Rating agencies set a negative outlook while leaving Marsh &McLennan's credit rating unchanged after news of its $3.9 billionsale of Putnam to Great-West Lifeco Inc. of Canada, but stillquestioned the company's future earnings.

Moody's Investors Service, Standard & Poor's and FitchRatings affirmed their rating of the New York-based professionalservice firm, the parent company of insurance broker Marsh. Allthree placed a negative outlook on the firm.

"The ratings on MMC are based on the company's strong, thoughdiminished, competitive position, led by Marsh," said S&P.

"Fitch believes that the sale of Putnam will free MMC'smanagement from the distraction of running an underperforming,ancillary business that shares little synergy with remainingbusinesses," Fitch said.

"MMC will protect its financial flexibility through the saleprocess and through the subsequent allocation of proceeds," saidMoody's.

The negative outlook reflected the feeling among the three thatMMC still needs to improve earnings, and though improving, thecompany still shows some weakness.

In an analyst's note, David Small with Bear Stearns said thefeeling is that the dilution to earnings will be greater than the 5cents a share management said it would be, but a share repurchaseplan should make the stock more attractive.

"The open question remains how much management wants to reinvestin the business via acquisitions vs. returning capital toshareholders," Mr. Small said.

Fitch and S&P rated MMC's debt at "triple-B." Moody's gavethe company a rating of "Baa2."

All three also affirmed the rating of Great-West Lifeco. Thecompany is a subsidiary of Power Financial Corp. of Canada.