iShares(R) Funds is releasing information at this time to serve the best interests of the shareholders, by assisting them in evaluating the impact of capital gains on their tax liability. While final results of each Fund's capital gains distributions will be made public in December 2004, it is expected that the following Funds will incur no capital gains distributions for 2004.

Please be advised that these are preliminary results only and could be subject to revisions, which may result in distributions. This release is based on preliminary calculations and is subject to change, due to changes in the number of outstanding shares and certain tax adjustments that may effect this calculation.

The iShares(R) Funds are investment companies that issue shares that are bought and sold like common stocks on securities exchanges. The iShares Funds are attractive to many individual and institutional investors and financial intermediaries because of their relative low cost, tax efficiency and trading flexibility. Investors can purchase and sell shares through any brokerage firm, financial advisor, or online broker, and hold the funds in any type of brokerage account. To determine if the fund(s) are an appropriate investment for you, carefully consider the funds' investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the funds' prospectuses, which may be obtained by calling 1-800-iShares or by visiting www.ishares.com. Read the prospectus carefully before investing.

Barclays Global Investors is one of the world's largest asset managers(1) providing structured investment strategies such as risk-controlled active strategies and indexing. In the U.S., BGI is one of the largest active managers(2), set apart by its risk-controlled approach. BGI managed over U.S. $1.1 trillion in assets as of 6/30/04, and over 2,300 funds for more than 2,500 clients in 47 countries around the world. BGI is an innovator in investment management, applying science and technology to the investment process. BGI is owned by Barclays PLC.

All registered investment companies, including the iShares Funds, are obliged to distribute portfolio gains to shareholders at year-end regardless of performance. Trading iShares Funds will also generate tax consequences and transaction expenses. The information provided is not intended to be tax advice. Tax consequences of dividend distributions may vary by individual taxpayer.

To receive the distribution, you must be a registered shareholder of the fund on the record date. Distributions are paid to shareholders on the payment date. Past distributions are not indicative of future distributions.

The attached represents an estimate of distributions per share. This estimate does not take into account any possible tax reclassifications, nor does this estimate contemplate changes in income or shares outstanding that may occur prior to record date. This estimate is for informational purposes only. Please consult your tax professional or financial adviser for more information regarding your tax situation.

To determine if the fund(s) are an appropriate investment for you, carefully consider the funds' investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the funds' prospectuses, which may be obtained by calling 1-800-iShares (1-800-474-2737) or by visiting www.ishares.com. Read the prospectus carefully before investing.

There are risks involved with investing, including possible loss of principal.

The iShares Funds ("Funds") are distributed by SEI Investments Distribution Co. (SEI). Barclays Global Fund Advisors (BGFA) serves as an advisor to the Funds. Barclays Global Investors Services (BGIS) assists in the marketing of the Funds. BGFA and BGIS are subsidiaries of Barclays Global Investors, N.A., which is a wholly owned subsidiary of Barclays Bank PLC, none of which is affiliated with SEI.

The iShares Funds are not sponsored, endorsed, or issued by Goldman Sachs & Co. or Lehman Brothers, nor are they sponsored, endorsed, issued, sold or promoted by Cohen & Steers Capital Management, Inc., Dow Jones & Company, Inc., FTSE/Xinhua Index Limited ("FXI"), Morgan Stanley Capital International, Morningstar Inc., The NASDAQ Stock Market, Inc., New York Stock Exchange, Inc., Frank Russell Company, or Standard and Poor's. None of these companies make any representation regarding the advisability of investing in the Funds. Neither SEI nor BGI, nor any of their affiliates, are affiliated with the companies listed above.

FXI does not make any warranty regarding the FTSE/Xinhua Index. All rights in the index vest in FXI. "FTSE" is a trade and service mark of London Stock Exchange and The Financial Times; "Xinhua" is a trade and service mark of Xinhua Financial Network Limited. "$ InvesTop(TM)", "$ InvesTop(TM) Index", "GS $ Investment Grade Index(TM)" and "Goldman Sachs(R)" are trademarks of Goldman, Sachs & Co.

(C) 2004 Barclays Global Investors. All rights reserved. iShares(R) is a registered trademark of Barclays Global Investors, N.A. All other trademarks, servicemarks or registered trademarks are the property of their respective owners.

(1) Source: "P&I/Watson Wyatt Mega Managers," Pensions & Investments, September 1, 2003.

(2) Source: "Special Report: Money Manager Directory," Pensions & Investments, May 26, 2003.