1. 0 Barclays Global Investors & Other ETF Sponsors What is an Exchange Traded Fund? ETF Structure and Mechanics

2. 1 Who is Barclays Global Investors? Introduced the world’s first index strategy in 1971 Manages over 2,000 funds which track over 250 indexes around the world Over 2,200 clients in over 39 countries Introduced first quantitative active equity strategy in 1979 Second largest risk controlled manager in US Largest manager of indexed investment products in the world * 41% of the world’s 100 largest pension plans ** 49% of the Forbes Multinational companies † Manages over $761 billion in assets for institutional and individual investors †† Manages 81 of 108 (75%) US ETFs BGI-001 *Pension and Investments, March 2002. **Pension and Investments, September 2001. † Forbes July 2001. ††As of 10/02.

3. 2 ETFs are a fast-growing indexed investment vehicle ETF-004 Index Estimate AUM $B (7/3/03)ETF 2 indexes0.09Fortune Wilshire1.8Viper S&P, 9 indexes4.8Sector SPDRs 8 indexes0.3StreetTracks DJIA5.7Diamonds S&P 4004.9MidCap SPDRS NASDAQ 10020.4NASDAQ 100 80 indexes39.7iShares S&P 50040.7SPDRs Source: American Stock Exchange; BGI.

4. 3 ETFs are a fast-growing indexed investment vehicle ETF-005 Total US ETF AUM (6/30/03)

5. 4 What’s innovative about iShares... iShares are ’40 Act Index Funds… …that trade like stocks iShares have market makers… …addressing discounts & premiums to NAV iShares access underlying market liquidity …trading volume does not equal liquidity iShares in-kind transfers… …enable tax advantages Feat-003 Mutual funds and iShares are obliged to distribute portfolio gains to shareholders at year-end. Your own iShares trading will also generate tax consequences and transaction expenses. Certain traditional mutual funds, such as municipal bond funds, can be tax-efficient as well. Although BGI believes that market makers will take advantage of differences between the NAV and the trading price of iShares through arbitrage opportunities, BGI cannot guarantee that they will do so.

6. 5 99 106 78 68 59 75 45 Avg. index fund (bps) 20 iShares S&P 600 20 iShares Russell 2000 18-20167Small Blend 20 iShares S&P 400 20 iShares Russell Midcap 20155Mid Cap Blend 60 iShares DJ28-60181Sector 84 iShares MSCI International Series 50-65 iShares S&P Regional 35 iShares EAFE 35-99192Foreign Equity ETF (bps) Avg. ETF (bps) Avg. active fund (bps) Fund category 20 iShares Russell 1000 Value 18 iShares S&P/BARRA Value 18-20145Large Value 9.45 iShares S&P 5009.45-20146Large Blend 15 iShares Lehman Series iShares GS $ Investop Corporate 15110 US Taxable Bond Lower expense ratios Cost-001 The annual management fees of iShares may be substantially less than those of most mutual funds. iShares transactions will result in brokerage commissions, but the savings from lower annual fees can help offset these costs. Source: Morningstar, BGI Analysis, 5/03.

7. 6 Investor (buyer) Cash Shares of fund Traditional US mutual fund Capital markets Cash Securities Customer service Fund ETFs’ in-kind transfer enables tax efficiencies vs. traditional funds Tax efficiency Crea-001 Mutual funds and iShares are obliged to distribute portfolio gains to shareholders by year-end. These gains may be generated due to index rebalancing or to meet diversification requirements. Your own iShares trading, too, will generate tax consequences and transaction expenses. Certain traditional mutual funds can be tax efficient as well.

8. 7 ETF creation & redemption Mutual funds and iShares are obliged to distribute portfolio gains to shareholders by year-end. These gains may be generated due to index rebalancing or to meet diversification requirements. Your own iShares trading, too, will generate tax consequences and transaction expenses. Certain traditional mutual funds can be tax efficient as well. Exchange Traded Funds ETF Fund Advisor Investor (buyer) Brokerage Account Capital Markets ETF SharesSecurities ETF Creation Units Basket of securities Cash Exchange ETF Market Makers Crea-003

9. 8 Regional Australia Energy Topix150 Austria Europe 350 Latin America 40 Belgium Healthcare EMUEAFE Technology Telecommunication Broad-based Developed Markets Pacific ex-Japan S&P Global 100 Canada France Germany Japan Hong Kong Italy Netherlands Switzerland Singapore Spain Sweden Global Sectors Emerging Markets South Africa Brazil Malaysia Mexico South Korea United Kingdom Financial Taiwan S&P Global Index Series MSCI Index Series EMF Current International iShares Line-up Modu-020

10. 9 iShares domestic fund breadth iShares Domestic Funds CapitalizationStyleSectorIndustry Large Cap Mid Cap Small Cap Broad Cap Growth Value Core Technology Financial Healthcare Energy Consumer cyclical Basic materials Industrial Consumer non-cyclical Telecommunications Utilities REIT Biotech Financial services Modu-003 Based on indexes from S&P Frank Russell Dow Jones MSCI Nasdaq Goldman Sachs Lehman Fixed Income 1-3 year 7-10 year 20+ year Investment Grade Corporate

11. 10 Disclosure The iShares that are registered with the United States Securities and Exchange Commission as iShares, Inc. and iShares Trust (the “US iShares”) are distributed by SEI Investments Distribution Co. (SEI). Barclays Global Fund Advisors (BGFA) serves as an advisor to iShares. Barclays Global Investors Services (BGIS) assists in the marketing of iShares. BGFA and BGIS are subsidiaries of Barclays Global Investors, N.A., none of which are affiliated with SEI. For complete information, including charges and expenses, request a prospectus by calling 1-800-iShares (1-800-474-2737). Read it carefully before you invest. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than the original cost. Past performance does not guarantee future results. iShares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Performance is calculated at NAV. Brokerage commissions will reduce returns. There are risks involved with investing, including possible loss of principal. In addition to the normal risks associated with equity investing, narrowly focused investments, such as single countries, sectors and small companies, typically exhibit higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency vales, from differences in generally accepted accounting principles or from economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors, in addition to those associated with their relatively small size and lesser liquidity. REIT investments include illiquidity and interest rate risk. Products of companies in which technology funds invest may be subject to severe competition and rapid obsolescence. Disc-001