Marsh & McLennan's first-quarter profit beats on higher fiduciary interest income

(Reuters) - Marsh & McLennan reported a better-than-expected quarterly profit on Thursday, helped by an increase in interest income the insurance brokerage earned from funds held on behalf of clients.

The company's shares rose about 2% to $201 before the bell.

The U.S. Federal Reserve's higher-for-longer interest rate environment has helped such companies rake in higher income on funds they hold in a fiduciary capacity, that is, on behalf of clients.

Marsh & McLennan's fiduciary interest income rose 34% to $122 million in the first quarter.

The New York-based company's revenue streams are diversified across insurance brokerage, consulting, reinsurance brokerage, talent management and investment management services.

Revenue from the company's risk and insurance services business rose 9% to $4.27 billion in the first quarter. The unit accounts for most of Marsh & McLennan's revenue.

On an adjusted basis, the company earned $2.89 per share, beating estimates of $2.80 per share, according to LSEG data.

Marsh & McLennan reported total revenue of $6.47 billion, ahead of estimates of $6.39 billion.

Insurance bellwether Travelers Companies missed first-quarter profit estimates on Wednesday as severe storms in the United States drove up its catastrophe losses.

(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Shounak Dasgupta)