TO:	Bob Berkopec

FROM:	Kathy Huegel

DATE:	August 26, 1998

SUBJ:	Barclays Securities Lending Program

Further review of Barclays Securities Lending Program has convinced me that The Bradley Foundation should not participate in this particular program.

In order to be eligible to lend securities, the foundation would have to sell out of Barclays Equity Index Fund B (non-lendable) and buy into their Equity Index Fund B (lendable). These two funds contain basically the same stocks, are managed by the same people and have similar returns. This transaction would allow the new fund to add additional income of approximately .5 of a basis point (or .005%) per year.

However, on a $43,000,000 investment, this would result in an increase of only $2,150 per year. In addition, the foundation would incur capital gains of approximately $160,000 on the non-lendable fund's appreciation of $8,000,000. And, the lendable fund contains risks (though minimal) that are not present in the non-lendable fund.

According to Barclays, most organizations are not switching over to the lendable funds due to the capital gain issue. This is especially true with such a low revenue potential. Should the revenue opportunities increase (some international stocks are currently earning 7 to 10 basis points) this issue can always be revisited.