-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, G4As46Duqn6szRQtsXlLulbcokwi8icSu8zbmcD5buvI9ZGrqpRutAcY9LcrytMA /PHCCy2LlEdxOVp2PPi8kQ== 0000928816-96-000358.txt : 19961203 0000928816-96-000358.hdr.sgml : 19961203 ACCESSION NUMBER: 0000928816-96-000358 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961202 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUTNAM MONEY MARKET FUND CENTRAL INDEX KEY: 0000081248 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 046386436 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-02608 FILM NUMBER: 96674728 BUSINESS ADDRESS: STREET 1: ONE POST OFFICE SQ STREET 2: MAILSTOP A-14 LEGAL DEPARTMENT CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6172921141 MAIL ADDRESS: STREET 1: MAILSTOP A-14 LEGAL DEPARTMENT STREET 2: ONE POST OFFICE SQUARE CITY: BOSTON STATE: MA ZIP: 02109 FORMER COMPANY: FORMER CONFORMED NAME: PUTNAM DAILY DIVIDEND TRUST DATE OF NAME CHANGE: 19920703 N-30D 1 PUTNAM MONEY MARKET FUND Putnam Money Market Fund ANNUAL REPORT September 30, 1996 [LOGO: BOSTON * LONDON * TOKYO] Fund highlights * "We will continue to monitor the economy and interest rates carefully, keeping the fund focused on quality and flexibly positioned for what lies ahead." -- Lindsey C. Strong, Manager Putnam Money Market Fund * "Total assets in money funds . . . reached $856.7 billion at the end of August, according to IBC/Financial Data in Ashland, MA, surpassing for the first time the $806.4 billion that the Investment Company Institute, the Washington trade group, counted in bond/income funds." -- The New York Times, September 29, 1996 CONTENTS 4 Report from Putnam Management 7 Fund performance summary 12 Portfolio holdings 15 Financial statements From the Chairman [GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM] (copyright) Karsh, Ottawa Dear Shareholder: Unsettled fixed-income markets and uncertainty over the course of short- term interest rates provided most of the challenges for Fund Manager Lindsey Strong throughout Putnam Money Market Fund's fiscal year that ended September 30, 1996. By continually adjusting the average maturity of the portfolio and maintaining the fund's conservative strategy of investing in high-quality short-term investments, she was able to deliver another year of competitive performance while maintaining a stable net asset value. As your fund moves into fiscal 1997, Lindsey sees a continuation of this general environment in prospect, especially as Washington and the rest of the nation adjust to the results of the November elections. In the report that follows, Lindsey discusses in detail the driving forces behind your fund's fiscal 1996 performance and her outlook for the fiscal year ahead. Respectfully yours, /S/George Putnam George Putnam Chairman of the Trustees November 20, 1996 Report from the Fund Manager Lindsey C. Strong In the fiscal year ended September 30, 1996, Putnam Money Market Fund once again provided shareholders with a competitive total return while continuing to focus on capital preservation and maintaining a stable $1.00 share price. The fund's conservative investment strategy, which emphasizes superior-quality short-term instruments and the pursuit of current income, served it well during the year's environment of continued economic strength, slightly higher interest rates, and diminished inflationary expectations. * ECONOMIC STRENGTH WITHOUT INFLATION Economic strength continued throughout the period, although certain indicators showed some softening as September drew to a close. Unemployment figures stayed low, while retail sales, home and vehicle sales, and consumer confidence remained relatively robust. At the same time, inflationary pressures did not materialize, despite ongoing market worries to the contrary. The Federal Reserve Board, believing that the economy would soon slow enough on its own, did not raise short-term interest rates in September as many had expected. In fact, over the summer, demand did seem to be tapering a bit as retail sales growth edged lower, exports softened, and home sales came off their earlier peaks. * STAYING NEUTRAL AND FLEXIBLE With the economy's strength, the potential for inflation, and the possibility of a Fed interest-rate increase somewhat unclear, your portfolio remained in a flexible position throughout the period. This meant keeping portfolio duration relatively neutral -- rather than short or long -- in order to be ready to take advantage of incrementally higher yields, should interest rates begin to rise. Throughout the period, we sought out securities offering strong value and solid yield. The portfolio adopted a barbell structure, focusing primarily on superior-quality corporate and government agency securities at both the short and long ends of the money-market maturity spectrum. In the current interest-rate environment, this configuration allowed the fund to maximize its income stream while protecting its net asset value. * CAPTURING VALUE AMID MARKET UNCERTAINTY During the latter half of the period, market opinion coalesced around the idea that the economy's strength would soon force the Fed to raise interest rates. In fact, for some time during the period, these expectations dramatically cheapened the prices of money-market instruments in the longer six-month maturity range. Because our expectations with regard to interest-rate increases were more conservative, we took advantage of the opportunity to add attractively priced high-quality issues to the portfolio. This move proved rewarding. Not only did this strategy boost the fund's income stream, but since the Fed left rates alone, it enabled the fund to capture some of the highest yields available over the past 12 months. * SUPPLY STEADY; CREDIT-CONSCIOUS BUYERS ABOUND The supply of money-market securities remained relatively steady and strong for much of the year. Demand, however, assumed a rather cautious tone as buyers exhibited renewed enthusiasm for the most conservative money-market investments. Essentially, most market participants are getting back to basics, eschewing the derivative investments that were once such popular income vehicles and scrutinizing the credit quality of even those securities once thought to be above question. Your fund has always concentrated on traditional money-market securities of the highest quality. In this time of interest-rate uncertainty and increased credit consciousness, we have redoubled efforts to find well- valued securities that meet our criteria for quality, liquidity, and price sensitivity. Ideally, every holding must be rated in one of the two highest categories by at least two nationally recognized rating services at the time of purchase. If only one rating service has evaluated the security, it must be rated in one of the two highest categories by that service. If the securities are unrated, they must be judged by Putnam Management to be of equivalent quality. * OUTLOOK REMAINS CAUTIOUSLY OPTIMISTIC It would appear that economic growth has begun to moderate, while inflationary pressures remain subdued. After expecting the Fed to raise interest rates, many market participants see the possibility of an ease in rates, should the economy slow significantly. Given these mixed signals, we expect the market to remain somewhat unsettled over the near term. We believe the portfolio's neutral duration and concentration in superior-quality issues should continue to serve shareholders well by preserving share price and income stream amid this challenging environment. The views expressed throughout the report are exclusively those of Putnam Management and are not meant as investment advice. Although the described holdings were viewed favorably as of 9/30/96, there is no guarantee the fund will continue to hold these securities in the future. PERFORMANCE COMPARISONS (9/30/96) Current return - ----------------------------------------------------------------------- Passbook savings account 2.01% - ----------------------------------------------------------------------- 3-month certificate of deposit 4.04 - ----------------------------------------------------------------------- Taxable money-market fund (7-day yield) 4.86 - ----------------------------------------------------------------------- Putnam Money Market Fund (7-day yield) - ----------------------------------------------------------------------- Class A 5.00 - ----------------------------------------------------------------------- Class B 4.43 - ----------------------------------------------------------------------- Class M 4.80 - ----------------------------------------------------------------------- The net asset value of money-market mutual funds is uninsured and designed to be fixed, while distributions vary daily. Investment returns will fluctuate. The principal value on passbook savings and bank CDs is generally insured up to certain limits by state and federal agencies. CDs, unlike stocks which incur more risk, offer a fixed rate of return. Unlike money-market funds, early withdrawals from bank CDs may be subject to substantial penalties. Sources: Bank of Boston (passbook savings), Bank Rate Monitor (3-month CDs), IBC/Donaghue's Money Fund Report (taxable money-market fund 7-day yield). Performance summary Performance should always be considered in light of a fund's investment strategy. Putnam Money Market Fund is designed for investors seeking current income, consistent with capital preservation, stable principal, and liquidity. This section provides, at a glance, information about your fund's performance. Total return shows how the value of the fund's shares changed over time, assuming you held the shares through the entire period and reinvested all distributions in the fund. TOTAL RETURN FOR PERIODS ENDED 9/30/96 Class A Class B Class M (inception date) (10/1/76) (4/27/92) (12/8/94) at NAV at NAV at CDSC at NAV - ----------------------------------------------------------------------- 1 year 5.19% 4.67% -0.33% 5.02% - ----------------------------------------------------------------------- 5 years 21.72 -- -- -- Annual average 4.01 -- -- -- - ----------------------------------------------------------------------- 10 years 71.55 -- -- -- Annual average 5.55 -- -- -- - ----------------------------------------------------------------------- Life of class -- 16.43 14.43 9.67 Annual average -- 3.49 3.09 5.20 - ----------------------------------------------------------------------- COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 9/30/96 Lipper Consumer Money Market Fund Price Average Index - ----------------------------------------------------------------------- 1 year 4.90% 3.00% - ----------------------------------------------------------------------- 5 years 21.38 15.02 Annual average 3.95 2.84 - ----------------------------------------------------------------------- 10 years 71.04 43.19 Annual average 5.51 3.66 - ----------------------------------------------------------------------- Life of class B 18.51 13.12 Annual average 3.92 2.82 - ----------------------------------------------------------------------- Life of class M 9.61 5.41 Annual average 5.13 2.94 - ----------------------------------------------------------------------- Fund performance data do not take into account any adjustment for taxes payable on reinvested distributions. Performance data represent past results and are not indicative of future returns. Investment returns will fluctuate. An investment in the fund is neither insured nor guaranteed by the U.S. government. There can be no assurance that the fund will be able to maintain a stable net asset value of $1.00 per share. The fund's holdings do not match those in the Lipper Average. DISTRIBUTION INFORMATION 12 months ended 9/30/96 Class A Class B Class M - ----------------------------------------------------------------------- Distributions (number) 12 12 12 - ----------------------------------------------------------------------- Income $0.050744 $0.045693 $0.049038 - ----------------------------------------------------------------------- Total $0.050744 $0.045693 $0.049038 - ----------------------------------------------------------------------- Current return: (end of period) - ----------------------------------------------------------------------- Current 7-day yield1 5.00% 4.43% 4.80% - ----------------------------------------------------------------------- Current 30-day yield1 4.91 4.39 4.72 - ----------------------------------------------------------------------- 1 The 7-day and 30-day yields are the two most common gauges for measuring money market mutual fund performance. TERMS AND DEFINITIONS Class A shares generally are fund shares purchased with an initial sales charge. In the case of your fund, which has no initial sales charge, the reference is to shares purchased or acquired through the exchange of class A shares from another Putnam fund. Exchange of your fund's class A shares into another fund may involve a sales charge, however. Class B shares generally are fund shares purchased with no initial sales charge but subject to a contingent deferred sales charge (CDSC) upon redemption. However, class B shares of your fund can be acquired only through exchange of class B shares from another fund or purchased by certain systematic plan shareholders. A contingent deferred sales charge is a charge applied at the time of redemption of class B shares and assumes redemption at the end of the period. The CDSC schedule will vary depending on whether the shares were acquired through exchange or through a systematic investment plan purchase. Consult your prospectus for details. Class M shares generally have a lower initial sales charge and a higher 12b-1 fee than class A shares and no sales charge on redemption. In the case of your fund, which has no initial sales charge, exchange of your fund's class M shares into another fund may involve a sales charge, however. Net asset value (NAV) is the value of all your fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial or contingent deferred sales charge. COMPARATIVE BENCHMARKS Lipper Money Market Fund Average, used for performance comparison purposes, is an arithmetic average of the total return of all money market mutual funds tracked by Lipper Analytical Services. Lipper is an independent rating organization for the mutual fund industry. Lipper rankings vary for other periods. The fund's holdings do not match those in the Lipper Average and it is not possible to invest directly in an index. Consumer Price Index (CPI) is a commonly used measure of inflation; it does not represent an investment return. PUTNAM GROWTH FUNDS Asia Pacific Growth Fund Capital Appreciation Fund Diversified Equity Trust Europe Growth Fund Global Growth Fund Global Natural Resources Fund * Health Sciences Trust International Growth Fund + International New Opportunities Fund Investors Fund New Opportunities Fund OTC Emerging Growth Fund Vista Fund Voyager Fund Voyager Fund II PUTNAM GROWTH AND INCOME FUNDS Balanced Retirement Fund Convertible Income-Growth Trust Equity Income Fund The George Putnam Fund of Boston The Putnam Fund for Growth and Income Growth and Income Fund II International Growth and Income Fund New Value Fund Utilities Growth and Income Fund PUTNAM INCOME FUNDS American Government Income Fund Diversified Income Trust Diversified Income Trust II Federal Income Trust Global Governmental Income Trust High Yield Advantage Fund High Yield Trust Income Fund Intermediate U.S. Government Income Fund Preferred Income Fund U.S. Government Income Trust PUTNAM TAX-FREE INCOME FUNDS Municipal Income Fund Tax Exempt Income Fund Tax-Free High Yield Fund Tax-Free Insured Fund State tax-free income funds [DBL. DAGGER] Arizona, California, Florida, Massachusetts, Michigan, Minnesota, New Jersey, New York, Ohio and Pennsylvania LIFESTAGESM FUNDS Putnam Asset Allocation Funds--three investment portfolios that spread your money across a variety of stocks, bonds, and money market investments to help maximize your return and reduce your risk. The three portfolios: Asset Allocation: Balanced Portfolio Asset Allocation: Conservative Portfolio Asset Allocation: Growth Portfolio MOST CONSERVATIVE INVESTMENTS [SECTION MARK] Putnam money market funds: ** California Tax Exempt Money Market Fund Money Market Fund New York Tax Exempt Money Market Fund Tax Exempt Money Market Fund CDs and savings accounts [DBL. DAGGER] * Formerly Natural Resources Fund + Formerly Overseas Growth Fund [DBL. DAGGER] Not available in all states. [SECTION MARK] Relative to above. ** An investment in a money market fund is neither insured nor guaranteed by the U.S. government. These funds are managed to maintain a price of $1.00 per share, although there is no assurance that this price will be maintained in the future. ++ Not offered by Putnam Investments. Certificates of deposit offer a fixed rate of return and may be insured up to certain limits by federal/state agencies. Savings accounts may also be insured up to certain limits. Please call your financial advisor or Putnam at 1-800- 225-1581 to obtain a prospectus for any Putnam fund. It contains more complete information, including charges and expenses. Please read it carefully before you invest or send money. Report of independent accountants To the Trustees and Shareholders of Putnam Money Market Fund In our opinion, the accompanying statement of assets and liabilities, including the portfolio of investments owned, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Putnam Money Market Fund (the "fund") at September 30, 1996, and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with generally accepted accounting principles. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with generally accepted auditing standards which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of investments owned at September 30, 1996 by correspondence with the custodian, provide a reasonable basis for the opinion expressed above. Price Waterhouse LLP Boston, Massachusetts November 11, 1996
Portfolio of investments owned September 30, 1996 COMMERCIAL PAPER (73.9%)* PRINCIPAL AMOUNT MATURITY DATE VALUE Domestic (57.5%) - ------------------------------------------------------------------------------------------------------------------------------ $17,000,000 A.H. Robins Co. 5.40s 10/22/96 $16,943,900 20,000,000 AES Barbers Point (Bank of America (LOC)) 5.35s 10/25/96 19,925,694 12,000,000 Bank of America 5.33s 11/6/96 11,934,263 40,000,000 Bank of America 5.31s 11/13/96 39,740,400 20,000,000 Bank of New York 5.30s 10/2/96 19,994,111 25,000,000 Bank One Corp. 5.29s 10/24/96 24,911,833 15,000,000 Bellsouth Telecommunications Inc. 5.33s 11/21/96 14,884,517 30,000,000 Chase Manhattan Bank Corp. 5.59s 3/5/97 29,273,300 20,000,000 Chase Manhattan Bank Corp. 5.30s 12/10/96 19,790,944 30,000,000 Ciesco L.P. 5.30s 11/12/96 29,810,083 22,200,000 Ciesco L.P. 5.27s 10/7/96 22,177,251 25,000,000 Corporate Asset Funding Co. Inc. 5.45s 10/28/96 24,894,028 40,000,000 Corporate Asset Funding Co. Inc. 5.42s 12/19/96 39,518,222 10,000,000 Corporate Receivables Corp. 5.45s 10/21/96 9,968,208 25,000,000 Corporate Receivables Corp. 5.30s 11/7/96 24,860,139 45,074,000 Delaware Funding Corp. 5.30s 10/8/96 45,020,913 32,150,000 Falcon Asset Securitization Co. 5.40s 10/7/96 32,116,243 25,000,000 Ford Motor Credit Corp. 5.44s 10/17/96 24,935,778 28,500,000 Ford Motor Credit Corp. 5.33s 11/18/96 28,293,240 20,000,000 General Electric Capital Services 5.43s 10/29/96 19,912,517 30,000,000 General Electric Capital Services 5.33s 12/2/96 29,720,175 50,000,000 General Motors Acceptance Corp. 5.35s 10/29/96 49,784,514 30,000,000 Hewlett-Packard Co. 5.40s 11/27/96 29,739,000 20,000,000 Household Finance Co. 5.31s 10/30/96 19,911,500 35,000,000 Household Finance Co. 5.28s 10/23/96 34,881,933 30,000,000 IBM Credit Corp. 5.29s 10/3/96 29,986,775 40,000,000 International Business Machines Co. 5.42s 11/8/96 39,765,133 30,000,000 Merrill Lynch & Co., Inc. 5.48s 10/17/96 29,922,367 20,000,000 Merrill Lynch & Co., Inc. 5.33s 10/22/96 19,934,856 25,000,000 Merrill Lynch & Co., Inc. 5.31s 11/20/96 24,811,938 15,000,000 Metlife Funding Inc. 5.38s 10/1/96 14,997,758 20,000,000 Metlife Funding Inc. 5.28s 10/25/96 19,926,667 20,000,000 Metlife Funding Inc. 5.27s 10/16/96 19,953,156 20,000,000 Morgan (J.P.) & Co., Inc. 5.43s 12/12/96 19,779,783 25,000,000 Morgan (J.P.) & Co., Inc. 5.40s 11/15/96 24,827,500 7,350,000 National Rural Utilities Cooperative Finance Corp. 5.43s 10/28/96 7,318,959 30,000,000 Nationsbank Corp. 5.46s 10/10/96 29,954,500 35,000,000 Nationsbank Corp. 5.44s 10/31/96 34,836,044 15,475,000 Preferred Receivables Funding Corp. 5.45s 12/17/96 15,292,266 30,000,000 Preferred Receivables Funding Corp. 5.38s 11/19/96 29,775,833 30,000,000 Preferred Receivables Funding Corp. 5.30s 10/25/96 29,889,583 25,000,000 Sears Roebuck Acceptance Corp. 5.44s 10/21/96 24,920,667 20,000,000 Sears Roebuck Acceptance Corp. 5.43s 10/7/96 19,978,883 30,000,000 Sears Roebuck Acceptance Corp. 5.31s 11/19/96 29,778,750 9,250,000 Sheffield Receivables Corp. 5.35s 10/16/96 9,228,006 8,000,000 Sheffield Receivables Corp. 5.35s 10/1/96 7,998,811 16,500,000 Sheffield Receivables Corp. 5.32s 10/1/96 16,497,562 16,000,000 U.S. Bancorp 5.45s 12/11/96 15,825,600 19,500,000 USAA Capital Corp. 5.45s 11/5/96 19,393,725 25,000,000 Walt Disney Corp. 5.27s 11/22/96 24,806,035 -------------- $1,222,343,863 Foreign (16.4%) - ------------------------------------------------------------------------------------------------------------------------------ $25,000,000 ABN AMRO North America Finance 5.45s (Netherlands) 10/11/96 $24,958,368 25,000,000 ABN AMRO North America Finance 5.26s (Netherlands) 10/24/96 24,912,333 20,000,000 Banco Nacional de Mexico (Barclays Bank (LOC)) 5.38s (United Kingdom) 10/28/96 19,916,311 30,000,000 Bank of Montreal 5.40s (Canada) 10/28/96 29,874,000 25,000,000 Bank of Nova Scotia 5.43s (Canada) 12/19/96 24,698,333 15,000,000 Commerzbank AG 5.64s (Germany) 3/6/97 14,631,050 20,000,000 Commonwealth Bank of Australia 5.46s (Australia) 11/1/96 19,902,933 15,000,000 Commonwealth Bank of Australia 5.32s (Australia) 12/17/96 14,827,100 25,000,000 Commonwealth Bank of Australia 5.30s (Australia) 11/14/96 24,834,375 35,000,000 Den Dankse Bank 5.40s (Denmark) 10/21/96 34,889,750 15,000,000 Deutsche Bank Financial Inc. 5.36s (Germany) 11/4/96 14,921,833 15,000,000 Fletcher Challenge Finance U.S.A. (Credit Suisse (LOC)) 5.32s (Switzerland) 11/20/96 14,886,950 15,404,000 Michelin Tire Corp. (Societe Generale (LOC)) 5.40s (France) 11/4/96 15,323,129 10,000,000 PEMEX Capital, Inc. (Credit Suisse (LOC)) 5.47s (Switzerland) 11/20/96 9,922,508 15,000,000 PEMEX Capital, Inc. (Credit Suisse (LOC)) 5.42s (Switzerland) 10/21/96 14,952,575 20,000,000 Royal Bank of Canada 5.41s (Canada) 10/18/96 19,945,900 25,000,000 Swiss Bank Corp. 5.25s (Switzerland) 10/15/96 24,945,315 -------------- $348,342,763 -------------- Total Commercial Paper (cost $1,570,686,626) $1,570,686,626 U.S. GOVERNMENT & AGENCY OBLIGATIONS (11.9%) * PRINCIPAL AMOUNT MATURITY DATE VALUE - ------------------------------------------------------------------------------------------------------------------------------ Federal Home Loan Banks $23,005,000 5.70s 10/1/96 $23,005,000 17,070,000 5.38s 12/17/96 16,871,021 Federal Home Loan Mortgage Corp. Discount Notes 60,000,000 5.42s 12/20/96 59,268,300 25,000,000 5.38s 10/15/96 24,943,958 Federal National Mortgage Association Discount Notes 10,000,000 5.38s 10/15/96 9,977,583 10,000,000 5.38s 10/11/96 9,983,561 20,000,000 5.29s 12/6/96 19,803,094 25,320,000 5.25s 11/18/96 25,139,068 40,000,000 5.18s 10/9/96 39,948,200 25,000,000 5.06s 10/30/96 24,894,583 -------------- Total U.S. Government & Agency Obligations (cost $253,834,368) $253,834,368 CERTIFICATES OF DEPOSIT (9.2%) * PRINCIPAL AMOUNT MATURITY DATE VALUE - ------------------------------------------------------------------------------------------------------------------------------ $40,000,000 Bank of Nova Scotia 5.83s (Canada) 3/10/97 $ 40,003,481 25,000,000 Banque Nationale de Paris 5.35s (France) 10/21/96 25,000,290 20,000,000 Barclays Bank PLC 5.54s (United Kingdom) 1/27/97 20,003,271 40,000,000 Bayerische Vereinsbank AG 5.75s (Germany) 3/4/97 40,000,000 30,000,000 Canadian Imperial Bank of Commerce 5.33s (Canada) 10/28/96 30,000,232 40,000,000 Union Bank of Switzerland 5.37s (Switzerland) 11/25/96 40,000,000 -------------- Total Certificates of Deposit (cost $195,007,274) $ 195,007,274 BANK NOTES (2.6%) * PRINCIPAL AMOUNT MATURITY DATE VALUE - ------------------------------------------------------------------------------------------------------------------------------ $25,000,000 First National Bank of Boston 5.78s 3/12/97 $25,000,000 30,000,000 First National Bank of Boston 5.38s 11/21/96 30,000,000 -------------- Total Bank Notes (cost $55,000,000) $ 55,000,000 - ------------------------------------------------------------------------------------------------------------------------------ Total Investments (cost $2,074,528,268) *** $2,074,528,268 - ------------------------------------------------------------------------------------------------------------------------------ * Percentages indicated are based on net assets of $ 2,126,678,449. *** The aggregate identified cost on a tax basis is the same. The accompanying notes are an integral part of these financial statements.
Statement of assets and liabilities September 30, 1996 Assets - ------------------------------------------------------------------------------------------------------------ Investments in securities, at amortized cost (Note 1) $2,074,528,268 - ------------------------------------------------------------------------------------------------------------ Cash 2,219 - ------------------------------------------------------------------------------------------------------------ Interest and other receivables 1,490,992 - ------------------------------------------------------------------------------------------------------------ Receivable for shares of the fund sold 81,872,144 - ------------------------------------------------------------------------------------------------------------ Total assets 2,157,893,623 Liabilities - ------------------------------------------------------------------------------------------------------------ Distributions payable to shareholders 566,299 - ------------------------------------------------------------------------------------------------------------ Payable for shares of the fund repurchased 27,709,989 - ------------------------------------------------------------------------------------------------------------ Payable for compensation of Manager (Note 2) 1,778,428 - ------------------------------------------------------------------------------------------------------------ Payable for investor servicing and custodian fees (Note 2) 471,300 - ------------------------------------------------------------------------------------------------------------ Payable for compensation of Trustees (Note 2) 4,736 - ------------------------------------------------------------------------------------------------------------ Payable for administrative services (Note 2) 5,875 - ------------------------------------------------------------------------------------------------------------ Payable for distribution fees (Note 2) 207,633 - ------------------------------------------------------------------------------------------------------------ Other accrued expenses 470,914 - ------------------------------------------------------------------------------------------------------------ Total liabilities 31,215,174 - ------------------------------------------------------------------------------------------------------------ Net assets $2,126,678,449 Represented by - ------------------------------------------------------------------------------------------------------------ Paid-in capital (Note 4) $2,126,678,449 - ------------------------------------------------------------------------------------------------------------ Net asset value, offering and redemption price per class A share ($1,659,287,548 divided by 1,659,287,548 shares)* $1.00 - ------------------------------------------------------------------------------------------------------------ Net asset value and offering price per class B share ($438,315,892 divided by 438,315,892 shares)** $1.00 - ------------------------------------------------------------------------------------------------------------ Net asset value, offering and redemption price per class M share ($29,075,009 divided by 29,075,009 shares)* $1.00 - ------------------------------------------------------------------------------------------------------------ * Offered at net asset value. ** Class B shares are available only by exchange of class B shares from other Putnam funds and to certain systematic investment plan investors. The applicable contingent deferred sales charge will depend upon the fund from which you exchanged. The accompanying notes are an integral part of these financial statements.
Statement of operations Year ended September 30, 1996 Interest income: $100,213,638 - ----------------------------------------------------------------------------- Expenses: - ----------------------------------------------------------------------------- Compensation of Manager (Note 2) 6,008,179 - ----------------------------------------------------------------------------- Investor servicing and custodian fees (Note 2) 3,221,887 - ----------------------------------------------------------------------------- Compensation of Trustees (Note 2) 44,656 - ----------------------------------------------------------------------------- Administrative services (Note 2) 23,629 - ----------------------------------------------------------------------------- Distribution fees -- Class B (Note 2) 1,804,298 - ----------------------------------------------------------------------------- Distribution fees -- Class M (Note 2) 27,426 - ----------------------------------------------------------------------------- Reports to shareholders 89,496 - ----------------------------------------------------------------------------- Registration fees 408,824 - ----------------------------------------------------------------------------- Auditing 39,268 - ----------------------------------------------------------------------------- Legal 35,370 - ----------------------------------------------------------------------------- Postage 427,944 - ----------------------------------------------------------------------------- Other 24,625 - ----------------------------------------------------------------------------- Total expenses 12,155,602 - ----------------------------------------------------------------------------- Expense reduction (Note 2) (800,758) - ----------------------------------------------------------------------------- Net expenses 11,354,844 - ----------------------------------------------------------------------------- Net investment income 88,858,794 - ----------------------------------------------------------------------------- Net increase in net assets resulting from operations $88,858,794 - ----------------------------------------------------------------------------- The accompanying notes are an integral part of these financial statements.
Statement of changes in net assets Year ended Year ended September 30, September 30, 1996 1995 - ------------------------------------------------------------------------------------------------------------------------------ Increase in net assets - ------------------------------------------------------------------------------------------------------------------------------ Operations: - ------------------------------------------------------------------------------------------------------------------------------ Net investment income $88,858,794 $71,482,615 - ------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets resulting from operations 88,858,794 71,482,615 - ------------------------------------------------------------------------------------------------------------------------------ Distributions to shareholders - ------------------------------------------------------------------------------------------------------------------------------ From net investment income Class A (71,786,456) (59,886,945) - ------------------------------------------------------------------------------------------------------------------------------ Class B (16,189,187) (11,472,948) - ------------------------------------------------------------------------------------------------------------------------------ Class M (883,151) (122,722) - ------------------------------------------------------------------------------------------------------------------------------ Increase from capital share transactions (Note 4) 672,064,983 159,255,295 - ------------------------------------------------------------------------------------------------------------------------------ Total increase in net assets 672,064,983 159,255,295 - ------------------------------------------------------------------------------------------------------------------------------ Net assets - ------------------------------------------------------------------------------------------------------------------------------ Beginning of year 1,454,613,466 1,295,358,171 - ------------------------------------------------------------------------------------------------------------------------------ End of year $2,126,678,449 $1,454,613,466 - ------------------------------------------------------------------------------------------------------------------------------ The accompanying notes are an integral part of these financial statements.
Financial highlights (For a share outstanding throughout the period) December 8, 1994 (commencement Year ended of operations) Year ended September 30 to September 30 September 30 - --------------------------------------------------------------------------------------------------------------------------- 1996 1995 1996 - --------------------------------------------------------------------------------------------------------------------------- Class M - --------------------------------------------------------------------------------------------------------------------------- Net investment income $.0490 $.0434 $.0457 - --------------------------------------------------------------------------------------------------------------------------- Net realized gain on investments -- -- -- - --------------------------------------------------------------------------------------------------------------------------- Total from investment operations .0490 .0434 .0457 - --------------------------------------------------------------------------------------------------------------------------- Total distributions: $(.0490) $(.0434) $(.0457) - --------------------------------------------------------------------------------------------------------------------------- Total investment return at net asset value (%)(a) 5.02 4.43* 4.67 - --------------------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $29,075 $8,440 $438,316 - --------------------------------------------------------------------------------------------------------------------------- Ratio of expenses to average net assets (%)(b) .72 .67* 1.07 - --------------------------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets (%) 4.82 4.29* 4.51 - --------------------------------------------------------------------------------------------------------------------------- Financial highlights (Continued) (For a share outstanding throughout the period) For the eleven Year ended months ended Year ended September 30 September 30 October 31 - --------------------------------------------------------------------------------------------------------------------------- 1995 1994 1993 - --------------------------------------------------------------------------------------------------------------------------- Class B - --------------------------------------------------------------------------------------------------------------------------- Net investment income $.0469 $.0251 $.0195 - --------------------------------------------------------------------------------------------------------------------------- Net realized gain on investments -- -- -- - --------------------------------------------------------------------------------------------------------------------------- Total from investment operations .0469 .0251 .0195 - --------------------------------------------------------------------------------------------------------------------------- Total distributions: $(.0469) $(.0251) $(.0195) - --------------------------------------------------------------------------------------------------------------------------- Total investment return at net asset value (%)(a) 4.80 2.54* 1.98 - --------------------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $256,533 $194,187 $22,777 - --------------------------------------------------------------------------------------------------------------------------- Ratio of expenses to average net assets (%)(b) 1.12 1.03* 1.20 - --------------------------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets (%) 4.75 2.77* 1.98 - --------------------------------------------------------------------------------------------------------------------------- Financial highlights (Continued) (For a share outstanding throughout the period) April 27,1992 (commencement of operations) Year ended Year ended to October 31 September 30 September 30 - --------------------------------------------------------------------------------------------------------------------------- 1992 1996 1995 - --------------------------------------------------------------------------------------------------------------------------- Class A - --------------------------------------------------------------------------------------------------------------------------- Net investment income $.0151 $.0507 $.0521 - --------------------------------------------------------------------------------------------------------------------------- Net realized gain on investments -- -- -- - --------------------------------------------------------------------------------------------------------------------------- Total from investment operations .0151 .0507 .0521 - --------------------------------------------------------------------------------------------------------------------------- Total distributions: $(.0151) $(.0507) $(.0521) - --------------------------------------------------------------------------------------------------------------------------- Total investment return at net asset value (%)(a) 1.52* 5.19 5.33 - --------------------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $2,864 $1,659,288 $1,189,640 - --------------------------------------------------------------------------------------------------------------------------- Ratio of expenses to average net assets (%)(b) .70* .57 .62 - --------------------------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets (%) 1.50* 5.00 5.23 - --------------------------------------------------------------------------------------------------------------------------- Financial highlights (Continued) (For a share outstanding throughout the period) For the eleven months ended September 30 Year ended October 31 - --------------------------------------------------------------------------------------------------------------------------- 1994 1993 1992 - --------------------------------------------------------------------------------------------------------------------------- Class A - --------------------------------------------------------------------------------------------------------------------------- Net investment income $.0299 $.0246 $.0353 - --------------------------------------------------------------------------------------------------------------------------- Net realized gain on investments -- -- -- - --------------------------------------------------------------------------------------------------------------------------- Total from investment operations .0299 .0246 .0353 - --------------------------------------------------------------------------------------------------------------------------- Total distributions: $(.0299) $(.0246) $(.0353) - --------------------------------------------------------------------------------------------------------------------------- Total investment return at net asset value (%)(a) 3.03* 2.49 3.58 - --------------------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $1,101,171 $586,920 $839,185 - --------------------------------------------------------------------------------------------------------------------------- Ratio of expenses to average net assets (%)(b) .58* .70 .86 - --------------------------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets (%) 3.03* 2.48 3.56 - --------------------------------------------------------------------------------------------------------------------------- * Not annualized. (a) Total investment return assumes dividend reinvestment and does not reflect the effect of sales charges. (b) The ratio of expenses to average net assets for the periods ended September 30, 1995 and thereafter, includes amounts paid through expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
Notes to financial statements September 30, 1996 Note 1 Significant accounting policies Putnam Money Market Fund (the "fund"), is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The fund seeks current income consistent with preservation of capital and maintenance of liquidity. The fund achieves its objective by investing in a portfolio of high-grade short- term obligations. The fund may invest up to 100% of its assets in the banking industry and in commercial paper and short-term corporate obligations of issuers in the personal credit institution and business credit industries. The fund offers class A, class B and class M shares. Each class of shares is sold without a front-end sales charge. Class B shares are offered only in exchange for class B shares of other Putnam funds, or purchased by certain systematic investment plans. Shareholders are subject to the same contingent deferred sales charge schedule as the fund from which they were exchanged. Class B shares pay an ongoing distribution fee, and are subject to a contingent deferred sales charge if the shares are redeemed within six years of purchase (including any holding period of the shares in other Putnam funds). Class M shares pay an ongoing distribution fee lower than class B shares but are not subject to a contingent deferred sales charge. Expenses of the fund are borne pro-rata by the holders of each class of shares, except that each class bears expenses unique to that class (including the distribution fees applicable to class B and class M shares). Each class votes as a class only with respect to its own distribution plan or other matters on which a class vote is required by law or determined by the Trustees. Shares of each class would receive their pro-rata share of the net assets of the fund, if the fund were liquidated. In addition, the Trustees declare separate dividends on each class of shares. The following is a summary of significant accounting policies consistently followed by the fund in the preparation of its financial statements. The preparation of financial statements is in conformity with generally accepted accounting principles and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. Actual results could differ from those estimates. A) Security valuation The valuation of the fund's portfolio instruments is determined by means of the amortized cost method, which approximates market value, as set forth in Rule 2a-7 under the Investment Company Act of 1940. The amortized cost of an instrument is determined by valuing it at cost originally and thereafter amortizing any discount or premium from its face value at a constant rate until maturity. B) Security transactions Security transactions are accounted for on the trade date (date the order to buy or sell is executed). C) Federal taxes It is the policy of the fund to distribute all of its taxable income within the prescribed time and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. It is also the intention of the fund to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Internal Revenue Code of 1986. Therefore, no provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held and for excise tax on income and capital gains. D) Interest income and distributions to shareholders Interest is recorded on the accrual basis. Income dividends (and distributions of realized gains, if any) are recorded daily by the fund and are distributed monthly to the shareholders. The amount and character of income and gains to be distributed are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. Note 2 Management fee, administrative services and other transactions Compensation of Putnam Management, for management and investment advisory services is paid quarterly based on the average net assets of the fund. Such fee is based on the following annual rates: 0.50% of the first $100 million of average net assets, 0.40% of the next $100 million, 0.35% of the next $300 million, 0.325% of the next $500 million, and 0.30% of any amount over $1 billion subject, under current law, to reduction in any year by the amount of certain brokerage commissions and fees (less expenses) received by affiliates of Putnam Management on the fund's portfolio transactions. The fund reimburses Putnam Management for the compensation and related expenses of certain officers of the fund and their staff who provide administrative services to the fund. The aggregate amount of all such reimbursements is determined annually by the Trustees. Custodial functions for the fund's assets are provided by Putnam Fiduciary Trust Company (PFTC), a wholly-owned subsidiary of Putnam Investments, Inc. Investor servicing agent functions are provided by Putnam Investor Services, a division of PFTC. For the year ended September 30, 1996, fund expenses were reduced by $800,758 under expense offset arrangements with PFTC. Investor servicing and custodian fees reported in the Statement of operations exclude these credits. The fund could have invested a portion of the assets utilized in connection with the expense offset arrangements in an income producing asset if it had not entered into such arrangements. Trustees of the fund receive an annual Trustees fee of $2,400 and an additional fee for each Trustee's meeting attended. Trustees who are not interested persons of Putnam Management and who serve on committees of the Trustees receive additional fees for attendance at certain committee meetings. The fund adopted a Trustee Fee Deferral Plan (the "Plan") which allows the Trustees to defer the receipt of all or a portion of Trustees Fees payable on or after July 1, 1995. The deferred fees remain in the fund and are invested in certain Putnam funds until distribution in accordance with the Plan. The fund has adopted distribution plans (the "Plans") with respect to its class B shares and class M shares pursuant to Rule 12b-1 under the Investment Company Act of 1940. The purpose of the Plans is to compensate Putnam Mutual Funds Corp., a wholly-owned subsidiary of Putnam Investments Inc., for services provided and expenses incurred by it in distributing shares of the fund. The Plans provide for payments by the fund to Putnam Mutual Funds Corp. at an annual rate up to 0.75% and 1.00% of the average net assets attributable to class B and class M shares, respectively. The Trustees have approved payment by the fund at an annual rate of 0.50% and 0.15% of the average net assets attributable to class B and class M shares, respectively. For the year ended September 30, 1996 Putnam Mutual Funds Corp., acting as underwriter received $1,618,909 in contingent deferred sales charges from redemptions of class B shares. A deferred sales charge of up to 1% is assessed on certain redemptions of class A shares acquired through an exchange from another fund. For the year ended September 30, 1996, Putnam Mutual Funds Corp., acting as underwriter received $52,520 on class A redemptions. Note 3 Purchases and sales of securities During the year ended September 30, 1996, purchases and sales (including maturities) of investment securities (all short-term obligations) aggregated $37,616,544,922 and $37,116,428,828, respectively. In determining the net gain or loss on securities sold, the cost of securities has been determined on the identified cost basis. Note 4 Capital shares At September 30, 1996, there was an unlimited number of shares of beneficial interest authorized. Transactions in capital shares at a constant net asset value of $1.00 per share were as follows: Year ended September 30 - ---------------------------------------------------- Class A 1996 1995 - ---------------------------------------------------- Shares sold 8,637,001,040 4,779,510,741 - ---------------------------------------------------- Shares issued in connection with reinvestment of distributions 67,453,247 54,658,336 - ---------------------------------------------------- 8,704,454,287 4,834,169,077 Shares repurchased (8,234,806,321) (4,745,700,888) - ---------------------------------------------------- Net increase 469,647,966 88,468,189 - ---------------------------------------------------- Year ended September 30 - ---------------------------------------------------- Class B 1996 1995 - ---------------------------------------------------- Shares sold 2,160,995,082 1,012,064,608 - ---------------------------------------------------- Shares issued in connection with reinvestment of distributions 14,670,593 9,599,944 - ---------------------------------------------------- 2,175,665,675 1,021,664,552 Shares repurchased (1,993,883,218) (959,317,895) - ---------------------------------------------------- Net increase 181,782,457 62,346,657 - ---------------------------------------------------- For the period December 8, 1994 (commencement of Year ended operations) to September 30 September 30 - ---------------------------------------------------- Class M 1996 1995 - ---------------------------------------------------- Shares sold 133,711,096 16,449,326 - ---------------------------------------------------- Shares issued in connection with reinvestment of distributions 845,150 109,559 - ---------------------------------------------------- 134,556,246 16,558,885 Shares repurchased (113,921,686) (8,118,436) - ---------------------------------------------------- Net increase 20,634,560 8,440,449 - ---------------------------------------------------- Federal tax information (Unaudited) The Form 1099 you receive in January 1997 will show the tax status of all distributions paid to your account in calendar 1996. Results of September 5, 1996 shareholder meeting (Unaudited) A meeting of shareholders of the fund was held on September 5, 1996. At the meeting, each of the nominees for Trustees was elected, as follows: Votes Votes for withheld --------- -------- Jameson Adkins Baxter 1,171,271,981 15,934,027 Hans H. Estin 1,170,979,001 16,226,008 John A. Hill 1,171,392,250 15,812,758 R.J. Jackson 1,170,025,594 17,179,415 Elizabeth T. Kennan 1,170,968,538 16,236,471 Lawrence J. Lasser 1,171,269,424 15,935,584 Robert E. Patterson 1,171,376,463 15,828,545 Donald S. Perkins 1,171,169,031 16,035,977 William F. Pounds 1,171,052,401 16,152,607 George Putnam 1,170,985,423 16,219,585 George Putnam, III 1,170,692,501 16,512,507 Eli Shapiro 1,169,739,473 17,465,535 A.J.C. Smith 1,171,251,204 15,953,805 W. Nicholas Thorndike 1,170,707,467 16,497,542 A proposal to ratify the selection of Price Waterhouse LLP as auditors for the fund was approved as follows: 1,149,694,018 votes for, and 12,594,894 votes against, with 24,916,096 abstentions and broker non- votes. A proposal to amend the fund's fundamental investment restriction with respect to diversification of investments was approved as follows: 997,134,295 votes for, and 91,388,392 votes against, with 98,682,321 abstentions and broker non-votes. A proposal to amend the fund's fundamental investment restriction with respect to investments in the securities of a single issuer was approved as follows: 983,218,239 votes for, and 107,784,297 votes against, with 96,202,472 abstentions and broker non-votes. A proposal to amend the fund's fundamental investment restriction with respect to making loans was approved as follows: 963,255,979 votes for, and 127,744,898 votes against, with 96,204,131 abstentions and broker non-votes. A proposal to amend the fund's fundamental investment restriction with respect to investments in real estate was approved as follows: 972,971,786 votes for, and 115,126,957 votes against, with 99,106,265 abstentions and broker non-votes. A proposal to amend the fund's fundamental investment restriction with respect to concentration of its assets was approved as follows: 1,017,079,512 votes for, and 68,953,669 votes against, with 101,171,827 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to investments in issuers that have been in operation for less than three years was approved as follows: 974,744,725 votes for, and 116,427,586 votes against, with 96,032,697 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to investments in securities of issuers in which management of the fund or Putnam Investment Management, Inc. owns securities was approved as follows: 967,280,366 votes for, and 120,769,177 votes against, with 99,155,465 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to margin transactions was approved as follows: 943,507,823 votes for, and 144,987,332 votes against, with 98,709,854 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to short sales was approved as follows: 959,938,067 votes for, and 129,998,056 votes against, with 97,268,885 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to pledging was approved as follows: 954,067,954 votes for, and 131,934,188 votes against, with 101,202,866 abstentions and broker non-votes. A proposal to eliminate the fund's fundamental investment restriction with respect to investments in warrants was approved as follows: 958,331,273 votes for, and 126,120,804 votes against, with 102,752,931 abstentions and broker non-votes. All tabulations are rounded to nearest whole number. Fund information INVESTMENT MANAGER Putnam Investment Management, Inc. One Post Office Square Boston, MA 02109 MARKETING SERVICES Putnam Mutual Funds Corp. One Post Office Square Boston, MA 02109 CUSTODIAN Putnam Fiduciary Trust Company LEGAL COUNSEL Ropes & Gray INDEPENDENT ACCOUNTANTS Price Waterhouse LLP TRUSTEES George Putnam, Chairman William F. Pounds, Vice Chairman Jameson Adkins Baxter Hans H. Estin John A. Hill Ronald J. Jackson Elizabeth T. Kennan Lawrence J. Lasser Robert E. Patterson Donald S. Perkins George Putnam, III Eli Shapiro A.J.C. Smith W. Nicholas Thorndike OFFICERS George Putnam President Charles E. Porter Executive Vice President Patricia C. Flaherty Senior Vice President John D. Hughes Senior Vice President and Treasurer Lawrence J. Lasser Vice President Gordon H. Silver Vice President William J. Curtin Vice President William F. McGue Vice President Lindsey C. Strong Vice President and Fund Manager William N. Shiebler Vice President John R. Verani Vice President Paul M. O'Neil Vice President Beverly Marcus Clerk and Assistant Treasurer This report is for the information of shareholders of Putnam Money Market Fund. It may also be used as sales literature when preceded or accompanied by the current prospectus, which gives details of sales charges, investment objectives, and operating policies of the fund, and the most recent copy of Putnam's Quarterly Performance Summary. For more information or to request a prospectus, call toll-free: 1-800-225-1581. You can also learn more at Putnam Investments' website: http://www.putnaminv.com. Shares of mutual funds are not deposits or obligations of, or guaranteed or endorsed by, any financial institution, are not insured by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board or any other agency, and involve risk, including the possible loss of the principal amount invested. PUTNAM INVESTMENTS The Putnam Funds One Post Office Square Boston, Massachusetts 02109 - --------------------- Bulk Rate U.S. Postage PAID Putnam Investments - --------------------- 28362-010/879/534 11/96 -----END PRIVACY-ENHANCED MESSAGE-----