded there were other fund managers who could better service the account.

Putnam managed a large-cap growth account totaling $312 million within CalSTRS’ $45 billion U.S. equity portfolio. The Putnam portfolio has been distributed among other firms already managing U.S. equity portfolios for CalSTRS.

CalSTRS, with a $107 billion portfolio, is the nation’s third largest public pension fund. It administers retirement, disability and survivor benefits for California’s public school educators in grades kindergarten through community college, serving more than 715,000 members and benefit recipients.