SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For quarter ended March 31, 1998
Marsh & McLennan Companies, Inc.
1166 Avenue of the Americas
New York, New York 10036
(212) 345-5000
Commission file number 1-5998
State of Incorporation: Delaware
I.R.S. Employer Identification No. 36-2668272
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X . NO .
As of April 30, 1998, there were outstanding 171,092,684
shares of common stock, par value $1.00 per share, of the
registrant.
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995.
Such statements may include, without limitation, discussions
concerning revenue and expense growth, cost savings and
efficiencies expected from the integration of Johnson & Higgins,
market and industry conditions, interest rates, foreign exchange
rates, contingencies and matters relating to the operations and
income taxes of Marsh & McLennan Companies, Inc. and subsidiaries
(the "Company"). Such forward-looking statements are based on
available current market and industry materials, experts' reports
and opinions, as well as management's expectations concerning
future events impacting the Company. Forward-looking statements by
their very nature involve risks and uncertainties. Factors that
may cause actual results to differ materially from those
contemplated by any forward-looking statements contained herein
include, in the case of the Company's risk and insurance services
business, the failure to successfully integrate the recently
acquired insurance services and employee benefit consulting
business of Johnson & Higgins (including the achievement of
synergies and cost reductions), changes in competitive conditions,
a decrease in the premium rate levels in the global property and
casualty insurance markets, the impact of changes in insurance
markets and natural catastrophes; in the case of the Company's
investment management business, changes in worldwide and national
securities and fixed income markets and; with respect to all of the
Company's activities, changes in general worldwide and national
economic conditions, fluctuations in foreign currencies, actions of
competitors or regulators, changes in interest rates, developments
relating to claims and lawsuits, changes in the tax or accounting
treatment of the Company's operations and the impact of tax and
other legislation and regulation in the jurisdictions in which the
Company operates.
PART I, FINANCIAL INFORMATION
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share figures)
(Unaudited)
Three Months Ended
March 31,
1998 1997
Revenue $1,776 $1,295
Expense 1,372 1,018
Operating Income 404 277
Interest Income 5 3
Interest Expense (28) (17)
Income Before Income Taxes 381 263
Income Taxes 150 99
Net Income $ 231 $ 164
Basic Net Income Per Share $1.35 $1.13
Diluted Net Income Per Share $1.31 $1.10
Average Number of Shares
Outstanding - Basic 171 146
Average Number of Shares
Outstanding - Diluted 176 149
Dividends Declared $.50 $.45
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In millions of dollars)
(Unaudited)
March 31, December 31,
1998 1997
ASSETS
Current assets:
Cash and cash equivalents
(including interest-bearing amounts
of $518 at March 31, 1998 and
$378 at December 31, 1997) $ 567 $ 424
Receivables-
Commissions and fees 1,373 1,296
Advanced premiums and claims 118 95
Other receivables 169 160
1,660 1,551
Less-allowance for doubtful accounts (54) (53)
Net receivables 1,606 1,498
Other current assets 606 647
Total current assets 2,779 2,569
Long-term securities 869 720
Fixed assets, net 940 957
(net of accumulated depreciation and
amortization of $808 at March 31, 1998
and $798 at December 31, 1997)
Intangible assets 2,514 2,417
Other assets 1,242 1,251
$8,344 $7,914
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In millions of dollars)
(Unaudited)
March 31, December 31,
1998 1997
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt $ 503 $ 237
Accrued compensation and employee benefits 352 564
Accounts payable and accrued liabilities 1,269 1,276
Accrued income taxes 326 218
Dividends payable 86 85
Total current liabilities 2,536 2,380
Fiduciary liabilities 2,599 2,282
Less - cash and investments held in
a fiduciary capacity (2,599) (2,282)
- -
Long-term debt 1,163 1,240
Other liabilities 1,138 1,096
Commitments and contingencies - -
Stockholders' equity:
Preferred stock, $1 par value, authorized
6,000,000 shares, none issued - -
Common stock, $1 par value, authorized
400,000,000 shares, issued 172,427,758
shares at March 31, 1998 and 172,391,177
at December 31, 1997 172 172
Additional paid-in capital 1,007 994
Retained earnings 2,121 1,975
Accumulated other comprehensive income 268 167
3,568 3,308
Less - treasury shares, at cost,
1,237,951 shares at March 31, 1998 and
2,440,837 shares at December 31, 1997 (61) (110)
Total stockholders' equity 3,507 3,198
$8,344 $7,914
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of dollars)
(Unaudited)
Three Months Ended
March 31,
1998 1997
Operating cash flows:
Net income $231 $164
Depreciation and amortization 56 37
Deferred income taxes (5) 1
Other liabilities 41 (7)
Prepaid dealer commissions (29) (61)
Other, net (7) 3
Net changes in operating working capital
other than cash and cash equivalents -
Receivables (108) (20)
Other current assets 39 (2)
Accrued compensation and employee benefits (211) (174)
Accounts payable and accrued liabilities (6) 16
Accrued income taxes 119 (14)
Effect of exchange rate changes 27 (7)
Net cash generated from
(used for) operations 147 (64)
Financing cash flows:
Net increase in commercial paper 272 505
Other borrowings 9 400
Other repayments (81) (121)
Purchase of treasury shares (2) -
Issuance of common stock 45 55
Dividends paid (85) (65)
Net cash provided by
financing activities 158 774
Investing cash flows:
Additions to fixed assets (60) (51)
Acquisitions (112) (375)
Other, net 13 13
Net cash used for investing activities (159) (413)
Effect of exchange rate changes on cash
and cash equivalents (3) (5)
Increase in cash & cash equivalents 143 292
Cash & cash equivalents at beginning of period 424 300
Cash & cash equivalents at end of period $567 $592
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The consolidated financial statements included herein have
been prepared by the Company pursuant to the rules and
regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to
such rules and regulations, although the Company believes that
the disclosures are adequate to make the information presented
not misleading. These consolidated financial statements
should be read in conjunction with the financial statements
and the notes thereto included in the Company's latest annual
report on Form 10-K.
The financial information contained herein reflects all
adjustments which are, in the opinion of management, necessary
for a fair presentation of the results of operations for the
three month periods ended March 31, 1998 and 1997.
2. Fiduciary Cash and Liabilities
In its capacity as an insurance broker or agent, the Company
collects premiums from insureds and, after deducting its
commissions, remits the premiums to the respective insurance
underwriters; the Company also collects claims or refunds from
underwriters on behalf of insureds. Unremitted insurance
premiums and claims are held in a fiduciary capacity.
Interest income on these fiduciary funds, included in revenue,
amounted to $30 million and $23 million for the three months
ended March 31, 1998 and 1997, respectively.
Net uncollected premiums and claims and the related payables
amounting to $5.9 billion at March 31, 1998 and $5.2 billion
at December 31, 1997, are not included in the accompanying
Consolidated Balance Sheets.
3. Per Share Data
In 1997, the Company adopted Statement of Financial Accounting
Standards No. 128, "Earnings Per Share" which requires the
Company to include basic and diluted per share figures on the
face of the income statement.
Basic net income per share is calculated by dividing net
income by the average number of shares of the Company's common
stock outstanding while diluted net income per share is
calculated by adjusting the average common shares outstanding
for the dilutive effect of potential common shares.
The following reconciles basic weighted average common shares
outstanding to diluted weighted average common shares
outstanding for the three-month periods ended March 31, 1998
and 1997.
(In millions of shares)
1998 1997
Basic weighted average
common shares outstanding 171 146
Stock options 5 3
Diluted weighted average
common shares outstanding 176 149
4. Comprehensive Income
Effective January 1, 1998, the Company adopted Statement of
Financial Accounting Standards No. 130 ("SFAS 130"),
"Reporting Comprehensive Income." SFAS 130 establishes
standards for reporting and displaying comprehensive income
and its components. Comprehensive income, which is made up of
net income, unrealized securities holding gains and foreign
currency translation adjustments amounted to $332 million and
$115 million for the three months ended March 31, 1998 and
1997. The difference between net income and comprehensive
income for the quarter ended March 31, 1998 was primarily due
to unrealized securities holding gains while the difference
for the period ended March 31, 1997 was primarily due to
foreign currency translation adjustments.
5. Supplemental Disclosure to the Consolidated Statements
of Cash Flows
The following schedule provides additional information
concerning acquisitions:
Three Months Ended
March 31,
(In millions of dollars) 1998 1997
Purchase acquisitions:
Assets acquired, excluding cash $112 $ 2,536
Liabilities assumed - (1,156)
Shares issued - (1,005)
Net cash outflow for acquisitions $112 $ 375
Interest paid during the three months ended March 31, 1998 and
1997 was $33 million and $16 million, respectively.
Income taxes paid during the three months ended March 31, 1998
and 1997 were $41 million and $98 million, respectively.
6. Income Taxes
The Company has received a Notice of Proposed Adjustment from
a field office of the Internal Revenue Service ("IRS")
challenging its tax treatment related to 12b-1 fees paid by
the Putnam Mutual Funds. The Company believes its tax
treatment of these fees is consistent with current industry
practice and applicable requirements of the Internal Revenue
Code and previously issued IRS technical advice. The field
office has referred the Notice to the national office of the
IRS for technical advice.
Taxing authorities periodically challenge positions taken by
the Company on its tax returns. On the basis of present
information and advice received from counsel, it is the
opinion of the Company's management that any assessments
resulting from current tax audits will not have a material
adverse effect on the Company's consolidated results of
operations or its consolidated financial position.
7. Acquisitions
On March 24, 1998, the Company purchased Brockman y Schuh
Group, a risk and insurance services and employee benefit
consulting firm in Mexico, for approximately $100 million.
On March 27, 1997, the Company consummated a business
combination with Johnson & Higgins ("J&H"), a privately-held
risk and insurance services and employee benefit consulting
firm. The Company agreed to pay total consideration of
approximately $1.8 billion consisting of $600 million in cash
and approximately 19.6 million shares (adjusted to reflect the
stock split) of the Company's common stock. Approximately
$1.3 billion was paid at closing or shortly thereafter and
approximately $500 million will be paid in annual installments
over the four years following the closing. The business
combination is being accounted for using the purchase method
of accounting. Accordingly, the goodwill of approximately
$1.7 billion which results from the purchase price allocation
will be amortized over 40 years.
An agreed number of shares issued in connection with this
transaction carry restrictions and, consequently, cannot be
sold in the first and second years following the closing. In
addition, approximately 1.6 million shares of common stock
(adjusted to reflect the stock split) were placed in escrow
for a period of up to two years in order to secure certain
indemnification obligations with respect to representations
and warranties.
The following unaudited pro forma summary presents the
consolidated results of operations of the Company as if the
J&H business combination had occurred on January 1, 1997. The
pro forma results are shown for illustrative purposes only and
do not purport to be indicative of the results which would
have been reported if the business combination had occurred on
the date indicated or which may occur in the future.
(In millions of dollars, except per share figures)
Three Months Ended
March 31, 1997
Revenue $1,609
Net Income 179
Basic Net Income per share 1.08
Diluted Net Income per share 1.06
8. Claims, Lawsuits and Other Contingencies
The Company and its subsidiaries are subject to various claims
and lawsuits consisting principally of alleged errors and
omissions in connection with the placement of insurance or
reinsurance and in rendering investment and consulting
services. Some of these claims and lawsuits seek damages,
including punitive damages, in amounts which could, if
assessed, be significant.
On November 24, 1997, an action captioned "Aiena et al. vs.
Olsen et al" was brought in the United States District Court
for the Southern District of New York by certain former
directors of J&H, which was acquired by the Company in March
1997, against twenty-four selling shareholders of J&H, as well
as J&H itself and the Company. The action essentially
challenges the allocation of the consideration paid in
connection with the Company's combination with J&H as between
the defendants who were directors and shareholders of J&H at
the time of the transaction and the plaintiffs who were former
directors and shareholders of J&H. The Complaint asserts,
among others, claims for breach of fiduciary duty, federal
securities law violations, breach of contract, and ERISA
violations. Plaintiffs seek compensatory and punitive
damages.
On or about April 14, 1998, an action captioned "Sempier v.
Olsen, et al" was brought in the United States District Court
for the District of New Jersey by another former director of
J&H against the same defendants named in the Aiena action,
including J&H and the Company, in connection with the same
transaction. The allegations and claims in the Sempier case
are substantially similar to those in the Aiena action.
Plaintiff seeks, among other relief, an unspecified amount of
compensatory and punitive damages.
On the basis of present information, available insurance
coverage and advice received from counsel, it is the opinion
of the Company's management that the disposition or ultimate
determination of these claims and lawsuits will not have a
material adverse effect on the Company's consolidated results
of operations or its consolidated financial position.
9. Common Stock
On May 21, 1997, the Board of Directors approved a two-for-one
stock split of the Company's common stock in the form of a
100% stock distribution which was issued on June 27, 1997.
All references to per share amounts have been restated for
this stock distribution.
10. New Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board
("FASB") issued Statement of Financial Accounting Standards
No. 131, "Disclosures about Segments of an Enterprise and
Related Information," and in February 1998, the FASB issued
Statement of Financial Accounting Standards No. 132,
"Employers' Disclosure about Pensions and Other Postretirement
Benefits." Both statements are effective for fiscal years
beginning after December 15, 1997. The Company will adopt the
provisions of these standards in conjunction with the
preparation of the 1998 Annual Report.
11. Reclassifications
In accordance with industry practice, the investment
management segment has restated both revenue and expense for
1997 by identical amounts to reclassify certain commission
expenses.
Marsh & McLennan Companies, Inc. and Subsidiaries
Management's Discussion and Analysis of
Financial Condition and Results of Operations
First Quarter Ended March 31, 1998
General
Marsh & McLennan Companies, Inc. and Subsidiaries (the "Company")
is a professional services firm providing risk and insurance
services, investment management and consulting. More than 36,000
employees worldwide provide analysis, advice and transactional
capabilities to clients in over 100 countries.
This management's discussion and analysis of financial condition
and results of operations contains certain statements relating to
future results which are forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995.
See "Information Concerning Forward-Looking Statements" on page one
of this filing. This Form 10-Q should be read in conjunction with
the Company's latest annual report on Form 10-K.
The consolidated results of operations follow:
(In millions of dollars) 1998 1997
Revenue:
Risk and Insurance Services $ 870 $ 563
Investment Management 558 427
Consulting 348 305
1,776 1,295
Expense:
Compensation and Benefits 851 627
Other Operating Expenses 521 391
1,372 1,018
Operating Income $ 404 $ 277
Operating Income Margin 22.7% 21.4%
Revenue, derived mainly from commissions and fees, rose 37% from
the first quarter of 1997. This increase is partly attributable to
the Company's business combination with Johnson & Higgins ("J&H")
which closed on March 27, 1997 and, accordingly, was not reflected
in the consolidated results of operations for the first quarter of
1997. Excluding acquisitions and dispositions, revenue grew
approximately 13% for the first quarter of 1998 driven principally
by increased revenue from the investment management segment, which
was largely attributable to higher assets under management.
Operating expenses rose 35% in the first quarter of 1998 primarily
due to the combination with J&H. Excluding acquisitions and
dispositions, expenses grew 9% for the first quarter due, in large
measure, to costs associated with staff growth and higher incentive
compensation levels in the investment management segment
commensurate with strong operating performance. Service related
costs in this segment also increased due to the higher level of
business activity.
The translated values of revenue and expense from the Company's
international operations are affected by fluctuations in currency
exchange rates. However, the net impact of these fluctuations on
the Company's results of operations has not been material.
Risk and Insurance Services
(In millions of dollars) 1998 1997
Revenue $870 $563
Expense 637 405
Operating Income $233 $158
Operating Income Margin 26.8% 28.0%
Revenue
Revenue for the Risk and Insurance Services segment increased 55%
from the first quarter of 1997 primarily due to the J&H business
combination. Excluding acquisitions and dispositions, revenue
increased approximately 5%. Insurance broking revenue, which
represented 76% of Risk and Insurance Services, grew 5% in the
first quarter of 1998 as net new business development was partially
offset by continued declines in commercial property and casualty
premium rates. Revenue for reinsurance broking grew 7% over the
first quarter of 1997 and program management rose 4% while
fiduciary interest income declined 2%.
Expense
Risk and Insurance Services expenses increased 57% from the first
quarter of 1997 primarily due to the impact of acquisitions.
Excluding acquisitions and dispositions, expenses increased
approximately 2% from the first quarter of 1997. During the
quarter, the Company realized integration savings associated with
the elimination of redundant personnel and the consolidation of
offices, primarily in the United States.
Investment Management
(In millions of dollars) 1998 1997
Revenue $558 $427
Expense 406 323
Operating Income $152 $104
Operating Income Margin 27.2% 24.3%
Revenue
Putnam's revenue increased 31% compared with the first quarter of
1997 reflecting exceptional growth in the level of assets under
management on which management fees are earned. Net new sales of
mutual funds and additional investments by institutional accounts
contributed $33 billion of the growth in the level of assets under
management since March 1997, while market performance represented
the remaining $54 billion of the increase.
Expense
Putnam's expenses rose 26% in the first quarter of 1998 reflecting
the effect of staff growth to support new business and incentive
compensation levels commensurate with strong operating performance
along with increased service related costs resulting from the
higher level of business activity.
Quarter-end and average assets under management for the first
quarter are presented below:
(In billions of dollars) 1998 1997
Mutual Funds:
Domestic Equity $138 $ 84
Taxable Bond 38 31
Tax-Free Income 16 16
International Equity 13 9
205 140
Institutional Accounts:
Fixed Income 23 19
Domestic Equity 26 14
International Equity 13 7
62 40
Quarter-end Assets $267 $180
Average Assets $249 $182
Assets under management are affected by fluctuations in domestic
and international bond and stock market prices and by the level of
investments and withdrawals for current and new fund shareholders
and clients. They are also affected by investment performance,
service to clients, the development and marketing of new investment
products, the relative attractiveness of the investment style under
prevailing market conditions and changes in the investment patterns
of clients. Revenue levels are sensitive to all of the factors
above, but in particular, to significant changes in bond and stock
market valuations.
Putnam provides individual and institutional investors with a broad
range of equity and fixed income investment products and services
designed to meet varying investment objectives and which affords
its clients the opportunity to allocate their investment resources
among various alternative investment products as changing worldwide
economic and market conditions warrant. At the end of the first
quarter, assets held in equity securities represented 71% of assets
under management, compared with 64% in 1997, while investments in
fixed income products represented 29%, compared with 36% last year.
Consulting
(In millions of dollars) 1998 1997
Revenue $348 $305
Expense 315 277
Operating Income $ 33 $ 28
Operating Income Margin 9.6% 9.3%
Revenue
Consulting revenue increased 14% in 1998 compared with the first
quarter of 1997 reflecting net new business as well as some
business acquired as part of the J&H transaction partially offset
by the transfer of certain business lines as part of a strategic
alliance with Automatic Data Processing. Adjusting for the impact
of acquisitions and dispositions, revenue increased approximately
10% in the first quarter of 1998. Retirement consulting revenue,
which represented 43% of the consulting segment, grew 10% in the
first quarter while revenue rose 22% in the global compensation
practice and 9% in general management consulting due to a higher
volume of business in these practice lines during the first quarter
of 1998. Economic consulting and health care consulting grew 9%
and 2%, respectively.
Expense
Consulting expenses increased 14% for the first quarter of 1998.
Excluding acquisitions and dispositions, expenses increased 9% for
the first quarter reflecting normal salary and related benefit
expense increases.
Interest
Interest income earned on corporate funds increased to $5 million
in the first quarter of 1998 compared with $3 million in 1997
primarily due to the J&H combination. Interest expense increased
to $28 million in the first quarter of 1998 from $17 million in
1997 as a result of increased bank borrowings used to finance a
portion of the acquisition of J&H as well as the assumption of
J&H's long-term debt.
Income Taxes
The Company's consolidated tax rate was 39.5% of income before
income taxes in the first quarter of 1998 compared with 37.5% for
the first quarter of 1997. The increase in the 1998 tax rate is
largely attributable to the nondeductibility of the goodwill
amortization associated with the J&H acquisition. The overall tax
rates are higher than the U.S. statutory rates primarily because of
state and local income taxes.
Liquidity and Capital Resources
The Company's cash and cash equivalents aggregated $567 million on
March 31, 1998, compared with $424 million on December 31, 1997.
Cash flow from operations includes the net cash requirements of
Putnam's prepaid dealer commissions, which amounted to $29 million
for the three months ended March 31, 1998 compared with $61 million
during the same period of 1997.
The Company's capital expenditures, which amounted to $60 million
in the first three months of 1998 and $51 million in the first
quarter of 1997, were primarily related to computer equipment
purchases and the refurbishing and modernizing of office
facilities.
The Company is continuing to update its computer systems in
preparation for the year 2000 and expects that its critical systems
will be year 2000 compliant on a timely basis. The costs
associated with addressing this issue are not expected to have a
material adverse impact on the Company's financial position or
results of operations. However, if the Company's clients or
vendors are unable to resolve such year 2000 processing issues in
a timely manner, a material operating and financial risk could
result.
Effective January 1, 1998, the Company adopted Statement of
Financial Accounting Standards No. 130 ("SFAS 130"), "Reporting
Comprehensive Income." SFAS 130 establishes standards for
reporting and displaying comprehensive income and its components.
Comprehensive income, which is made up of net income, unrealized
securities holding gains and foreign currency translation
adjustments amounted to $332 million and $115 million for the three
months ended March 31, 1998 and 1997. The difference between net
income and comprehensive income for the quarter ended March 31,
1998 was primarily due to unrealized securities holding gains while
the difference for the period ended March 31, 1997 was primarily
due to foreign currency translation adjustments.
In June 1997, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards No. 131,
"Disclosures about Segments of an Enterprise and Related
Information," and in February 1998, the FASB issued Statement of
Financial Accounting Standards No. 132, "Employers' Disclosure
about Pensions and Other Postretirement Benefits." Both statements
are effective for fiscal years beginning after December 15, 1997.
The Company will adopt the provisions of these standards in
conjunction with the preparation of the 1998 Annual Report.
The other liabilities in the Consolidated Balance Sheets, which
totaled $1.1 billion on March 31, 1998 and December 31, 1997,
include the Company's long-term pension liability, reserves related
to the Company's professional liability insurance program, and the
postretirement liability for certain health care and life insurance
benefits.
PART II, OTHER INFORMATION
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
INFORMATION REQUIRED FOR FORM 10-Q QUARTERLY REPORT
MARCH 31, 1998
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
27. Financial Data Schedule
(b) Reports on Form 8-K.
None.
MARSH & McLENNAN COMPANIES, INC.
AND SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed this
14th day of May, 1998 on its behalf by the undersigned, thereunto
duly authorized and in the capacity indicated.
MARSH & McLENNAN COMPANIES, INC.
/s/ Frank J. Borelli
Senior Vice President and
Chief Financial Officer
<TABLE> <S> <C>
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<LEGEND>
This schedule contains summary financial information extracted from the
consolidated Marsh & McLennan Companies, Inc. and subsidiaries March 31,
1998 financial statements and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
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<PERIOD-END> MAR-31-1998
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