So we just have a much, much larger field force. So that lets us be better partners, both of those things, both the expanded field force, the expanded products. We’re better partners with the Power-related companies, but with all of our insurance partners. And I think that’s what’s really important to mention is this is not just about being stronger with one partner, it’s about being stronger in insurance and retirement across the board. Putnam’s DC assets are about 30% of overall AUM. It’s just a real strength and bringing that DNA into Franklin will be a real benefit. And the relationship with Empower allows us to build some custom products together that we can go to market with that we think will really help us win because we can have multiple sales forces now selling the same products, which just gives us leverage.
Michael Cyprys: Great, thanks. And just a follow-up question on the technology front. Just curious how you’re thinking about front-to-back outsourcing opportunities and evolving the tech stack from here. Maybe you could speak to some of the opportunities that you might see from improving data integration across multiple systems that you have, what sort of factors go into consideration, and any sort of lessons learned you might take away from others that have partnered externally on this front.
Matthew Nicholls: Yeah, thanks. Mike, I’ll take that and then Jenny maybe would like to comment, because we’re all very involved in this — in these very critical decisions for the company. So, as you know, we outsourced transfer agency, fund administration and parts about technology as we’ve described beforehand. We then moved on to understanding the potential opportunity for effectively partnering with one single provider for our investment technology platform. That’s a huge undertaking, a process that takes a year, 18-months just to go through all the analysis. What I’d say on this is the number one point is — and most important to ask candidly, is that all of our specialist investment teams are on board with moving to a single investment technology platform.
We’ve done a huge amount of work, and I’d say that we are close to deciding on who that partner should be. It’s going to be a long time to implement. I wish it was faster, but it’s slower. It’s a very long and complicated process, but it’s probably going to take something like three years to implement. So to give you guides on expense reductions and how it’s going to be applied internally is really premature at this stage. But we are encouraged by what we see and what we think we can achieve from this transaction. But candidly, there’s so many other demands to invest, like, artificial intelligence, data, additional teams and resources that they require to be leading in the industry, that while we expect long-term savings to be meaningful over time, we’ve got a lot of other things to circulate those savings into.
But again, we’ll share that with you when we’re through the process with the partner that we expect to announce here in the coming quarter or two or so. So, that’s sort of the update. I don’t know whether, Jenny, you want to add anything to that.
Jennifer Johnson: No, Matt, that was perfect.
Michael Cyprys: Great. Thanks so much.
Operator: Thank you. The next question comes from Patrick Davitt from Autonomous. Please go ahead.
Patrick Davitt: Hey, good morning, everyone.
Matthew Nicholls: Good morning.
Patrick Davitt: First on Putnam, as we try to kind of level set our model expectations, could you give an update on how the net flow picture tracked from announcement through the December quarter with and without reinvested dividends?
Matthew Nicholls: Yes, excluding reinvested dividends, it’s slightly positive. Now, obviously, we closed the transaction, as you know, Patrick, on January 1, I’d say in the quarter before that and the period we’re in now, it’s kind of flattish excluding reinvested dividends. So slightly positive.
Patrick Davitt: Got it.
Jennifer Johnson: And I’m just going to throw one thing in. I mean, Putnam’s got 85% of their AUM beating their peers in all time periods. 87% of their mutual funds are — or 91% of their mutual funds are rated four-star and five-star ratings. So both on the equity and fixed income, they’ve got phenomenal performance.
Patrick Davitt: Great, thanks. And then one housekeeping item. It wasn’t clear to me earlier when you were talking about this, but the $5.5 billion-ish win from Great-West announced last week. Is that a part of the $25 billion or should we consider it incremental?
Adam Spector: Incremental.
Jennifer Johnson: Yeah. I think that’s from the — yeah, from the retirement channel.
Patrick Davitt: So it is incremental.
Adam Spector: Incremental.
Patrick Davitt: Great. Thank you.
Operator: Thank you. The next question comes from Brian Bedell from Deutsche Bank. Please go ahead.
Brian Bedell: Great, thanks. Good morning. Thanks for taking my questions. I just want one clarification also, I think, I’m not sure who mentioned this, but the alternative was the — I think the $5 billion of private markets, hopefully I wrote this down correctly, $5 billion of private markets, less about a billion of liquid alts. Is that for the quarter just reported or for the current March quarter?
Jennifer Johnson: Well, so BSP — so that the — they closed their fund in this quarter and so you don’t see those flows in last quarter. So we’re talking about in, Matt, what was the date that they closed the 4.7?
Matthew Nicholls: That’s I mean was — like two weeks ago or something like that.
Jennifer Johnson: Anyways. Okay. So — this quarter. So — and just the difference BSP charges when they call capital, so they don’t have catch-up fees like Lexington does.
