PRICE T ROWE INTERNATIONAL FUNDS INC
485APOS, 1995-03-01
Previous: UNITED CASH MANAGEMENT INC, N-30D, 1995-03-01
Next: HANCOCK JOHN CASH RESERVE INC, NSAR-B/A, 1995-03-01









          PAGE 1
                                       Registration Nos. 002-65539/811-2958

                          SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C. 20549

                                      FORM N-1A

          REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933    / X /

               Post-Effective Amendment No. 54                       / X /

          REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF
          1940                                                       / X /

               Amendment No. 48                                      / X /

                         Fiscal Year Ended December 31, 1994
                      __________________________________________

                       T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                 ____________________________________________________
                  (Exact Name of Registrant as Specified in Charter)

               100 East Pratt Street, Baltimore, Maryland     21202
               __________________________________________   __________
               (Address of Principal Executive Offices)     (Zip Code)

          Registrant's Telephone Number, Including Area Code   410-547-2000
                                                               ____________

                                   Henry H. Hopkins
                                100 East Pratt Street
                              Baltimore, Maryland 21202
                       _______________________________________
                       (Name and Address of Agent for Service)

          Approximate Date of Proposed Public Offering    May 1, 1995
                                                          ____________

               It is proposed that this filing will become effective (check
          appropriate box):

               / /  immediately upon filing pursuant to paragraph (b)

               / /  on (date) pursuant to paragraph (b)

               /X/  60 days after filing pursuant to paragraph (a)(i)


















          PAGE 2
               / /  on (date) pursuant to paragraph (a)(i)

               / /  75 days after filing pursuant to paragraph (a)(ii)  

               / /  on (date) pursuant to paragraph (a)(ii) of Rule 485

               If appropriate, check the following box:

               / /  this post-effective amendment designates a new 
                    effective date for a previously filed post-effective 
                    amendment.

          CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933+
          ______________________________________________
          Pursuant to Section 24f-2 of the Investment Company Act of 1940,
          the Registrant has registered an indefinite number of securities
          under the Securities Act of 1933 and intends to file a 24f-2
          Notice by February 28, 1996.

          +Not applicable, as no securities are being registered by this
          Post-Effective Amendment No. 54 to the Registration Statement.












































          PAGE 3
               The Registration Statement of the T. Rowe Price
          International Funds, Inc. on Form N-1A (File No. 2-65539) is
          hereby amended under the Securities Act of 1933 to update the
          Registrant's financial statements, make other changes in the
          Registrant's Prospectus and Statement of Additional Information,
          and to satisfy the annual amendment requirement of Rule 8b-16
          under the Investment Company Act of 1940.

               This Amendment consists of the following:

                  Cross Reference Sheet
                  Part A of Form N-1A, Revised Prospectus
                  Part B of Form N-1A, Statement of Additional Information
                  Part C of Form N-1A, Other Information
                  Accountants' Consent


















































          PAGE 4
                      T. ROWE PRICE GLOBAL GOVERNMENT BOND FUND
                        T. ROWE PRICE INTERNATIONAL BOND FUND 
                     T. ROWE PRICE SHORT-TERM GLOBAL INCOME FUND
                       T. ROWE PRICE EMERGING MARKETS BOND FUND

                                CROSS REFERENCE SHEET
                 N-1A Item No.                          Location
                 _____________                          ________
                                        PART A
          Item 1.   Cover Page                       Cover Page
          Item 2.   Synopsis                         Transaction and Fund
                                                     Expenses
          Item 3.   Condensed Financial Information  Financial Highlights
          Item 4.   General Description of           Transaction and Fund
                    Registrant                       Expenses; Fund,
                                                     Market, and Risk
                                                     Characteristics; The
                                                     Fund's Organization
                                                     and Management;
                                                     Understanding Fund
                                                     Performance;
                                                     Investment Policies
                                                     and Practices
          Item 5.   Management of the Fund           Transaction and Fund
                                                     Expenses; Fund,
                                                     Market, and Risk
                                                     Characteristics; The
                                                     Fund's Organization
                                                     and Management
          Item 6.   Capital Stock and Other          Distributions and
                    Securities                       Taxes
          Item 7.   Purchase of Securities Being     Pricing Shares and
                    Offered                          Receiving Sale
                                                     Proceeds; Transaction
                                                     Procedures and Special
                                                     Requirements; Meeting
                                                     Requirements for New
                                                     Accounts; Shareholder
                                                     Services
          Item 8.   Redemption or Repurchase         Pricing Shares and
                                                     Receiving Sale
                                                     Proceeds; Transaction
                                                     Procedures and Special
                                                     Requirements;
                                                     Exchanging and
                                                     Redeeming Shares;
                                                     Shareholder Services


















          PAGE 5
          Item 9.   Pending Legal Proceedings        +
                                        PART B
          Item 10.  Cover Page                       Cover Page
          Item 11.  Table of Contents                Table of Contents
          Item 12.  General Information and History  +
          Item 13.  Investment Objectives and        Investment Objectives
                    Policies                         and Policies;
                                                     Investment Programs;
                                                     Investment
                                                     Restrictions; Risk
                                                     Factors of Investing
                                                     in Debt Obligations;
                                                     Investment
                                                     Performance; Yield
                                                     Information
          Item 14.  Management of the Registrant     Management of Funds
          Item 15.  Control Persons and Principal    Principal Holders of
                    Holders of Securities            Securities
          Item 16.  Investment Advisory and Other    Investment Management
                    Services                         Services; Custodian;
                                                     Independent
                                                     Accountants; Legal
                                                     Counsel
          Item 17.  Brokerage Allocation             Portfolio
                                                     Transactions; Code of
                                                     Ethics
          Item 18.  Capital Stock and Other          Dividends and
                    Securities                       Distributions; Capital
                                                     Stock
          Item 19.  Purchase, Redemption and         Redemptions in Kind;
                    Pricing of Securities Being      Pricing of Securities;
                    Offered                          Net Asset Value Per
                                                     Share; Federal and
                                                     State Registration of
                                                     Shares; Ratings of
                                                     Corporate Debt
                                                     Securities
          Item 20.  Tax Status                       Tax Status
          Item 21.  Underwriters                     Distributor for Funds
          Item 22.  Calculation of Yield Quotations
                    of Money Market Funds            +
          Item 23.  Financial Statements             Incorporated by
                                                     Reference from Annual
                                                     Report





















          PAGE 6
                                        PART C
          Information required to be included in Part C is set forth under
          the appropriate item, so numbered, in Part C to this Registration
          Statement
          ___________________________________
          +  Not applicable or negative answer



























































     PAGE 7                                
     INTERNATIONAL FIXED INCOME FUNDS

     Facts at a Glance

     Investment Goals High current income
     in the Short-Term Global Income
     Fund, and both high current income
     and capital appreciation in the
     other three funds, from investments
     in fixed-income securities
     throughout the world. As with any
     mutual fund, there is no guarantee
     these funds will achieve their
     goals.

     Strategy 

     Short-Term Global Income Fund
     invests primarily in high-quality
     short-term foreign and U.S. debt
     securities.  
     Global Government Bond Fund invests
     primarily in high-quality foreign
     and U.S. government bonds.
     International Bond Fund invests
     outside the U.S. in a diversified
     portfolio of nondollar-denominated
     government and corporate bonds with
     primarily high-quality credit
     ratings.
     Emerging Markets Bond Fund invests
     primarily in high-yielding and high-
     risk government and corporate debt
     securities of less-developed
     countries. Emerging market bonds
     carry a much greater risk of default
     and price decline than the higher-
     rated bonds of developed countries.
     Before investing, you should
     consider the greater risks explained
     in detail in the Risk Factors
     section.

     Risk/Reward Each fund's share price
     will fluctuate with changing
     economic, market, and currency
     exchange conditions. Emerging 


















     PAGE 8
     Markets Bond Fund and International
     Bond Fund carry greater potential
     risk and reward than the two global
     funds, primarily because of their
     unhedged currency exposure and less
     diversified holdings.

     Investor Profile Those seeking high
     current income (and capital
     appreciation in three of the funds),
     as well as greater diversification
     for their fixed-income investments,
     who can accept the volatility and
     special risks inherent in
     international investing. Appropriate
     for both regular and tax-deferred
     accounts, such as IRAs.

     Fees and Charges  100% no load. No
     sales charges; free telephone
     exchange; no 12b-1 marketing fees.

        Investment Manager  Rowe Price-
     Fleming International, Inc., was
     founded in 1979 as a joint venture
     between T. Rowe Price Associates,
     Inc. and Robert Fleming Holdings
     Ltd. As of December 31, 1994, Price-
     Fleming managed over $18 billion in
     foreign stocks and bonds through its
     offices in Baltimore, London, Tokyo,
     and Hong Kong.    

     THESE SECURITIES HAVE NOT BEEN
     APPROVED OR DISAPPROVED BY THE
     SECURITIES AND EXCHANGE COMMISSION,
     OR ANY STATE SECURITIES COMMISSION,
     NOR HAS THE SECURITIES AND EXCHANGE
     COMMISSION, OR ANY STATE SECURITIES
     COMMISSION, PASSED UPON THE ACCURACY
     OR ADEQUACY OF THIS PROSPECTUS. ANY
     REPRESENTATION TO THE CONTRARY IS A
     CRIMINAL OFFENSE.                        T. Rowe Price
                                           International Funds, Inc.
                                           May 1, 1995    

                                           Prospectus


















                                           PAGE 9
                                           Contents
                                             ______________________
                                           1 About the International
                                             Funds
                                             ______________________
                                             Transaction and Fund
                                             Expenses
                                             ______________________
                                             Financial Highlights
                                             ______________________
                                             Fund, Market, and Risk
                                             Characteristics
                                             ______________________
                                           2 About Your Account
                                             ______________________
                                             Pricing Shares;
                                             Receiving Sale
                                             Proceeds
                                             ______________________
                                             Distributions and Taxes
                                             ______________________
                                             Transaction Procedures
                                             and Special Requirements
                                             ______________________
                                           3 More About the Funds
                                             ______________________
                                             Organization and
                                             Management
                                             ______________________
                                             Understanding Fund
                                             Performance
                                             ______________________
                                             Investment Policies and
                                             Practices
                                             ______________________
                                           4 Investing With T. Rowe
                                             Price
                                             ______________________
                                             Meeting Requirements for
                                             New Accounts
                                             ______________________
                                             Opening a New Account
                                             ______________________
                                             Purchasing Additional
                                             Shares
                                             ______________________
                                             Exchanging and Redeeming


















                                           PAGE 10
                                             ______________________
                                             Shareholder Services
                                             ______________________

                                                This prospectus
                                             contains information you
                                             should know before
                                             investing. Please keep
                                             it for future reference.
                                             A Statement of
                                             Additional Information
                                             about the funds, dated
                                             May 1, 1995, has been
                                             filed with the
                                             Securities and Exchange
                                             Commission and is
                                             incorporated by
                                             reference in this
                                             prospectus. To obtain a
                                             free copy, call
                                             1-800-638-5660.    












































          PAGE 11
          1  About the International Funds
     
                                 Transaction and funds' Expenses

                                 These tables should help you understand the
                                 kinds of expenses you will bear directly or
                                 indirectly as a fund shareholder. 

                                 The first part of the table, "Shareholder
                                 Transaction Costs," shows that you pay no
                                 sales charges.  All the money you invest in
                                 a fund goes to work for you, subject to the
                                 fees explained below. "Annual Fund
                                 Expenses," provides an estimate of how much
                                 it will cost to operate each fund for a
                                 year, based on 1994 fiscal year expenses
                                 (and any expense limitations shown in Table
                                 3).  These are costs you pay indirectly,
                                 because they are deducted from the fund's
                                 total assets before the daily share price
                                 is calculated and before dividends and
                                 other distributions are made.  In other
                                 words, you will not see these expenses on
                                 your account statement.
                                 ___________________________________________
                                 Fund Expenses

                                 Shareholder Transaction Expenses

                                              Short- Global
                                               Term Govern-  Inter- Emerging
                                              Global  ment  nationalMarkets
                                              Income  Bond    Bond    Bond
                                 ___________________________________________
                                 Sales load
                                 "charge" on
                                 purchases     None    None   None    None
                                 ___________________________________________
                                 Sales load
                                 "charge" on
                                 reinvested
                                 dividends     None    None   None    None
                                 ___________________________________________
                                 Redemption
                                 fees          None    None   None    None
                                 ___________________________________________



















                                 PAGE 12
                                 Exchange
                                 fees          None    None   None    None
                                 ___________________________________________

                                 Annual Fund          Percentage of Fiscal
                                 Expenses             1994 Average Net
                                                      Assets


                                             Short-  Global
                                              Term  Govern-  Inter- Emerging
                                             Global   ment  nationalMarkets
                                            Incomeab Bondab   Bond   Bondab
                                 ___________________________________________
                                 Management
                                 fee (after
                                 reduction)   0.44%   0.36%  0.69%   0.56%
                                 ___________________________________________
                                 Distri-
                                 bution
                                 fees
                                 (12b-1)       None    None   None    None
                                 ___________________________________________
                                 Total other
                                 (Shareholder
                                 servicing,
                                 custodial,
                                 auditing, 
                                 etc.)        0.56%   0.84%  0.29%   0.69%
                                 ___________________________________________
                                 Total
                                 Fund
                                 Expenses     1.00%   1.20%  0.98%   1.25%
                                 ___________________________________________
                                 a  Had Price-Fleming not agreed to waive
                                    management fees and bear certain
                                    expenses in accordance with expense
                                    limitation agreements, fees for the
                                    following funds would have been higher:
                                    the Global Government Bond Fund's
                                    management fee and total expense ratio
                                    would have been 0.69% and 1.53%,
                                    respectively; the Short-Term Global
                                    Income Fund's management fee and total
                                    expense ratio would have been 0.59% and
                                    1.15%, respectively; and the Emerging
                                    Markets Bond Fund's management fee and 


















                                 PAGE 13
                                    total expense ratio would have been
                                    0.79% and 1.48%, respectively, based on
                                    estimated performance figures for the
                                    first year of operations.

                                 b  Organizational expenses will be charged
                                    to the fund for a period not to exceed
                                    60 months.

                                    Note:  The Funds charge a $5 fee for
                                           wire redemptions under $5,000,
                                           subject to change without notice.
                                 ___________________________________________
                                 Table 1

                                 The main types of expenses, which all
                                 mutual funds may charge against fund
                                 assets, are:

                                 o A management fee:  the percent of fund
                                   assets paid to the fund's investment
                                   manager.  Each fund's fee comprises both
                                   a group fee, discussed later, and an
                                   individual fund fee, as follows: 0.25%
                                   for the Short-Term Global Income Fund;
                                   0.35% each for the Global Government Bond
                                   and International Bond Funds; and 0.45%
                                   for Emerging Markets Bond Fund.  Because
                                   the investment programs of the funds are
                                   more costly to implement and maintain,
                                   their management fees are higher than
                                   those paid by most U.S. investment
                                   companies.

                                 o "Other" administrative expenses: 
                                   primarily the servicing of shareholder
                                   accounts, such as providing statements,
                                   reports, disbursing dividends, as well as
                                   custodial services.  For the year ended
                                   December 31, 1994, the funds paid the
                                   fees shown in Table 4 to T. Rowe Price
                                   Services, Inc. for transfer and dividend
                                   disbursing functions and shareholders
                                   services; T. Rowe Price Retirement Plan
                                   Services, Inc. for recordkeeping services
                                   for certain retirement plans; and T. Rowe
                                   Price for fund accounting services.


















                                 PAGE 14

                                 o Marketing or distribution fees:  an
                                   annual charge ("12b-1") to existing
                                   shareholders to defray the cost of
                                   selling shares to new shareholders.  T.
                                   Rowe Price funds do not levy 12b-1 fees.

                                   For further details on fund expenses,
                                   please see "The Funds' Organization and
                                   Management."

                                 o Hypothetical example:  Assume you invest
                                   $1,000, the fund returns 5% annually,
                                   expense ratios remain as previously
                                   listed, and you close your account at the
                                   end of the time periods shown.  Your
                                   expenses per would be:
     _________________________
     The table at right is
     just an example, and
     actual expenses can be
     higher or lower than
     those shown.                ___________________________________________
                                 Fund       1 Year3 Years 5 Years  10 Years
                                 ___________________________________________
                                 Short-Term
                                  Global
                                  Income      $10     $32     $55     $122
                                 ___________________________________________
                                 Global
                                  Govern-
                                  ment Bond   $12     $38     $66     $145
                                 ___________________________________________
                                 Interna-
                                  tional Bond $10     $31     $54     $120
                                 ___________________________________________
                                 Emerging
                                  Markets
                                  Bond        $13     $40     $69     $151
                                 ___________________________________________
                                 Table 2

                                    Table 3 sets forth expense ratio
                                 limitations and the periods for which they
                                 are effective.  For each, Price-Fleming has
                                 agreed to waive management fees and bear
                                 certain expenses which would cause the 


















                                 PAGE 15
                                 fund's ratio of expenses to average net
                                 assets to exceed the indicated percentage
                                 limitations.  The fees waived and expenses
                                 borne by Price-Fleming are subject to
                                 reimbursement by the fund through the
                                 indicated reimbursement date, but no
                                 reimbursement will be made if it would
                                 result in the fund's expense ratio
                                 exceeding its specified limit.    
                                 ___________________________________________
                                    Expense Ratio Limitations

                                                        Expense    Reim-
                                             Limita-     Ratio     burse-
                                              tion      Limita-     ment
                                             Period      tion       Date 
                                 ___________________________________________
                                 Short-Term
                                  Global
                                  Incomea January 1, 1994-  1.00%   December
                                          December 31, 1995         31, 1997
                                 ___________________________________________
                                 Global
                                  Government
                                  Bondb   January 1, 1995-  1.20%   December
                                          December 31, 1996         31, 1998
                                 ___________________________________________
                                 Emerging
                                  Markets
                                  Bond    December 29, 1994-1.25%   December
                                          December 31, 1996         31, 1998
                                 ___________________________________________
                                 a  The Short-Term Global Income Fund
                                    previously operated under a 1.00%
                                    limitation that expired December 31,
                                    1993.  The reimbursement period for this
                                    limitation extends through December 31,
                                    1995.

                                 b  The Global Government Bond Fund
                                    previously operated under a 1.20%
                                    limitation that expired December 31,
                                    1994. The reimbursement period for this
                                    limitation extends through December 31,
                                    1996.    
                                 ___________________________________________
                                 Table 3


















                                 PAGE 16
                                 ___________________________________________
                                    Service Fees Paid

                                         Transfer Subaccounting  Accounting
                                           Agent     Services  
                                 ___________________________________________
                                 Short-Term
                                  Global
                                  Income $ 83,000   $ 59,000      $100,000
                                 ___________________________________________
                                 Global
                                  Government
                                  Bond   $ 57,000   $ 23,000      $100,000
                                 ___________________________________________
                                 Interna-
                                  tional
                                  Bond   $389,000   $295,000      $125,000
                                 ___________________________________________
                                 Note:  The Emerging Markets Bond Fund
                                        became effective on December 29,
                                        1994, and, for the fiscal period
                                        ending December 31, 1995, is
                                        expected to pay approximately
                                        $80,000 to T. Rowe Price Services,
                                        Inc. for transfer agent services; $0
                                        to T. Rowe Price Retirement Plan
                                        Services, Inc. for recordkeeping
                                        services for retirement plans; and
                                        $100,000 to T. Rowe Price for
                                        accounting services.    
                                 ___________________________________________
                                 Table 4

                                 Financial Highlights

                                 The following table provides information
                                 about each fund's financial history.  It is
                                 based on a single share outstanding
                                 throughout each fiscal year.  The
                                 respective table is part of each fund's
                                 financial statements which are included in
                                 each fund's annual report and are
                                 incorporated by reference into the
                                 Statement of Additional Information.  This
                                 document is available to shareholders upon
                                 request.  The financial statements in the
                                 annual report have been audited by the 


















                                 PAGE 17
                                 funds' independent accountants whose
                                 respective unqualified reports cover the
                                 periods shown.

               Investment Activities    Distributions

                                     Net Real-
                                     ized and
                        Net           Unreal-   Total
                       Asset         ized Gain  from
                      Value,    Net   (Loss)   Invest-  Net   Net    Tax
                      Begin-  Invest-   on      ment  Invest-Real- Return
          Year Ended, ning of  ment   Invest-  Activi- ment  lized   of
          December 31 Period  Income   ments    ties  Income Gain  Capital
          _________________________________________________________________
          Short-Term
          Global Income
          1992a        $5.00   $.20h  $(.21)  $(.01) $(.20) $(.01)    --
          1993          4.78    .32h    .04     .36   (.32)     --    --
          1994          4.82    .30h   (.44)   (.14)  (.06)     --  $(.24)
          _________________________________________________________________

                   End of Period

                                                               Ratio
                                                                of
                                                       Ratio    Net
                                                        of    Invest-
                           Net     Total             Expenses  ment   Port-
          Year            Asset   Return                to    Income  folio
          Ended,  Total  Value, (Includes)    Net     Averageto Aver- Turn-
          DecemberDistri- End of Reinvested Assets ($    Net   age Net over
          31     butions Period Dividends) thousands) Assets  Assets  Rate
          _________________________________________________________________
          Short-Term
          Global Income
          1992a    $(.21) $4.78   (.22)%h  $ 66,297  1.00%gh 7.92%h 334.1%g
          1993      (.32)  4.82   7.87%h     97,118  1.00%h  6.74%h  92.9%
          1994      (.30)  4.38  (2.92)%h    56,374  1.00%h  6.59%h 120.2%
          _________________________________________________________________

























          PAGE 18
               Investment Activities    Distributions

                                     Net Real-
                                     ized and
                        Net           Unreal-   Total
                       Asset         ized Gain  from
                      Value,    Net   (Loss)   Invest-  Net   Net    Tax
                      Begin-  Invest-   on      ment  Invest-Real- Return
          Year Ended, ning of  ment   Invest-  Activi- ment  lized   of
          December 31 Period  Income   ments    ties  Income Gain  Capital
          _________________________________________________________________
          Global Government
          Bond
          1991c       $10.00  $ .77d  $ .30   $1.07 $ (.77)     --    --
          1992         10.30    .76d   (.44)    .32   (.76) $(.01)    --
          1993          9.85    .56d    .51    1.07   (.56)  (.28)    --
          1994         10.08    .54d   (.84)   (.30)  (.51)  (.02)  $(.03)
          _________________________________________________________________

            End of Period

                                                               Ratio
                                                                of
                                                       Ratio    Net
                                                        of    Invest-
                           Net     Total             Expenses  ment   Port-
          Year            Asset   Return                to    Income  folio
          Ended,  Total  Value, (Includes)    Net     Averageto Aver- Turn-
          DecemberDistri- End of Reinvested Assets ($    Net   age Net over
          31     butions Period Dividends) thousands) Assets  Assets  Rate
          _________________________________________________________________
          Global Government
          Bond
          1991c    $(.77)$10.30  11.31%d    $39,775  1.20%d  8.07%d  93.6%
          1992      (.77)  9.85   3.26%d     53,546  1.20%d  7.51%d 236.6%
          1993      (.84) 10.08  11.15%d     48,758  1.20%d  5.57%d 134.0%
          1994      (.56)  9.22  (3.06)%d    36,516  1.20%d  5.57%d 254.1%
          _________________________________________________________________



























          PAGE 19
               Investment Activities    Distributions

                                     Net Real-
                                     ized and
                        Net           Unreal-   Total
                       Asset         ized Gain  from
                      Value,    Net   (Loss)   Invest-  Net   Net
          Period      Begin-  Invest-   on      ment  Invest-Real-  Total
          Ended,      ning of  ment   Invest-  Activi- ment  lized Distri-
          December 31 Period  Income   ments    ties  Income Gain  butions
          _________________________________________________________________
          International
          Bond Fund
          1986e       $10.00 $ .32    $(.04)f $ .28  $ .01   $ .29 $ (.28)
          1987         10.01  1.14     (.13)f  1.01   1.64    2.65  (1.06)
          1988         11.60  1.04     (.13)    .91  (1.09)   (.18) (1.17)
          1989         10.25   .75    (1.10)   (.35)  (.75)     --   (.75)
          1990          9.15   .83      .55    1.38   (.83)   (.17) (1.00)
          1991          9.53   .77      .82    1.59   (.77)     --   (.77)
          1992         10.35   .87     (.63)    .24   (.83)   (.15)  (.98)
          1993          9.61   .69     1.18    1.87   (.69)   (.45) (1.14)
          1994         10.34   .60     (.79)   (.19)  (.60)   (.21)  (.81)
          _________________________________________________________________

                   End of Period

                                                             Ratio
                                                              of
                                                    Ratio     Net
                                                     of     Invest-
                        Net     Total             Expenses   ment   Port-
                       Asset   Return                to     Income  folio
          Period      Value,  (Includes     Net    Average to Aver- Turn-
          Ended,      End of Reinvested  Assets ($   Net    age Net over
          December 31 Period Dividends) Thousands) Assets   Assets  Rate
          _________________________________________________________________
          International
          Bond Fund
          1986e       $10.01     2.97%f $ 70,022    1.25%fg 9.48%fg217.7%g
          1987         11.60    27.57%f  400,173    1.25%f  9.47%f 284.3%
          1988         10.25    (1.27)%  407,021    1.20%   8.73%  368.1%
          1989          9.15    (3.19)%  303,897    1.23%   8.11%  293.1%
          1990          9.53    16.05%   430,386    1.15%   9.04%  211.4%
          1991         10.35    17.75%   413,985    1.24%   8.11%  295.6%
          1992          9.61     2.39%   513,927    1.08%   8.66%  357.7%
          1993         10.34    20.00%   745,244     .99%   6.58%  395.7%
          1994          9.34    (1.84)%  738,103     .98%   6.07%  345.2%


















          PAGE 20
          _________________________________________________________________
          a   For the period June 30, 1992 (commencement of operations) to
              December 31, 1992.
          b   Excludes expenses in excess of a 1.00% voluntary expense
              limitation in effect through December 31, 1993.
          c   For the period December 28, 1990 (commencement of operations)
              to December 31, 1991.
          d   Excludes expenses in excess of a 1.20% voluntary expense
              limitation in effect through December 31, 1994.
          e   For the period September 10, 1986 (commencement of
              operations) to December 31, 1986.
          f   Excludes expenses in excess of a 1.25% voluntary expense
              limitation in effect through December 31, 1987.
          g   Annualized.
          h   Excludes expenses in excess of a 1.00% voluntary expense
              limitation in effect through December 31, 1995.
          _________________________________________________________________
          Table 5

          Fund, Market, and Risk Characteristics:  What to Expect
     
     _________________________
     To help you decide
     whether an international
     fixed-income fund is
     appropriate for you, this
     section takes a closer
     look at the T. Rowe Price
     funds' investment
     programs and the markets
     in which they invest.       Why invest internationally?
                                 Interest rates vary from country to country
                                 depending on local economic conditions and
                                 monetary and fiscal policies. By investing
                                 in foreign fixed-income markets, U.S.
                                 investors can benefit from potentially
                                 higher yields than their own market
                                 provides. Also, foreign bond markets often
                                 move independently of one another and the
                                 U.S. market. Therefore, diversifying
                                 internationally across various countries
                                 can help reduce portfolio volatility and
                                 smooth out returns.

                                 What is the difference between
                                 international and global funds?
                                 Global funds invest worldwide, including 


















                                 PAGE 21
                                 both foreign and U.S. markets, while
                                 international funds invest in markets
                                 outside the U.S.

                                 What are some of the advantages of
                                 international and global fixed-income
                                 funds?
                                 Buying foreign bonds can be difficult and
                                 costly for the individual investor, and
                                 gaining access to many foreign markets can
                                 be complicated. Few investors have the
                                 time, the expertise, or the resources to
                                 evaluate foreign markets effectively on
                                 their own. Therefore, the professional
                                 management, broad diversification, and
                                 relative simplicity of mutual funds make
                                 them an attractive, low-cost vehicle for
                                 this type of investing.
     _________________________
     The fund or funds you
     select should reflect
     your individual
     investment goals, but
     should not be relied upon
     as a complete investment
     program nor be used for
     short-term trading
     purposes.                   What should I know about the funds to help
                                 me make a decision?
                                 The four funds described below offer a
                                 range of objectives and strategies to meet
                                 a variety of investment goals. The first
                                 three invest primarily in high-quality
                                 securities but differ in terms of average
                                 portfolio maturity and currency risk, as
                                 well as in investment approaches ranging
                                 from conservative to aggressive. Emerging
                                 Markets Bond Fund invests predominantly in
                                 noninvestment-grade bonds in emerging
                                 markets and offers both the highest
                                 potential reward and the greatest potential
                                 risk of loss.

                                 o Short-Term Global Income Fund. The fund's
                                   objective is to provide a high level of
                                   current income consistent with modest
                                   share price fluctuation by investing 


















                                 PAGE 22
                                   primarily in high-quality fixed-income
                                   securities. These include bonds,
                                   debentures, notes, mortgage or asset-
                                   backed securities, bank obligations such
                                   as certificates of deposit and all types
                                   of money market securities issued
                                   throughout the world. The fund may also
                                   invest in securities convertible into
                                   equity securities and securities with
                                   attached warrants or rights.  The fund
                                   will invest at least 65% of its assets in
                                   high quality securities but may invest up
                                   to 10% of assets in below investment
                                   grade, high risk bonds, including bonds
                                   in default or which have received the
                                   lowest rating.

                                   To reduce the impact of interest rate
                                   changes on the fund's share price, the
                                   portfolio's dollar-weighted average
                                   maturity will not exceed three years,
                                   although the fund can hold individual
                                   securities with longer maturities.

                                   To reduce the effect of currency
                                   fluctuations on share price, Price-
                                   Fleming will actively manage the fund's
                                   foreign currency exposure either by
                                   hedging or by investing in securities
                                   with currencies highly correlated to the
                                   U.S. dollar. Due to the high cost of
                                   currency hedging, Price-Fleming will not
                                   attempt to eliminate all currency risk,
                                   but rather only the amount thought
                                   necessary to preserve capital while
                                   providing high current income.
                                    
                                 o Global Government Bond Fund. This fund's
                                   objective is to provide high current
                                   income and, secondarily, capital
                                   appreciation and protection of principal
                                   by investing primarily in high-quality
                                   foreign and U.S. government bonds. The
                                   fund will normally have at least 65% of
                                   its assets in bonds issued or guaranteed
                                   by the U.S. or foreign governments or
                                   their agencies, and foreign authorities, 


















                                 PAGE 23
                                   provinces, and municipalities. The fund
                                   may also invest up to 10% of total assets
                                   in below investment grade high risk bonds
                                   including bonds in default or those with
                                   the lowest rating.    

                                   To reduce the effect of interest rate
                                   changes on the fund's share price while
                                   seeking higher yields, the weighted
                                   average maturity of the portfolio is
                                   likely to average around seven years,
                                   although the fund may adopt longer or
                                   shorter maturities in anticipation of
                                   falling or rising yields.  The fund may
                                   also hold individual securities with
                                   maturities longer or shorter than seven
                                   years.

                                   The fund has wide flexibility to engage
                                   in hedging strategies to reduce the
                                   impact of currency fluctuations on the
                                   share price.

                                 o International Bond Fund. The fund's
                                   objective is to provide high current
                                   income and capital appreciation by
                                   investing in high-quality, nondollar-
                                   denominated government and corporate
                                   bonds outside the U.S. The fund also
                                   seeks to moderate price fluctuation by
                                   actively managing its maturity structure
                                   and currency exposure. The fund will
                                   invest at least 65% of its assets in high
                                   quality bonds but may invest up to 20% of
                                   assets in below investment grade, high
                                   risk bonds, including bonds in default or
                                   those with the lowest rating.

                                   Price-Fleming bases its investment
                                   decisions on fundamental market factors,
                                   currency trends, and credit quality. The
                                   fund generally invests in countries where
                                   the combination of fixed-income returns
                                   and currency exchange rates appears
                                   attractive, or, if the currency trend is
                                   unfavorable, where the currency risk can
                                   be minimized through hedging.


















                                 PAGE 24
                                   Although the fund expects to maintain an
                                   intermediate to long weighted average
                                   maturity, it has no maturity restrictions
                                   on the overall portfolio or on individual
                                   securities. Normally, the fund does not
                                   hedge its foreign currency exposure back
                                   to the dollar, nor involve more than 50%
                                   of total assets in cross hedging
                                   transactions. Therefore, changes in
                                   foreign interest rates and currency
                                   exchange rates are likely to have a
                                   significant impact on total return and
                                   the market value of portfolio securities.
                                   Such changes provide greater
                                   opportunities for capital gains and
                                   greater risks of capital loss. Price-
                                   Fleming attempts to reduce these risks
                                   through diversification among foreign
                                   securities and active management of
                                   maturities and currency exposures.
                                    
                                 o Emerging Markets Bond Fund. The fund's
                                   objective is to provide high income and
                                   capital appreciation.  The fund invests
                                   at least 65% (and potentially all) of
                                   total assets in the government and
                                   corporate debt securities of emerging
                                   nations. Since these countries are less
                                   developed and their bonds carry a greater
                                   risk of default, such bonds are typically
                                   below investment grade and considered
                                   junk bonds in the U.S.    

                                   The fund may invest in the lowest-rated
                                   bonds, including those in default. While
                                   these investments may offer significantly
                                   greater total returns than the higher-
                                   quality bonds of developed foreign
                                   markets, they entail a higher degree of
                                   risk and are subject to sharp price
                                   declines. (See Risk Factors; Emerging
                                   Markets and Investment Policies; High
                                   Yield/High Risk Securities).

                                   There are no maturity restrictions on the
                                   fund. Its weighted average maturity
                                   normally ranges between 5 and 10 years, 


















                                 PAGE 25
                                   but may vary substantially because of
                                   market conditions. Approximately 65% of
                                   total assets may be denominated in U.S.
                                   dollars, and the fund will not usually
                                   hedge nondollar holdings back to the U.S.
                                   currency. Therefore, currency
                                   fluctuations can have a significant
                                   impact on the value of nondollar
                                   holdings.

                                 International funds Comparison Chart

                                 Fund Geographic Quality    Normal    Risk
                                       Emphasis     of     Currency Profile
                                                Securities Exposure(Relative
                                                                     to One
                                                                    Another)
                                 ___________________________________________
                                 Short-
                                 Term
                                 Global
                                 Income World-  Primarily    Low    Conser-
                                         wide      High              vative
                                                 Quality
                                 ___________________________________________
                                 Global
                                 Govern-
                                 ment
                                 Bond   World-  Primarily   Varies  Moderate
                                         wide      High
                                                 Quality
                                 ___________________________________________
                                 Interna-
                                 tional
                                 Bond  Outside  Primarily    High   Aggres-
                                         U.S.      High               sive
                                                 Quality
                                 ___________________________________________
                                 Emerging
                                 Markets
                                 Bond  Outside     High    Moderate   Most
                                         U.S.      Risk             Aggres-
                                                                      sive
                                 ___________________________________________

                                    What other kinds of securities can the
                                 funds invest in?


















                                 PAGE 26
                                 Short-Term Global Income, Global Government
                                 Bond, and International Bond funds invest
                                 primarily in high-quality securities to
                                 reduce credit risk. However, each of them
                                 may also invest a portion of assets in
                                 high-risk securities in an effort to
                                 enhance performance. Emerging Markets Bond
                                 Fund normally invests a significant portion
                                 (and may invest all) of its assets in high-
                                 risk, noninvestment-grade securities in
                                 pursuit of maximum income and capital
                                 appreciation. All funds ordinarily invest
                                 in the securities of at least three
                                 countries; however, all may invest in the
                                 securities of one country, including the
                                 U.S., for temporary defensive purposes. All
                                 of these funds are considered
                                 "nondiversified" for purposes of the
                                 Investment Company Act of 1940.    

                                 How does currency fluctuation affect the
                                 performance of an international or global
                                 fund?
                                 The risks unique to international and
                                 global investing are discussed in detail in
                                 the Risk Factors section. Fluctuating
                                 currencies can have either a positive or
                                 negative impact on all international and
                                 global funds regardless of the credit
                                 quality of their holdings. U.S.
                                 shareholders benefit when foreign
                                 currencies appreciate against the dollar,
                                 and are injured when foreign currencies
                                 lose value against the dollar.

                                 Price-Fleming actively manages currency
                                 risk in Short-Term Global Income Fund and
                                 Global Government Bond Fund in an effort to
                                 reduce the negative impact of a strong
                                 dollar. Short-Term Global Fund is the more
                                 conservative of these two funds because of
                                 its shorter average maturity and more
                                 extensive use of hedging back to the U.S.
                                 dollar. International Bond Fund invests
                                 almost exclusively outside the U.S. and is
                                 normally heavily exposed to foreign
                                 currencies to provide maximum potential 


















                                 PAGE 27
                                 income and appreciation, but with higher
                                 risk than the first two funds. Emerging
                                 Markets Bond Fund is the most aggressive of
                                 the funds, but its exposure to foreign
                                 currencies may be somewhat limited since
                                 many emerging market bonds are denominated
                                 in U.S. dollars.

                                 Currency risk cannot be eliminated entirely
                                 and there is no guarantee that hedging will
                                 always work. In addition, it may not be
                                 possible to effectively hedge the
                                 currencies of certain countries,
                                 particularly in emerging markets.
                                 Furthermore, hedging costs can be
                                 significant, and they are paid out of a
                                 fund's capital and reflected in the net
                                 asset value. 

                                 Risk Factors

                                 o Currency fluctuations. Transactions in
                                   foreign securities are conducted in local
                                   currencies, so dollars must often be
                                   exchanged for another currency when a
                                   stock is bought or sold or a dividend is
                                   paid. Likewise, share-price quotations
                                   and total return information reflect
                                   conversion into dollars. Fluctuations in
                                   foreign exchange rates can significantly
                                   increase or decrease the dollar value of
                                   a foreign investment, boosting or
                                   offsetting its local market return. For
                                   example, if a French bond rose 10% in
                                   price during a year, but the U.S. dollar
                                   gained 5% against the French franc during
                                   that time, the U.S. investor's return
                                   would be reduced to 5%.  This is because
                                   the franc would "buy" fewer dollars at
                                   the end of the year than at the
                                   beginning, or, conversely, a dollar would
                                   buy more francs.

                                 o Costs. It is more expensive for U.S.
                                   investors to trade in foreign markets
                                   than in the U.S. Mutual funds offer a
                                   very efficient way for individuals to 


















                                 PAGE 28
                                   invest abroad, but the overall expense
                                   ratios of international funds are usually
                                   somewhat higher than those of typical
                                   domestic stock funds.
     _________________________
        While certain
     countries have made
     progress in economic
     growth, liberalization,
     fiscal discipline, and
     political and social
     stability, there is no
     assurance these trends
     will continue.              o Political and economic factors. The
                                   economies, markets, and political
                                   structures of a number of the countries
                                   in which each fund can invest do not
                                   compare favorably with the United States
                                   and other mature economies in terms of
                                   wealth and stability. Therefore,
                                   investments in these countries will be
                                   riskier and more subject to erratic and
                                   abrupt price movements. This is
                                   especially true for emerging markets such
                                   as those found in Latin America, China,
                                   and certain Asian countries, Eastern
                                   Europe and Africa.

                                      Some economies are less well developed
                                   (for example, Latin America, Eastern
                                   Europe, African and certain Asian
                                   countries), overly reliant on particular
                                   industries and more vulnerable to the ebb
                                   and flow of international trade, trade
                                   barriers, and other protectionist or
                                   retaliatory measures (for example, Japan,
                                   Southeast Asia, Latin America, Eastern
                                   Europe and Africa). This makes investment
                                   in such markets significantly riskier
                                   than in other countries.  Some countries,
                                   particularly in Latin America and Africa,
                                   are grappling with severe inflation and
                                   high levels of national debt. Investments
                                   in countries that have recently begun
                                   moving away from central planning and
                                   state-owned industries toward free
                                   markets, such as the Eastern Europe, 


















                                 PAGE 29
                                   China and Africa, should be regarded as
                                   speculative.

                                   Certain countries have histories of
                                   instability and upheaval (for example,
                                   Latin America and Africa) with respect to
                                   their and internal politics that could
                                   cause their governments to act in a
                                   detrimental or hostile manner toward
                                   private enterprise or foreign investment.
                                   Such actions, for example, nationalizing
                                   a company or industry, expropriating
                                   assets, or imposing punitive taxes, could
                                   have a severe effect on security prices
                                   and impair the fund's ability to
                                   repatriate capital or income. Significant
                                   external risks, including war, currently
                                   affect some countries. Governments in
                                   many emerging market countries
                                   participate to some degree in their
                                   economies and securities markets.    












































     PAGE 30
     _________________________
        For more details on
     potential risks of
     foreign investments, see
     "Investment Policies and
     Practices."                 o Legal, regulatory, and operational.
                                   Certain countries lack uniform
                                   accounting, auditing, and financial
                                   reporting standards, have less
                                   governmental supervision of financial
                                   markets than in the U.S., do not honor
                                   legal rights enjoyed in the U.S., and
                                   have settlement practices, such as
                                   delays, which could subject the fund to
                                   risks of loss not customary in the U.S.
                                   In addition, securities markets in these
                                   countries have substantially lower
                                   trading volumes than U.S. markets,
                                   resulting in less liquidity and more
                                   volatility than experienced in the
                                   U.S.    

                                 o Pricing. Portfolio securities may be
                                   listed on foreign exchanges that are open
                                   on days (such as Saturdays) when the
                                   funds do not compute their prices. As a
                                   result, the fund's net asset value may be
                                   significantly affected by trading on days
                                   when shareholders cannot make
                                   transactions.

                                    How do fund managers try to reduce risk?
                                 Consistent with each fund's objective, the
                                 portfolio manager actively manages the fund
                                 in an effort to manage risk and increase
                                 total return.  Risk management tools
                                 include:

                                 o Diversification of assets to reduce the
                                   impact of a single holding on the fund's
                                   net asset value;

                                 o Thorough credit research by our analysts;

                                 o Adjustment in the fund's duration to try
                                   to reduce the negative impact of rising 



















                                 PAGE 31
                                   interest rates, or to take advantage of
                                   the favorable effects of falling rates.

                                 Depending on market outlook, the investment
                                 manager may shorten or lengthen the fund's
                                 average effective maturity within the
                                 ranges and guidelines established in this
                                 prospectus.

                                 o Currency hedging.  Each of the fund's has
                                   a different approach to managing the
                                   impact of foreign currency changes on the
                                   fund's portfolio.    

                                 How can I decide which fund may be most
                                 appropriate for me?
                                 First, be sure that your investment
                                 objective is consistent with the fund's. If
                                 you will be needing the money you plan to
                                 invest in the near future, none of these
                                 funds is suitable.

                                 Second, your decision should take into
                                 account whether you have any other foreign
                                 investments. If not, you may want to invest
                                 in one or more of the funds to gain the
                                 broadest exposure to overseas
                                 opportunities.

                                 Third, consider your risk tolerance and the
                                 risk profile of each fund, as previously
                                 described. Also, consider your investment
                                 time horizon. Long-term bond funds are
                                 suitable only for investors with long-term
                                 investment goals.

                                 Where can I find more details about the
                                 funds' policies and practices?

                                 Be sure to review "Investment Policies and
                                 Practices" in Section 3, which discusses
                                 the following: Types of Portfolio
                                 Securities (fixed income securities, brady
                                 bonds, non-diversified investment company,
                                 hybrid instruments, private placements,
                                 loan participations and assignments, high
                                 yield/high risk securities, greater credit 


















                                 PAGE 32
                                 risk, reduced market liquidity, other
                                 factors, convertible bonds, and
                                 concentration in banking industry); and
                                 Types of Management Practices (foreign
                                 currency transactions, costs of hedging,
                                 tax consequences of hedging, cash position,
                                 borrowing money and transferring assets,
                                 futures and options, lending of portfolio
                                 securities, portfolio turnover, and
                                 location of company).
          2  About Your Account
     
                                 Pricing Shares and Receiving Sale Proceeds
     _________________________
     The various ways you can
     buy, sell, and exchange
     shares are explained at
     the end of this
     prospectus and on the New
     Account Form.               Here are some procedures you should know
                                 when investing in a fund. 

                                 How and when shares are priced
                                 The share price (also called "net asset
                                 value" or NAV per share) for each fund, is
                                 calculated at 4 p.m. ET each day the New
                                 York Stock Exchange is open for business.
                                 To calculate the NAV, a fund's assets are
                                 priced and totaled, liabilities are
                                 subtracted, and the balance, called net
                                 assets, is divided by the number of shares
                                 outstanding.

                                 The calculation of each fund's net asset
                                 value normally will not take place
                                 contemporaneously with the determination of
                                 the value of the fund's portfolio
                                 securities.  Events affecting the values of
                                 portfolio securities that occur between the
                                 time their prices are determined and the
                                 time each fund's net asset value is
                                 calculated will not be reflected in the
                                 fund's net asset value unless Price-
                                 Fleming, under the supervision of the
                                 fund's Board of Directors, determines that
                                 the particular event should be taken into 



















                                 PAGE 33
                                 account in computing the fund's net asset
                                 value.
     _________________________
     When filling out the New
     Account Form, you may
     wish to give yourself the
     widest range of options
     for receiving proceeds
     from a sale.                How your purchase, sale, or exchange price
                                 is determined
                                 If we receive your request in correct form
                                 before 4 p.m. ET, your transaction will be
                                 priced at that day's NAV. If we receive it
                                 after 4 p.m., it will be priced at the next
                                 business day's NAV.

                                 We cannot accept orders that request a
                                 particular day or price for your
                                 transaction or any other special
                                 conditions.

                                    Note: The time at which transactions are
                                 priced and until which orders are accepted
                                 may be changed in case of an emergency or
                                 if the New York Stock Exchange closes at a
                                 time other than 4 p.m. ET.    

                                 How you can receive the proceeds from a
                                 sale
     _________________________
     If for some reason we
     cannot accept your
     request to sell shares,
     we will contact you.           If your request is received by 4 p.m. ET
                                 in correct form, proceeds are usually sent
                                 on the next business day. Proceeds can be
                                 sent to you by mail, or to your bank
                                 account by ACH transfer or bank wire.
                                 Proceeds sent by ACH transfer should be
                                 credited the second day after the sale. ACH
                                 (Automated Clearing House) is an automated
                                 method of initiating payments from and
                                 receiving payments in your financial
                                 institution account. ACH is a payment
                                 system supported by over 20,000 banks,
                                 savings banks and credit unions, which
                                 electronically exchanges the transactions 


















                                 PAGE 34
                                 primarily through the Federal Reserve
                                 Banks. Proceeds sent by bank wire should be
                                 credited to your account the next business
                                 day.    

                                 Exception:

                                 o Under certain circumstances and when
                                   deemed to be in the fund's best interest,
                                   your proceeds may not be sent for up to
                                   five business days after receiving your
                                   sale or exchange request. If you were
                                   exchanging into a bond or money fund,
                                   your new investment would not begin to
                                   earn dividends until the sixth business
                                   day.

                                 Useful Information on Distributions and
                                 Taxes
     _________________________
     The funds distribute all
     net investment income and
     realized capital gains to
     shareholders.               Dividends and other distributions
                                 Dividend and capital gain distributions are
                                 reinvested in additional fund shares in
                                 your account unless you select another
                                 option on your New Account Form. The
                                 advantage of reinvesting distributions
                                 arises from compounding; that is, you
                                 receive dividend and capital gain
                                 distributions on a rising number of shares.

                                 Distributions not reinvested are paid by
                                 check or transmitted to your bank account
                                 via ACH. If the Post Office cannot deliver
                                 your check, or if your check remains
                                 uncashed for six months, a fund reserves
                                 the right to reinvest your distribution
                                 check in your account at the then current
                                 NAV and to reinvest all subsequent
                                 distributions in shares of the fund.

                                    Income dividends

                                 o  Bond funds declare income dividends
                                    daily at 4 p.m. ET to shareholders of 


















                                 PAGE 35
                                    record at that time provided payment has
                                    been received on the previous business
                                    day.

                                 o  Money funds declare income dividends
                                    daily at noon ET to shareholders of
                                    record at that time provided payment has
                                    been received by that time.

                                 o  Bond and money funds pay dividends on
                                    the last business day of each month.

                                 o  Bond and money fund shares will earn
                                    dividends through the date of
                                    redemption; also, shares redeemed on a
                                    Friday or prior to a holiday will
                                    continue to earn dividends until the
                                    next business day.  Generally, if you
                                    redeem all of your shares at any time
                                    during the month, you will also receive
                                    all dividends earned through the date of
                                    redemption in the same check.  When you
                                    redeem only a portion of your shares,
                                    all dividends accrued on those shares
                                    will be reinvested, or paid in cash, on
                                    the next dividend payment date.

                                    Capital gains

                                 o  A capital gain or loss is the difference
                                    between the purchase and sale price of a
                                    security.

                                 o  If a fund has net capital gains for the
                                    year (after subtracting any capital
                                    losses), they are usually declared and
                                    paid in December to shareholders of
                                    record on a specified date that month.
                                    If a second distribution is necessary,
                                    it is usually declared and paid during
                                    the first quarter of the following year.

                                    Tax information
     _________________________   
     The funds send timely
     information for your tax
     filing needs.


















                                 PAGE 36
                                    You need to be aware of the possible tax
                                    consequences when:

                                 o  the fund makes a distribution to your
                                    account, or
                                 o  you sell fund shares, including an
                                    exchange from one fund to another.
     
                                 Taxes on fund redemptions. When you sell
                                 shares in any fund, you may realize a gain
                                 or loss. An exchange from one fund to
                                 another is still a sale for tax purposes. 

                                    In January, the funds will send you Form
                                 1099-B, indicating the date and amount of
                                 each sale you made in the fund during the
                                 prior year. This information will also be
                                 reported to the IRS. For accounts opened
                                 new or by exchange in 1983 or later, we
                                 will provide you the gain or loss of the
                                 shares you sold during the year, based on
                                 the "average cost" method. This information
                                 is not reported to the IRS, and you do not
                                 have to use it. You may calculate the cost
                                 basis using other methods acceptable to the
                                 IRS, such as "specific identification."    

                                 To help you maintain accurate records, we
                                 send you a confirmation immediately
                                 following each transaction (except for
                                 systematic purchases and redemptions) you
                                 make and a year-end statement detailing all
                                 your transactions in each fund account
                                 during the year.

                                 Taxes on fund distributions.
     _________________________
     Distributions are 
     taxable whether
     reinvested in additional
     shares or received 
     in cash.                    The following summary does not apply to
                                 retirement accounts, such as IRAs which are
                                 tax-deferred until you withdraw money from
                                 them.




















                                 PAGE 37
                                 In January, the funds will send you Form
                                 1099-DIV indicating the tax status of any
                                 dividend and capital gain distribution made
                                 to you. This information will also be
                                 reported to the IRS. All distributions made
                                 by these funds are taxable to you for the
                                 year in which they were paid. The only
                                 exception is that distributions declared
                                 during the last three months of the year
                                 and paid in January are taxed as though
                                 they were paid by December 31.  Dividends
                                 and distributions are taxable to you
                                 regardless of whether they are taken in
                                 cash or reinvested.  The funds will send
                                 you any additional information you need to
                                 determine your taxes on fund distributions,
                                 such as the portion of your dividend, if
                                 any, that may be exempt from state income
                                 taxes.

                                 Short-term capital gains are taxable as
                                 ordinary income and long-term gains are
                                 taxable at the applicable long-term gain
                                 rate. The gain is long or short term
                                 depending on how long the fund held the
                                 securities, not how long you held shares in
                                 the fund.

                                 Distributions resulting from the sale of
                                 certain foreign currencies and debt
                                 securities, to the extent of foreign
                                 exchange gains, are taxed as ordinary
                                 income or loss. If the fund pays
                                 nonrefundable taxes to foreign governments
                                 during the year, the taxes will reduce the
                                 fund's dividends, but will still be
                                 included in your taxable income.  However,
                                 you may be able to claim an offsetting
                                 credit or deduction on you tax return for
                                 your portion of foreign taxes paid by the
                                 fund.

                                    Tax effect of buying shares before a
                                 capital gain distribution. If you buy
                                 shares near or on the "record date" -- the
                                 date that establishes you as the person to
                                 receive the upcoming distribution -- you 


















                                 PAGE 38
                                 will receive, in the form of a taxable
                                 distribution, a portion of the money you
                                 just invested. Therefore, you may wish to
                                 find out the fund's record date(s) before
                                 investing. Of course, the fund's share
                                 price may, at any time, reflect
                                 undistributed capital gains or unrealized
                                 appreciation.  When these amounts are
                                 eventually distributed, they are taxable.
                                 (Note: For information on the tax
                                 consequences of passive foreign investment
                                 companies and hedging, please see
                                 "Investment Policies and Practices.")    

                                 Transaction Procedures and Special
                                 Requirements
     _________________________
     Following these
     procedures helps assure
     timely and accurate
     transactions.               Purchase Conditions

                                 Nonpayment. If your payment is not received
                                 or you pay with a check or ACH transfer
                                 that does not clear, your purchase will be
                                 cancelled. You will be responsible for any
                                 losses or expenses incurred by the fund or
                                 transfer agent, and the fund can redeem
                                 shares you own in this or another
                                 identically registered T. Rowe Price fund
                                 as reimbursement. The fund and its agents
                                 have the right to reject or cancel any
                                 purchase, exchange, or redemption due to
                                 nonpayment.

                                 U.S. dollars. All purchases must be paid
                                 for in U.S. dollars; checks must be drawn
                                 on U.S. banks.

                                 Sale (Redemption) Conditions
                                 10-day hold. If you sell shares that you
                                 just purchased and paid for by check or ACH
                                 transfer, the fund will redeem your shares
                                 at the price on the day the request is
                                 received, but will generally delay sending
                                 you the proceeds for up to 10 calendar days
                                 to allow the check or transfer to clear. If


















                                 PAGE 39
                                 you requested a redemption by mail or
                                 mailgram, the proceeds will be mailed no
                                 later than the seventh day following
                                 receipt unless the check or ACH transfer
                                 has not cleared. (The 10-day hold does not
                                 apply to purchases paid for by: bank wire;
                                 cashier's, certified, or treasurer's
                                 checks; or automatic purchases through your
                                 paycheck.)

                                    Telephone, Tele*Access (registered
                                 trademark) and PC*Access (registered
                                 trademark) Transactions. These exchange and
                                 redemption services are established
                                 automatically when you sign the New Account
                                 Form unless you check the box which states
                                 that you do not want these services. The
                                 fund uses reasonable procedures (including
                                 shareholder identity verification) to
                                 confirm that instructions given by
                                 telephone are genuine and is not liable for
                                 acting on these instructions. If these
                                 procedures are not followed, it is the
                                 opinion of certain regulatory agencies that
                                 a fund may be liable for any losses that
                                 may result from acting on the instructions
                                 given. All conversations are recorded, and
                                 a confirmation is sent promptly after the
                                 telephone transaction.    

                                 Redemptions over $250,000. Large sales can
                                 adversely affect a portfolio manager's
                                 ability to implement a fund's investment
                                 strategy by causing the premature sale of
                                 securities that would otherwise be held. If
                                 in any 90-day period, you redeem (sell)
                                 more than $250,000, or your sale amounts to
                                 more than 1% of the fund's net assets, the
                                 fund has the right to delay sending your
                                 proceeds for up to five business days after
                                 receiving your request, or to pay the
                                 difference between the redemption amount
                                 and the lesser of the two previously
                                 mentioned figures with securities from the
                                 fund.
     _________________________   



















     PAGE 40
     T. Rowe Price may bar
     excessive traders from
     purchasing shares.          Excessive Trading

                                 Frequent trades involving either
                                 substantial fund assets or a substantial
                                 portion of your account or accounts
                                 controlled by you, can disrupt management
                                 of the fund and raise its expenses. We
                                 define "excessive trading" as exceeding one
                                 purchase and sale involving the same fund
                                 within any 120-day period.

                                 For example, you are in fund A. You can
                                 move substantial assets from fund A to fund
                                 B, and, within the next 120 days, sell your
                                 shares in fund B to return to fund A or
                                 move to fund C.

                                 If you exceed the number of trades
                                 described above, you may be barred
                                 indefinitely from further purchases of T.
                                 Rowe Price funds.

                                 Three types of transactions are exempt from
                                 excessive trading guidelines: (1) trades
                                 solely between money market funds, (2)
                                 redemptions that are not part of exchanges,
                                 and (3) systematic purchases or redemptions
                                 (See "Shareholder Services").

                                 Keeping Your Account Open
                                 Due to the relatively high cost to the
                                 funds of maintaining small accounts, we ask
                                 you to maintain an account balance of at
                                 least $1,000. If your balance is below
                                 $1,000 for three months or longer, the fund
                                 has the right to close your account after
                                 giving you 60 days in which to increase
                                 your balance.

                                 Signature Guarantees
                                 You may need to have your signature
                                 guaranteed in certain situations, such as:
     _________________________   
     A signature guarantee is
     designed to protect you 


















     PAGE 41
     and the fund from fraud
     by verifying your
     signature.                  o  Written requests 1) to redeem over
                                    $50,000 or 2) to wire redemption
                                    proceeds.

                                 o  Remitting redemption proceeds to any
                                    person, address, or bank account not on
                                    record.

                                 o  Transferring redemption proceeds to a T.
                                    Rowe Price fund account with a different
                                    registration from yours. 

                                 o  Establishing certain services after the
                                    account is opened. 

                                 You can obtain a signature guarantee from
                                 most banks, savings institutions,
                                 broker/dealers and other guarantors
                                 acceptable to T. Rowe Price. We cannot
                                 accept guarantees from notaries public or
                                 organizations that do not provide
                                 reimbursement in the case of fraud.

          3  More About the funds

                                 The Funds' Organization and Management
     _________________________
     Shareholders benefit from
     T. Rowe Price's 58 years
     of investment management
     experience.                 How are the funds organized?

                                    The T. Rowe Price International Funds,
                                 Inc. currently consists of eleven series,
                                 each representing a separate class of
                                 shares and having different objectives and
                                 investment policies.  The eleven series and
                                 the years in which each was established are
                                 as follows: International Stock Fund, 1979;
                                 International Bond Fund, 1986;
                                 International Discovery Fund, 1988;
                                 European Stock Fund, New Asia Fund, Global
                                 Government Bond Fund, 1990; Japan Fund,
                                 1991; Short-Term Global Income Fund, 1992;
                                 Latin America Fund, 1993; Emerging Markets 


















                                 PAGE 42
                                 Bond Fund, 1994; and Emerging Markets Stock
                                 Fund, 1995. (The International Stock,
                                 International Discovery, European Stock,
                                 New Asia, Latin America, and Emerging
                                 Markets Stock Funds are described in a
                                 separate prospectus.)  The Corporation's
                                 Charter provides that the Board of
                                 Directors may issue additional series of
                                 shares and/or additional classes of shares
                                 for each series.  Although each fund offers
                                 only its own shares, a fund might become
                                 liable for any misstatement in the
                                 prospectus about another fund.  The funds'
                                 Board has considered this factor in
                                 approving the use of combined
                                 prospectuses.    

                                 What is meant by "shares"?
                                 As with all mutual funds, investors
                                 purchase "shares" when they invest in a
                                 fund. These shares are part of a fund's
                                 authorized capital stock, but share
                                 certificates are not issued.

                                 Each share and fractional share entitles
                                 the shareholder to:
                                 o receive a proportional interest in a
                                   fund's capital gain distributions;
                                 o cast one vote per share on certain fund
                                   matters, including the election of fund
                                   directors, changes in fundamental
                                   policies, or approval of changes in a
                                   fund's management contract.

                                 Does each fund have an annual shareholder
                                 meeting?
                                 The funds are not required to hold meetings
                                 but will do so when certain matters, such
                                 as a change in a fund's fundamental
                                 policies, are to be decided. In addition,
                                 shareholders representing at least 10% of
                                 all eligible votes may call a special
                                 meeting if they wish for the purpose of
                                 voting on the removal of any fund director.
                                 If a meeting is held and you cannot attend,
                                 you can vote by proxy. Before the meeting,
                                 the fund will send you proxy materials that


















                                 PAGE 43
                                 explain the issues to be decided and
                                 include a voting card for you to mail back.
     _________________________
     All decisions regarding
     the purchase and sale of
     fund investments are made
     by Price-Fleming--
     specifically by the
     funds' portfolio
     managers.                   Who runs the funds?
                                 General Oversight. The funds are governed
                                 by a Board of Directors that meets
                                 regularly to review the fund's investments,
                                 performance, expenses, and other business
                                 affairs. The Board elects the funds'
                                 officers. The policy of each fund is that a
                                 majority of Board members will be
                                 independent of Price-Fleming.

                                 Investment Manager.  Price-Fleming is
                                 responsible for selection and management of
                                 each fund's portfolio investments.  Price-
                                 Fleming's U.S. office is located at 100
                                 East Pratt Street, Baltimore, Maryland
                                 21202.  Price-Fleming has offices in
                                 Baltimore, London, Tokyo, and Hong Kong.
                                 Price-Fleming was incorporated in Maryland
                                 in 1979 as a joint venture between T. Rowe
                                 Price and Robert Fleming Holdings Limited
                                 (Flemings).
     _________________________
     Flemings is a diversified
     investment organization
     which participates in a
     global network of
     regional investment
     offices in New York,
     London, Zurich, Geneva,
     Tokyo, Hong Kong, Manila,
     Kuala Lumpur, South
     Korea, and Taiwan.          T. Rowe Price, Flemings, and Jardine
                                 Fleming are owners of Price-Fleming.  The
                                 common stock of Price-Fleming is 50% owned
                                 by a wholly-owned subsidiary of T. Rowe
                                 Price, 25% by a subsidiary of Flemings and
                                 25% by Jardine Fleming Group Limited
                                 (Jardine Fleming).  (Half of Jardine 


















                                 PAGE 44
                                 Fleming is owned by Flemings and half by
                                 Jardine Matheson Holdings Limited.)  T.
                                 Rowe Price has the right to elect a
                                 majority of the board of directors of
                                 Price-Fleming, and Flemings has the right
                                 to elect the remaining directors, one of
                                 whom will be nominated by Jardine Fleming.

                                 Portfolio Management.  Each fund has an
                                 Investment Advisory Group that has day-to-
                                 day responsibility for managing the
                                 portfolio and developing and executing each
                                 fund's investment program.  The advisory
                                 group for each fund consists of Peter Askew
                                 and Christopher Rothery.

                                 Peter Askew joined Price-Fleming in 1988
                                 and has 19 years of experience managing
                                 multi-currency fixed-income portfolios.  

                                 Christopher Rothery joined Price-Fleming in
                                 1994 and has 7 years of experience managing
                                 multicurrency fixed income portfolios. 
                                 Prior to joining Price-Fleming, he worked
                                 with Fleming International Fixed Income
                                 Management Limited.

                                 Portfolio Transactions.  Decisions with
                                 respect to the purchase and sale of a
                                 fund's portfolio securities on behalf of
                                 each fund are made by Price-Fleming.  The
                                 funds' Board of Directors has authorized
                                 Price-Fleming to utilize affiliates of
                                 Flemings and Jardine Fleming in the
                                 capacity of broker in connection with the
                                 execution of a fund's portfolio
                                 transactions if Price-Fleming believes that
                                 doing so would result in an economic
                                 advantage (in the form of lower execution
                                 costs or otherwise) being obtained by the
                                 fund.

                                 Marketing. T. Rowe Price Investment
                                 Services, Inc., a wholly-owned subsidiary
                                 of T. Rowe Price, distributes (sells)
                                 shares of these and all other T. Rowe Price
                                 funds.


















                                 PAGE 45

                                 Shareholder Services. T. Rowe Price
                                 Services, Inc., another wholly-owned
                                 subsidiary, acts as the funds' transfer and
                                 dividend disbursing agent and provides
                                 shareholder and administrative services.
                                 Services for certain types of retirement
                                 plans are provided by T. Rowe Price
                                 Retirement Plan Services, Inc., also a
                                 wholly-owned subsidiary. The address for
                                 each is 100 East Pratt St., Baltimore, MD
                                 21202. 

                                 How are fund expenses determined? 

                                 The management agreement spells out the
                                 expenses to be paid by the fund.  In
                                 addition to the management fee, the fund
                                 pays for the following: shareholder service
                                 expenses; custodial, accounting, legal, and
                                 audit fees; costs of preparing and printing
                                 prospectuses and reports sent to
                                 shareholders; registration fees and
                                 expenses; proxy and annual meeting expenses
                                 (if any); and director/trustee fees and
                                 expenses.

                                    The Management Fee.  This fee has two
                                 parts--an "individual fund fee" (discussed
                                 under "Transaction and Fund Expenses")
                                 which reflects the fund's particular
                                 investment management costs, and a "group
                                 fee."  The group fee, which reflects the
                                 benefits each fund derives from sharing the
                                 resources of the T. Rowe Price investment
                                 management complex, is calculated daily
                                 based on the combined net assets of all T.
                                 Rowe Price funds (except Equity Index and
                                 both Spectrum Funds and any institutional
                                 or private label mutual funds).  The group
                                 fee schedule (shown below) is graduated,
                                 declining as the asset total rises, so
                                 shareholders benefit from the overall
                                 growth in mutual fund assets.

                                       0.480% First $1 billion 
                                       0.450% Next $1 billion 


















                                 PAGE 46
                                       0.420% Next $1 billion 
                                       0.390% Next $1 billion 
                                       0.370% Next $1 billion
                                       0.360% Next $2 billion
                                       0.350% Next $2 billion
                                       0.340% Next $5 billion
                                       0.330% Next $10 billion
                                       0.320% Next $10 billion
                                       0.310% Thereafter

                                 Each fund's portion of the group fee is
                                 determined by the ratio of its daily net
                                 assets to the daily net assets of all the
                                 Price funds described above. Based on
                                 combined Price funds' assets of
                                 approximately $36 billion at December 31,
                                 1994, the Group Fee was 0.34%.    

                                    Research and Administration.  Certain
                                 administrative support is provided by T.
                                 Rowe Price which receives from Price-
                                 Fleming a fee of .15% of the market value
                                 of all assets in equity accounts, .15% of
                                 the market value of all assets in active
                                 fixed income accounts and .035% of the
                                 market value of all assets in passive fixed
                                 income accounts under Price-Fleming's
                                 management.  Additional investment research
                                 and administrative support for equity
                                 investments is provided to Price-Fleming by
                                 Fleming Investment Management Limited (FIM)
                                 and Jardine Fleming Investment Holdings
                                 Limited (JFIH) for which each receives from
                                 Price-Fleming a fee of .075% of the market
                                 value of all assets in equity accounts
                                 under Price-Fleming's management.  FIM and
                                 JFIH are wholly-owned subsidiaries of
                                 Flemings and Jardine Fleming, respectively. 
                                 JFIH receives a fee of .075% of the market
                                 value of all assets in active fixed income
                                 accounts and .0175% of such market value in
                                 passive fixed income accounts under Price-
                                 Fleming's management.    

                                 Understanding Performance Information

                                 This section should help you understand the


















                                 PAGE 47
                                 terms used to describe the funds'
                                 performance. You will come across them in
                                 shareholder reports you receive from us
                                 four times a year, in our newsletters,
                                 "Insights" reports, in T. Rowe Price
                                 advertisements, and in the media.

                                 Total Return
     _________________________
     Total return is the most
     widely used performance
     measure. Detailed
     performance information
     is included in the funds'
     annual reports and
     quarterly shareholder
     reports.                    This tells you how much an investment in a
                                 fund has changed in value over a given time
                                 period. It reflects any net increase or
                                 decrease in the share price and assumes
                                 that all dividends and capital gains (if
                                 any) paid during the period were reinvested
                                 in additional shares. Including reinvested
                                 distributions means that total return
                                 numbers include the effect of compounding,
                                 i.e., you receive income and capital gain
                                 distributions on a rising number of shares.

                                 Advertisements for the fund may include
                                 cumulative or compound average annual total
                                 return figures, which may be compared with
                                 various indices, other performance
                                 measures, or other mutual funds.

                                 Cumulative Total Return
                                 This is the actual rate of return on an
                                 investment for a specified period. A
                                 cumulative return does not indicate how
                                 much the value of the investment may have
                                 fluctuated between the beginning and the
                                 end of the period specified.

                                 Average Annual Total Return
                                 This is always hypothetical. Working
                                 backward from the actual cumulative return,
                                 it tells you what constant year-by-year
                                 return would have produced the actual, 


















                                 PAGE 48
                                 cumulative return. By smoothing out all the
                                 variations in annual performance, it gives
                                 you an idea of the investment's annual
                                 contribution to your portfolio provided you
                                 held it for the entire period in question.

                                    Yield
                                 The current or "dividend yield" on the fund
                                 or any investment tells you the
                                 relationship between the investment's
                                 current level of annual income and its
                                 price on a particular day.  The dividend
                                 yield reflects the actual income paid to
                                 shareholders for a given period,
                                 annualized, and divided by the average
                                 price during the given period.  For
                                 example, a fund providing $5 of annual
                                 income per share and a price of $50 has a
                                 current yield of 10%.  Yields can be
                                 calculated for any time period.

                                 The advertised or "SEC yield" is found by
                                 determining the net income per share (as
                                 defined by the SEC) earned by the fund
                                 during a 30-day base period and dividing
                                 this amount by the per-share price on the
                                 last day of the base period.  The "SEC
                                 yield" may differ from the dividend
                                 yield.    

                                 Investment Policies and Practices

                                 This section takes a detailed look at some
                                 of the types of securities the funds may
                                 hold in their portfolios and the various
                                 kinds of investment practices that may be
                                 used in day-to-day portfolio management.
                                 The funds' investment programs are subject
                                 to further restrictions and risks described
                                 in the "Statement of Additional
                                 Information."
     _________________________   
     Fund managers have
     considerable leeway in
     choosing investment
     strategies and selecting
     securities they believe 


















     PAGE 49
     will help the funds
     achieve their objectives.   Shareholder approval is required to 
                                 substantively change a fund's objective
                                 (stated on page __) and certain investment
                                 restrictions noted in the following section
                                 as "fundamental policies."  The managers
                                 also follow certain "operating policies"
                                 which can be changed without shareholder
                                 approval.  However, significant changes are
                                 discussed with shareholders in fund
                                 reports. The funds adhere to applicable
                                 investment restrictions and policies at the
                                 time it makes an investment. A later change
                                 in circumstances will not require the sale
                                 of an investment if it was proper at the
                                 time it was made.

                                 The fund's holdings of certain kinds of
                                 investments cannot exceed maximum
                                 percentages of total assets, which are set
                                 forth herein. For instance, each fund is
                                 not permitted to invest more than 10% of
                                 total assets in hybrid instruments. While
                                 these restrictions provide a useful level
                                 of detail about the fund's investment
                                 program, investors should not view them as
                                 an accurate gauge of the potential risk of
                                 such investments. For example, in a given
                                 period, a 5% investment in hybrid
                                 securities could have significantly more
                                 than a 5% impact on the fund's share price.
                                 The net effect of a particular investment
                                 depends on its volatility and the size of
                                 its overall return in relation to the
                                 performance of all the fund's other
                                 investments.

                                 Changes in the fund's holdings, the fund's
                                 performance, and the contribution of
                                 various investments are discussed in the
                                 shareholder reports we send each quarter.

                                 Types of Portfolio Securities 

                                 In seeking to meet its investment
                                 objective, the funds may invest in any type
                                 of security (including certain potentially 


















                                 PAGE 50
                                 high risk derivatives) whose investment
                                 characteristics are consistent with the
                                 fund's investment program. These and some
                                 of the other investment techniques the
                                 funds may use are described in the
                                 following pages.

                                 Fixed Income Securities.  The Funds'
                                 investments may include but shall not be
                                 limited to: (1) Debt obligations issued or
                                 guaranteed by: (a) a foreign sovereign
                                 government or one of its agencies,
                                 authorities, instrumentalities or political
                                 subdivisions including a foreign state,
                                 province or municipality, and (b)
                                 supranational organizations such as the
                                 World Bank, Asian Development Bank,
                                 European Investment Bank, and European
                                 Economic Community; (2) Debt obligations:
                                 (a) of foreign banks and bank holding
                                 companies, and (b) of domestic banks and
                                 corporations issued in foreign currencies; 
                                 and (3) Foreign corporate debt securities
                                 and commercial paper.  Such securities may
                                 take a variety of forms including those
                                 issued in the local currency of the issuer,
                                 Brady bonds, Euro bonds, and bonds
                                 denominated in the ECU.  Normally, the
                                 International Bond Fund will only purchase
                                 bonds denominated in foreign currencies.
                                 The Short-Term Global Income, Global
                                 Government Bond and Emerging Markets Bond
                                 Funds may also invest in: such dollar
                                 denominated fixed income securities as (1)
                                 Debt obligations issued or guaranteed by
                                 the U.S. Government, its agencies or
                                 instrumentalities; (2) Domestic corporate
                                 debt securities; (3) Domestic commercial
                                 paper, including commercial paper indexed
                                 to certain specific foreign currency
                                 exchange rates; (4) Debt obligations of
                                 domestic banks and bank holding companies;
                                 and (5) Collateralized mortgage obligations
                                 or asset-backed bonds.  The Funds may from
                                 time to time purchase securities on a when-
                                 issued basis and invest in repurchase
                                 agreements.


















                                 PAGE 51

                                 Brady Bonds.  Brady bonds, named after
                                 former U.S. Secretary of the Treasury
                                 Nicholas Brady, are used as a means of
                                 restructuring the external debt burden of a
                                 government in certain emerging markets.  A
                                 Brady bond is created when an outstanding
                                 commercial bank loan to a government or
                                 private entity is exchanged for a new bond
                                 in connection with a debt restructuring
                                 plan.  Brady bonds may be collateralized or
                                 uncollateralized and issued in various
                                 currencies (although typically in the U.S.
                                 dollar).  They are often fully
                                 collateralized as to principal in U.S.
                                 Treasury zero coupon bonds.  However, even
                                 with this collateralization feature, Brady
                                 Bonds are often considered speculative,
                                 below investment grade investments because
                                 the timely payment of interest is the
                                 responsibility of the issuing party (for
                                 example, a Latin American country) and the
                                 value of the bonds can fluctuate
                                 significantly based on the issuer's ability
                                 or perceived ability to make these
                                 payments. Finally, some Brady Bonds may be
                                 structured with floating rate or low fixed
                                 rate coupons.

                                 Operating policy:  Normally, Short-Term
                                 Global Income, Global Government Bond, and
                                 International Bond funds do not expect to
                                 have more than 10% of their total assets in
                                 Brady Bonds.  The Emerging Markets Bond
                                 Fund may invest without limitation in such
                                 bonds. 

                                 Non-diversified Investment Company.  The
                                 Funds are able to invest more than 5% of
                                 their assets in the fixed-income securities
                                 of individual foreign governments; however,
                                 each will not invest more than 5% of its 
                                 assets in any individual corporate issuer. 
                                 This policy does not prohibit a Fund from
                                 maintaining more than 5% of its assets,
                                 including cash or currency, in custodial
                                 accounts of a Fund's custodian or 


















                                 PAGE 52
                                 subcustodian.  In addition, each Fund
                                 intends to qualify as a regulated
                                 investment company for purposes of the
                                 Internal Revenue Code.  Such qualification
                                 requires each Fund to limit its investments
                                 so that, at the end of each calendar
                                 quarter, with respect to at least 50% of
                                 its total assets, not more than 5% of such
                                 assets are invested in the securities of a
                                 single issuer.  Since, as a non-diversified
                                 investment company, each Fund is permitted
                                 to invest a greater proportion of its
                                 assets in the securities of a smaller
                                 number of issuers, the Funds may be subject
                                 to greater credit risk with respect to
                                 their portfolio securities than an
                                 investment company which is more broadly
                                 diversified.

                                 Hybrid Instruments. These instruments (a
                                 type of potentially high risk derivative)
                                 can combine the characteristics of
                                 securities, futures and options.  For
                                 example, the principal amount or interest
                                 rate of a hybrid could be tied (positively
                                 or negatively) to the price of some
                                 commodity, currency or securities index or
                                 another interest rate (each a "benchmark"). 
                                 Hybrids can be used as an efficient means
                                 of pursuing a variety of investment goals,
                                 including currency hedging, duration
                                 management, and increased total return. 
                                 Hybrids may not bear interest or pay
                                 dividends.  The value of a hybrid or its
                                 interest rate may be a multiple of a
                                 benchmark and, as a result, may be
                                 leveraged and move (up or down) more
                                 steeply and rapidly than the benchmark. 
                                 These benchmarks may be sensitive to
                                 economic and political events, such as
                                 commodity shortages and currency
                                 devaluations, which cannot be readily
                                 foreseen by the purchaser of a hybrid. 
                                 Under certain conditions, the redemption
                                 value of a hybrid could be zero.  Hybrids
                                 can have volatile prices and limited
                                 liquidity.  Thus, an investment in a hybrid


















                                 PAGE 53
                                 may entail significant market risks that
                                 are not associated with a similar
                                 investment in a traditional, U.S. dollar-
                                 denominated bond that has a fixed principal
                                 amount and pays a fixed rate or floating
                                 rate of interest.  The purchase of hybrids
                                 also exposes the fund to the credit risk of
                                 the issuer of the hybrid.  These risks may
                                 cause significant fluctuations in the net
                                 asset value of the fund.  

                                 Operating policy:  Each fund may invest up
                                 to 10% of its total assets in hybrid
                                 instruments.

                                 Private Placements. These securities are
                                 sold directly to a small number of
                                 investors, usually institutions. Unlike
                                 public offerings, such securities are not
                                 registered with the SEC. Although certain
                                 of these securities may be readily sold,
                                 for example, under Rule 144A, the sale of
                                 others may involve substantial delays and
                                 additional costs.

                                 Operating policy: Each fund will not invest
                                 more than 15% of its net assets in illiquid
                                 securities, and no more than 5% in certain
                                 restricted securities.

                                 Loan Participations and Assignments.  Large
                                 loans to corporations or governments,
                                 including governments of less developed
                                 countries (LDCs), may be shared or
                                 syndicated among several lenders, usually
                                 banks.  The Fund could participate in such
                                 syndicates, or could buy part of a loan,
                                 becoming a direct lender.  Participations
                                 and assignments involve special types of
                                 risk, including limited marketability and
                                 the risks of being a lender.  If a Fund
                                 purchases a participation, it may only be
                                 able to enforce its rights through the
                                 lender, and may assume the credit risk of
                                 the lender in addition to the borrower.  In
                                 assignments, the Fund's rights against the
                                 borrower may be more limited than those 


















                                 PAGE 54
                                 held by the original lender.

                                    Operating policy:  Short-Term Global
                                 Income, Global Government Bond and
                                 International Bond Funds may not invest
                                 more than 5% and Emerging Markets Bond Fund
                                 not more than 10% of total assets in loan
                                 participations and assignments.    
     _________________________
     Defaulted bonds are
     acquired only if the fund
     manager foresees the
     potential for significant
     capital appreciation.       High Yield/High Risk Securities: While
                                 investment in high yield, lower quality
                                 securities offers the opportunity for
                                 substantial income and capital
                                 appreciation, there are significant risks
                                 associated with such investments,
                                 including:

                                 Greater credit risk. Companies and
                                 governments issuing lower rated bonds are
                                 not as strong financially as those with
                                 higher credit ratings and their bonds are
                                 often viewed as speculative investments.
                                 Such issuers are more vulnerable to real or
                                 perceived business setbacks and to changes
                                 in the economy, such as a recession, that
                                 might impair their ability to make timely
                                 interest and principal payments. Certain
                                 less developed governments have in the past
                                 defaulted on payment of interest and
                                 principal on debt they have issued. As a
                                 result, your fund manager relies heavily on
                                 proprietary Price-Fleming research when
                                 selecting these investments.
                                   
                                 Reduced market liquidity. High yielding
                                 emerging market bonds are generally less
                                 "liquid" than higher-quality bonds issued
                                 by companies and governments in developed
                                 countries.  Consequently large purchases or
                                 sales of certain high yield emerging market
                                 debt issues may cause significant changes
                                 in their prices. Because many of these
                                 bonds do not trade frequently, when they do


















                                 PAGE 55
                                 trade, their price may be substantially
                                 higher or lower than had been expected. A
                                 lack of liquidity also means that judgment
                                 may play a bigger role when seeking to
                                 establish the fair value of the securities.

                                 Other factors.  The major factor
                                 influencing prices of high-quality bonds is
                                 changes in interest rate levels; but this
                                 is only one of several factors which affect
                                 prices of lower quality bonds.  Because the
                                 credit quality of the issuer is lower, such
                                 bonds are more sensitive to developments
                                 affecting the issuer's underlying
                                 fundamentals, such as changes in financial
                                 condition, or a given country's economy in
                                 general.  In addition, the entire bond
                                 market in an emerging market can experience
                                 sudden and sharp price swings due to a
                                 variety of factors, including changes in
                                 economic forecasts, stock market activity,
                                 large or sustained sales by such investors,
                                 a high-profile default, a political
                                 upheaval of some kind or just a change in
                                 the market's psychology.  This type of
                                 volatility is usually associated more with
                                 stocks than bonds, but investors in lower
                                 quality bonds should also anticipate it.

                                 Since mutual funds can be a major source of
                                 demand in certain markets, substantial cash
                                 flows into and out of these funds can
                                 affect high-yield bond prices.  If, for
                                 example, a significant number of funds were
                                 to sell bonds to meet shareholder
                                 redemptions, both bond prices and the
                                 fund's shares price could fall more than
                                 underlying fundamentals might justify.

                                    Operating policy: Short-Term Global
                                 Income, Global Government Bond, and
                                 International Bond Funds may invest up to
                                 10%, 10% and 20%, respectively, of total
                                 assets in below investment grade ("junk")
                                 bonds.  The Emerging Markets Bond Fund may
                                 invest substantially all of its assets in
                                 such bonds.    


















     PAGE 56
        Emerging Markets Bond
     Fund                        Convertible Bonds.  Convertible bonds are
                                 debt instruments convertible into equity of
                                 the issuing company at certain times in the
                                 future and according to a certain exchange
                                 ratio. Typically convertible bonds are
                                 callable by the company, which may, in
                                 effect, force conversion before the holder
                                 would otherwise choose.

                                 While the fund intends to invest primarily
                                 in debt securities, it may invest in
                                 convertible bonds or equity securities.
                                 While some countries or companies may be
                                 regarded as favorable investments, pure
                                 fixed income opportunities may be
                                 unattractive or limited due to insufficient
                                 supply or legal or technical restrictions.
                                 In such cases, the fund may consider equity
                                 securities or convertible bonds to gain
                                 exposure to such markets.

                                 Operating policy: The fund may invest up to
                                 10% of its total assets in convertible
                                 bonds and equity securities.
    
   

     International Bond Fund     Concentration in Banking Industry.  When
                                 the Fund's position in issues maturing in
                                 one year or less equals 35% or more of the
                                 Fund's total assets, the Fund will, as a
                                 matter of fundamental policy, normally have
                                 25% or more of its assets concentrated in
                                 securities in the banking industry. 
                                 Investments in the banking industry may be
                                 affected by general economic conditions,
                                 exposure to credit losses arising from
                                 possible financial difficulties of
                                 borrowers, and the profitability of the
                                 banking industry is largely dependent on
                                 the availability and cost of funds for the
                                 purpose of financing lending operations
                                 under prevailing money market conditions.

                                 Types of Management Practices
     _________________________   
     Cash reserves provide
     flexibility and serve as 


















     PAGE 57
     a short-term defense
     during periods of unusual
     market volatility.          
    
   Foreign Currency Transactions.  Each
                                 fund may engage in foreign currency
                                 transactions either on a spot (cash) basis
                                 at the rate prevailing in the currency
                                 exchange market at the time or through
                                 forward currency contracts ("forwards")
                                 with terms generally of less than one year. 
                                 Forwards will be used primarily to adjust
                                 the foreign exchange exposure of each fund
                                 with a view to protecting the portfolio
                                 from adverse currency movements, based on
                                 Price-Fleming's outlook, and the funds
                                 might be expected to enter into such
                                 contracts under the following
                                 circumstances:

                                 Lock In.  When management desires to lock
                                 in the U.S. dollar price on the purchase or
                                 sale of a security denominated in a foreign
                                 currency.

                                 Cross Hedge.  If a particular currency is
                                 expected to decrease against another
                                 currency, a fund may sell the currency
                                 expected to decrease and purchase a
                                 currency which is expected to increase
                                 against the currency sold in an amount
                                 approximately equal to some or all of the
                                 fund's portfolio holdings denominated in
                                 the currency sold.

                                 Direct Hedge.  If Price-Fleming wants to
                                 eliminate substantially all of the risk of
                                 owning a particular currency, and/or if
                                 Price-Fleming expects the portfolio can
                                 benefit from price appreciation in a given
                                 country's bonds but does not want to hold
                                 the currency, if may employ a direct hedge
                                 back into the U.S. dollar.  In either case,
                                 the fund would enter into a forward
                                 contract to sell the currency in which a
                                 portfolio security is denominated and
                                 purchase U.S. dollars at an exchange rate
                                 established at the time it initiated the
                                 contract.  The cost of the direct hedge 


















                                 PAGE 58
                                 transaction may offset most, if not all, of
                                 the yield advantage offered by the foreign
                                 security but a fund would hope to benefit
                                 from an increase (if any) in value of the
                                 bond.  Under normal conditions, the
                                 International Bond Fund will not engage in
                                 direct hedges of this sort.

                                 Proxy Hedge.  Price-Fleming might choose to
                                 use a proxy hedge, which is less costly
                                 than a direct hedge.  In this case, the
                                 fund, having purchased a bond, will sell a
                                 currency whose value is believed to be
                                 closely linked to the currency in which the
                                 bond is denominated.  Interest rates
                                 prevailing in the country whose currency
                                 was sold would be expected to be closer to
                                 those in the U.S. and lower than those of
                                 bonds denominated in the currency of the
                                 original holding.  This type of hedging
                                 entails greater risk than a direct hedge
                                 because it is dependent on a stable
                                 relationship between the two currencies
                                 paired as proxies and the relationships can
                                 be very unstable at times.

                                 Forward contracts do involve other risks,
                                 including, but not limited to, significant
                                 volatility in currency market.  In
                                 addition, currency moves may not occur
                                 exactly as Price-Fleming expected, so use
                                 of forward contracts could adversely affect
                                 the fund's total return.  Finally, it is
                                 often not possible to effectively hedge the
                                 currency risk associated with emerging
                                 market bonds because their currency markets
                                 are not sufficiently developed.

                                 Costs of Hedging.  When the fund purchases
                                 a foreign bond with a higher interest rate
                                 than in available on U.S. bonds of a
                                 similar maturity, the additional yield on
                                 the foreign bond could be substantially
                                 lost if the fund were to enter into a
                                 direct hedge by selling the foreign
                                 currency and purchasing the U.S. dollar.



















                                 PAGE 59
                                 This is what is known as the "cost" of
                                 hedging. Proxy hedging attempts to reduce
                                 this cost through an indirect hedge back to
                                 the U.S. dollar.

                                 It is important to note that hedging costs
                                 are treated as capital transactions and are
                                 not, therefore, deducted from the fund's
                                 dividend distribution and are not reflected
                                 in its yield.  Instead such costs will,
                                 over time, be reflected in the fund's net
                                 asset value per share.  As a consequence,
                                 the fund's yield may not be an accurate
                                 indicator of its total return.    

                                 Tax Consequences of Hedging.  Under
                                 applicable tax law, the funds may be
                                 required to limit their gains from hedging
                                 in foreign currency forwards, futures and
                                 options.  Although the funds are expected
                                 to comply with such limits, the extent to
                                 which these limits apply is subject to tax
                                 regulations as yet unissued.  Hedging may
                                 also result in the application of the mark-
                                 to-market and straddle provisions of the
                                 Internal Revenue Code.  These provisions
                                 could result in an increase (or decrease)
                                 in the amount of taxable dividends paid by
                                 the funds and could affect whether
                                 dividends paid by the funds are classified
                                 as capital gains or ordinary income.

                                 Cash Position. Each fund will hold a
                                 certain portion of its assets in U.S. and
                                 foreign dollar denominated money market
                                 securities, including repurchase
                                 agreements, in the two highest rating
                                 categories, maturing in one year or less.
                                 For temporary, defensive purposes, a fund
                                 may invest without limitation in such
                                 securities. This reserve position provides
                                 flexibility in meeting redemptions,
                                 expenses, and the timing of new
                                 investments, and serves as a short-term
                                 defense during periods of unusual market
                                 volatility.



















                                 PAGE 60
                                 Borrowing Money and Transferring Assets.
                                 Each fund can borrow money from banks as a
                                 temporary measure for emergency purposes,
                                 to facilitate redemption requests, or for
                                 other purposes consistent with the funds'
                                 investment objectives and program. Such
                                 borrowings may be collateralized with fund
                                 assets, subject to restrictions.

                                 Fundamental policy: Borrowings may not
                                 exceed 33 1/3% of a fund's total fund
                                 assets.

                                 Operating policies: Each fund may not
                                 transfer as collateral any portfolio
                                 securities except as necessary in
                                 connection with permissible borrowings or
                                 investments, and then such transfers may
                                 not exceed 33 1/3% of the fund's total
                                 assets. A fund may not purchase additional
                                 securities when borrowings exceed 5% of
                                 total assets.
     _________________________
     Futures are used to
     manage risk; options give
     the investor the option
     to buy or sell an asset
     at a predetermined price
     in the future.                 Futures and Options. Futures (a type of
                                 potentially high risk derivative) are often
                                 used to manage risk, because they enable
                                 the investor to buy or sell an asset in the
                                 future at an agreed upon price. Options
                                 (another type of potentially high risk
                                 derivative) give the investor the right,
                                 but not the obligation, to buy or sell an
                                 asset at a predetermined price in the
                                 future. The funds may buy and sell futures
                                 contracts (and options on such contracts)
                                 to manage its exposure to changes in
                                 interest rates, securities prices and
                                 foreign currencies; as an efficient means
                                 of adjusting overall exposure to certain
                                 markets; to protect portfolio value; and to
                                 adjust the portfolio's duration. The funds
                                 may purchase, sell, or write call and put 



















                                 PAGE 61
                                 options on securities, financial indices,
                                 and foreign currencies.    

                                 Futures Contracts and Options may not
                                 always be successful hedges; their prices
                                 can be highly volatile; using them could
                                 lower a fund's total return; and the
                                 potential loss from the use of futures can
                                 exceed a fund's initial investment in such
                                 contracts.

                                 Operating policies: Futures: Initial margin
                                 deposits and premiums on options used for
                                 non-hedging purposes will not equal more
                                 than 5% of a fund's net asset value.
                                 Options on securities: The total market
                                 value of securities against which a fund
                                 has written call or put options may not
                                 exceed 25% of its total assets.  A fund
                                 will not commit more than 5% of its total
                                 assets to premiums when purchasing call or
                                 put options.

                                 Lending of Portfolio Securities. Like other
                                 mutual funds, the funds may lend securities
                                 to broker-dealers, other institutions, or
                                 other persons to earn additional income.
                                 The principal risk is the potential
                                 insolvency of the broker-dealer or other
                                 borrower. In this event, the funds could
                                 experience delays in recovering securities
                                 and possibly capital losses.

                                 Fundamental policy: The value of loaned
                                 securities may not exceed 33 1/3% of a
                                 fund's total assets.

                                 Portfolio Turnover. Turnover is an
                                 indication of frequency. The funds will not
                                 generally trade in securities for short-
                                 term profits, but when circumstances
                                 warrant, securities may be purchased and
                                 sold without regard to the length of time
                                 held. The funds' portfolio turnover rates
                                 for the previous three years are shown in
                                 the Table below. The portfolio turnover
                                 rate for Emerging Markets Bond Fund is not


















                                 PAGE 62
                                 expected to exceed 150% during its first
                                 year of operations.
                                 ______________________________________
                                    Portfolio Turnover Rates
                                  
                                                1992      1993   1994
                                 ______________________________________
                                 Interna-
                                 tional
                                 Bond Fund      357.7%   395.7% 345.2%
                                 ______________________________________
                                 Short-Term 
                                 Global
                                 Income
                                 Fund           334.1%   92.9%* 120.2%
                                 ______________________________________
                                 Global  
                                 Government
                                 Bond Fund      236.6%  134.0%* 254.1%
                                 ______________________________________
                                 * The decrease in the portfolio turnover
                                   rate from the prior year was due to the
                                   funds' adopting a buy and hold strategy
                                   due to decreasing interest rates.    

                                 Emerging Markets Bond Fund

                                 Location of Company.  In determining the
                                 domicile or nationality of a company, the
                                 fund would primarily consider the following
                                 factors: whether the company is organized
                                 under the laws of a particular country; or,
                                 whether the company derives a significant
                                 proportion (at least 50%) of its revenues
                                 or profits from goods produced or sold,
                                 investments made, or services performed in
                                 the country or has at least 50% of its
                                 assets situated in that country.

                                 The fund will invest at least 65% of its
                                 total assets in companies located (as
                                 defined above) in the respective countries
                                 or regions indicated.






















          PAGE 63

          The Generic Service Section 4 for the T. Rowe Price International
          Funds, Inc., should be inserted here.

          






          PAGE 1
          4 Investing with T. Rowe Price
     
                                 Meeting Requirements for New Accounts
     ________________________
     Always verify your 
     transactions by carefully
     reviewing the
     confirmation we send 
     you.  Please report any 
     discrepancies to 
     Shareholder Services.       Tax Identification Number
                                    We must have your correct social
                                 security or corporate tax identification
                                 number on a signed New Account Form or W-9
                                 Form. Otherwise, federal law requires the
                                 funds to withhold a percentage (currently
                                 31%) of your dividends, capital gain
                                 distributions, and redemptions, and may
                                 subject you to an  IRS fine. If this
                                 information is not received within 60  days
                                 after your account is established, your
                                 account may be redeemed, priced at the NAV
                                 on the date of redemption.    

                                 Unless you request otherwise, one
                                 shareholder report will be mailed to 
                                 multiple account owners with the same tax
                                 identification number and same zip code and 
                                 to shareholders who have requested that
                                 their account be combined with someone
                                 else's for financial reporting.

                                 Opening a New Account:  $2,500 minimum
                                 initial investment; $1,000 for retirement
                                 or gifts or transfers to minors (UGMA/UTMA)
                                 accounts

                                 Account Registration
                                 If you own other T. Rowe Price funds, be
                                 sure to register any new account just like
                                 your existing accounts so you can exchange
                                 among them easily. (The name and account
                                 type would have to be identical.) 
     ________________________    
     Regular Mail
     T. Rowe Price 
     Account Services 
     P.O. Box 17300
     Baltimore, MD 
     21298-9353

     Mailgram, Express,
     Registered, or Certified












     PAGE 2
     Mail
     T. Rowe Price 
     Account Services
     10090 Red Run Blvd.
     Owings Mills, MD 21117      By Mail
                                    Please make your check payable to T.
                                 Rowe Price Funds (otherwise it will be
                                 returned)  and send your check together
                                 with the New Account Form to the address at
                                 left.  We do not accept third party checks,
                                 except for IRA Rollover checks, to open new
                                 accounts.    

                                 By Wire
                                 o Call Investor Services for an account
                                 number and give the following wire address
                                 to your bank: Morgan Guaranty Trust Co. of
                                 New  York, ABA# 021000238, T. Rowe Price
                                 [fund  name], AC-00153938, account name(s),
                                 and account number.

                                 o Complete a New Account Form and mail it  
                                   to one of the appropriate addresses 
                                   listed at left. 
                                   Note: No services will be established and
                                   IRS penalty withholding may occur until a
                                   signed New Account Form is received. 
                                   Also, retirement plans cannot be opened
                                   by wire.

                                 By Exchange
                                    Call Shareholder Services or use
                                 Tele*Access (registered trademark) or
                                 PC*Access (registered trademark) (see
                                 "Automated Services" under "Shareholder
                                 Services"). The new account will have the
                                 same registration as the account from which
                                 you are exchanging. Services for the new
                                 account may be carried over by telephone
                                 request if preauthorized on the existing
                                 account. (See explanation of "Excessive
                                 Trading" under "Transaction
                                 Procedures.")    

                                 In Person
                                 Drop off your New Account Form at any of
                                 the locations listed below and obtain a
                                 receipt.

















                                 PAGE 3
                                 Drop-off locations:

                                 101 East Lombard St. T. Rowe Price
                                 Baltimore, MD        Financial Center
                                                      10090 Red Run Blvd.
                                                      Owings Mills, MD   

                                 Farragut Square      ARCO Tower
                                 900 17th St., N.W.   31st Floor
                                 Washington, DC       515 South Flower St.
                                                      Los Angeles, CA

                                    Note: The fund and its agents reserve
                                 the right to waive or lower investment
                                 minimums; to accept initial purchases by
                                 telephone or mailgram; cancel or rescind
                                 any purchase or exchange (for example, if
                                 an account has been restricted due to
                                 excessive trading or fraud) upon notice to
                                 the shareholder within five business days
                                 of the trade or if the written confirmation
                                 has not been received by the shareholder,  
                                 whichever is sooner; to otherwise modify
                                 the conditions of purchase and any 
                                 services at any time; to act on
                                 instructions believed to be genuine; or to
                                 freeze any account and temporarily suspend
                                 services on the account when notice has
                                 been received of a dispute between the
                                 registered or beneficial account owners or
                                 there is reason to believe a fraudulent
                                 transaction may occur.    

                                    Purchasing Additional Shares: $100
                                 minimum purchase; $50 minimum for
                                 retirement plans and Automatic Asset
                                 Builder.    

                                 By ACH Transfer
                                 Use Tele*Access(registered trademark),
                                 PC*Access(registered trademark) or call
                                 Investor Services if you have established
                                 electronic transfers using the ACH network.

                                 By Wire
                                 Call Shareholder Services or use the wire
                                 address in "Opening a New Account."

     ________________________    
     Regular Mail
     T. Rowe Price Funds
     Account Services
     P.O. Box 89000












     PAGE 4
     Baltimore, MD
     21289-1500                  By Mail
                                 o Provide your account number and the fund 
                                   name on your check.
                                 o    Mail the check to us at the address
                                   shown at left either with a fund
                                   reinvestment slip   or a note indicating
                                   the fund and account  number in which you
                                   wish to purchase shares.    

                                 By Automatic Asset Builder
                                 Fill out the Automatic Asset Builder
                                 section on the New Account or Shareholder
                                 Services Form ($50 minimum).  

                                        
                                 Exchanging and Redeeming Shares

                                 By Phone
                                    Call Shareholder Services. If you find
                                 our phones busy during unusually volatile
                                 markets, please consider placing your order
                                 by Tele*Access (registered trademark),
                                 PC*Access (registered trademark) (if you
                                 have previously authorized telephone
                                 services), mailgram or by express mail. For
                                 exchange policies, please see "Transaction
                                 Procedures and Special Requirements--
                                 Excessive Trading."    

                                    Redemption proceeds can be mailed to
                                 your account address, sent by ACH transfer,
                                 or wired to your bank (provided your bank
                                 information is already on file). For
                                 charges, see "Electronic Transfers--By
                                 Wire" under "Shareholder Services".    
     _________________________
        Mailgram, Express, 
     Registered, or 
     Certified Mail
     (See "Opening a New
     Account".)                  By Mail
                                 Provide account name(s) and numbers, fund
                                 name(s), and exchange or redemption amount.
                                 For exchanges, mail to the appropriate
                                 address below or at left, indicate the fund
                                 you are exchanging from and the fund(s) you
                                 are exchanging into. T. Rowe Price requires
                                 the signatures of all owners exactly as
                                 registered, and possibly a signature
                                 guarantee (see "Transaction Procedures and
                                 Special Requirements--Signature
                                 Guarantees").












                                 PAGE 5

                                                  Regular Mail

                                 For nonretirement   For employer-sponsored
                                 and IRA accounts:    retirement accounts:
                                 T. Rowe Price        T. Rowe Price Trust
                                 Account Services     Company
                                 P.O. Box 89000       P.O. Box 89000
                                 Baltimore, MD        Baltimore, MD
                                 21289-0220           21289-0300
     _________________________
     T. Rowe Price Trust 
     Company
     1-800-492-7670
     1-410-625-6585              Note: Redemptions from retirement accounts,
                                 including IRAs, must be in writing. Please
                                 call Shareholder Services to obtain an IRA 
                                 Distribution Request Form. For
                                 employer-sponsored retirement accounts,
                                 call T. Rowe Price Trust Company or your
                                 plan administrator for instructions. 
     _______________________
     Shareholder Services
     1-800-225-5132
     1-410-625-6500              Shareholder Services

                                 Many services are available to you as a T.
                                 Rowe Price shareholder; some you receive
                                 automatically and others you must authorize
                                 on the New Account Form. By signing up for
                                 services on the New Account Form rather
                                 than later, you avoid having to complete a
                                 separate form and obtain a signature
                                 guarantee. This section reviews some of the
                                 principal services currently offered. Our
                                 Services Guide contains detailed
                                 descriptions of these and other services.  
                                 If you are a new T. Rowe Price investor, 
                                 you will receive a Services Guide with our
                                 Welcome Kit.  Note: Corporate and other
                                 institutional accounts require an original
                                 or certified resolution to establish
                                 services and to redeem by mail.  For more
                                 information, call Investor Services.
     
                                 Retirement Plans
                                 We offer a wide range of plans for
                                 individuals and institutions, including
                                 large and small businesses: IRAs, SEP-IRAs,
                                 Keoghs (profit sharing, money purchase
                                 pension), 401(k), and 403(b)(7). For 
                                 information on IRAs, call Investor
                                 Services. For information on all other 












                                 PAGE 6
                                 retirement plans, please call our Trust
                                 Company at 1-800-492-7670.
     _________________________
     Investor Services
     1-800-638-5660
     1-410-547-2308              Exchange Service

                                 You can move money from one account to an
                                 existing identically registered account, or
                                 open a new identically registered account. 
                                 Remember, exchanges are purchases and sales
                                 for tax purposes. (Exchanges into a state
                                 tax-free fund are limited to investors
                                 living in states where the funds are
                                 registered.) Some of the T. Rowe Price 
                                 funds may impose a redemption fee of .50%
                                 to 2%, payable to such funds, on shares
                                 held for less than one year, or in some
                                 funds, six months.

                                        
                                 Automated Services
                                    Tele*Access(registered trademark).
                                 24-hour service via toll-free number
                                 provides information on fund yields and
                                 prices, dividends, account balances, and
                                 your latest transaction as well as the
                                 ability to request prospectuses, account
                                 and tax forms, duplicate statements,
                                 checks, and to initiate purchase,
                                 redemption and exchange orders in your
                                 accounts (see "Electronic Transfers"
                                 below).    

                                 PC*Access(registered trademark).  24-hour
                                 service via dial-up modem provides the same
                                 information as Tele*Access, but on a
                                 personal computer.  Please call Investor
                                 Services for an information guide. 

                                 Telephone and Walk-In Services
                                    Buy, sell, or exchange shares by calling
                                 one of our service representatives or by 
                                 visiting one of our four investor center
                                 locations whose addresses are listed on the
                                 cover.    

                                 Electronic Transfers
                                 By ACH. With no charges to pay, you can 
                                 initiate a purchase or redemption for as
                                 little as $100 or as much as $100,000
                                 between your bank account and fund account
                                 using the ACH network.  Enter instructions 












                                 PAGE 7
                                 via Tele*Access (registered trademark),
                                 PC*Access (registered trademark) or call
                                 Shareholder Services.

                                 By Wire. Electronic transfers can also be
                                 conducted via bank wire. There is currently
                                 a $5 fee for wire redemptions under $5,000,
                                 and your bank may charge for incoming or
                                 outgoing wire transfers regardless of size.

                                    Checkwriting (Not available for Equity
                                 Funds, High Yield or Emerging Markets Bond
                                 Funds)
                                 You may write an unlimited number of free
                                 checks on any money market fund, and most
                                 bond funds, with a minimum of $500 per
                                 check.  Keep in mind, however that a check
                                 results in a redemption; a check written on
                                 a bond fund will create a taxable event
                                 which you and we must report to the
                                 IRS.    

                                 Automatic Investing ($50 minimum)
                                 You can invest automatically in several
                                 different ways, including: 

                                 o Automatic Asset Builder. You instruct us  
                                   to move $50 or more once a month or less 
                                   often from your bank account, or you can  
                                   instruct your employer to send all or a
                                   portion of your paycheck to the fund or  
                                   funds you designate.

                                 o Automatic Exchange. You can set up
                                   systematic investments from one fund 
                                   account into another, such as from a 
                                   money fund into a stock fund.

                                 Discount Brokerage
                                 You can trade stocks, bonds, options,
                                 precious metals, and other securities at a
                                 savings over regular commission rates. Call
                                 Investor Services for information.

                                 Note: If you buy or sell T. Rowe Price
                                 Funds through anyone other than T. Rowe
                                 Price, such as broker-dealers or banks, you
                                 may be charged transaction or service fees
                                 by those institutions. No such fees are
                                 charged by T. Rowe Price Investment
                                 Services or the fund for transactions
                                 conducted directly with the fund.

































































     PAGE 64                                 
                                             Prospectus

     To Open an Account
     Investor Services                       International
     1-800-638-5660                          Fixed Income
     1-410-547-2308                          Funds

     For Existing Accounts
     Shareholder Services   To help you         T. Rowe Price ______________
     1-800-225-5132         achieve your     International    A choice of
     1-410-625-6500         financial goals, Funds, Inc.      worldwide
                            T. Rowe Price    May 1, 1995      fixed-income
     For Yields & Prices    offers a wide                     funds for
     Tele*Access(registered range of stock,                   investors
     trademark)             bond, and money                   seeking a
     1-800-638-2587         market                            combination of
     1-410-625-7676         investments, as                   high current
     24 hours, 7 days       well as                           income,
                            convenient                        diversifica-
     Investor Centers       services and                      tion, and
                            timely,                           capital
     101 East Lombard St.   informative                       appreciation
     Baltimore, MD          reports.                          from foreign
                                                              and U.S. debt
     T. Rowe Price                                            securities.
     Financial Center                                             
     10090 Red Run Blvd.
     Owings Mills, MD

     Farragut Square
     900 17th Street, N.W.
     Washington, DC

     ARCO Tower
     31st Floor
     515 South Flower St.                    T. Rowe Price
     Los Angeles, CA                         Invest With
                                             Confidence
                                             (registered
                                             trademark)

























          PAGE 65
                         STATEMENT OF ADDITIONAL INFORMATION

             T. Rowe Price International Funds, Inc. (the "Corporation")

                            Short-Term Global Income Fund
                             Global Government Bond Fund
                               International Bond FundR
                              Emerging Markets Bond Fund

                                    (the "Funds")


                This Statement of Additional Information is not a
          prospectus but should be read in conjunction with the Fund's
          prospectus dated May 1, 1995, which may be obtained from T. Rowe
          Price Investment Services, Inc., 100 East Pratt Street,
          Baltimore, Maryland 21202.

             The date of this Statement of Additional Information is May 1,
          1995.    













































          PAGE 66
                                  TABLE OF CONTENTS

                                   Page                              Page

          Call and Put Options  . . .     Legal Counsel . . . . . . . .
          Capital Stock . . . . . . .     Lending of Portfolio
          Code of Ethics  . . . . . .      Securities . . . . . . . . .
          Custodian . . . . . . . . .     Management of Funds . . . . .
          Dealers Options . . . . . .     Net Asset Value Per Share . .
          Distributor for Funds . . .     Portfolio Management
          Dividends . . . . . . . . .      Practices  . . . . . . . . .
          Federal and State Registration  Portfolio Transactions  . . .
            of Shares . . . . . . . .     Pricing of Securities . . . .
          Foreign Currency                Principal Holders of
           Transactions . . . . . . .      Securities . . . . . . . . .
          Foreign Futures and             Ratings of Corporate Debt
           Options  . . . . . . . . .      Securities . . . . . . . . .
          Futures Contracts . . . . .     Repurchase Agreements . . . .
          Hybrid Instruments  . . . .     Risk Factors of Foreign
          Illiquid or Restricted           Investing  . . . . . . . . .
           Securities . . . . . . . .     Risk Factors of Investing in
          Independent Accountants . .      Debt Obligations . . . . . .
          Investment Management           Tax Status  . . . . . . . . .
           Services . . . . . . . . .     Taxation of Foreign
          Investment Objectives and        Shareholders . . . . . . . .
           Policies . . . . . . . . .     When-Issued Securities and
          Investment Performance  . .      Forward Commitment
          Investment Programs . . . .      Contracts  . . . . . . . . .
          Investment Restrictions . .     Yield Information . . . . . .


                          INVESTMENT OBJECTIVES AND POLICIES

             The following information supplements the discussion of each
          Fund's investment objectives and policies discussed in the
          prospectus.  Unless otherwise specified, the investment program
          and restrictions of each Fund are not fundamental policies.  The
          operating policies of each Fund are subject to change by its
          Board of Directors without shareholder approval.  However,
          shareholders will be notified of a material change in an
          operating policy.  The fundamental policies of each Fund may not
          be changed without the approval of at least a majority of the
          outstanding shares of each Fund or, if it is less, 67% of the
          shares represented at a meeting of shareholders at which the
          holders of 50% or more of the shares are represented.




















          PAGE 67
                                 INVESTMENT PROGRAMS

          All Funds

             The Funds' investment manager, Rowe Price-Fleming
          International, Inc. ("Price-Fleming"), one of America's largest
          managers of no-load international mutual fund assets, regularly
          analyzes a broad range of international equity and fixed income
          markets in order to assess the degree of risk and level of return
          that can be expected from each market.  Based upon its current
          assessment, Price-Fleming believes a high level of current income
          may be achieved by investing in high quality international fixed
          income securities, high quality, short-term U.S. and foreign
          fixed income securities, or high quality U.S. and foreign
          government bonds.  Of course, there can be no assurance that
          Price-Fleming's forecasts of expected return will be reflected in
          the actual returns achieved by the Funds.

             Each Fund's share price will fluctuate with market, economic
          and foreign exchange conditions, and your investment may be worth
          more or less when redeemed than when purchased.  The Funds should
          not be relied upon as a complete investment program, nor used to
          play short-term swings in the global bond or foreign exchange
          markets.  The Funds are subject to risks unique to international
          investing.  See discussion under "Risk Factors of Foreign
          Investing" beginning on page ___.  Further, there is no assurance
          that the favorable trends discussed below will continue, and the
          Funds cannot guarantee they will achieve their objectives.

                          Risk Factors of Foreign Investing

             There are special risks in investing in the Funds.  Certain of
          these risks are inherent in any international mutual fund while
          others relate more to the countries in which the Funds will
          invest.  Many of the risks are more pronounced for investments in
          developing or emerging countries, such as many of the countries
          of Southeast Asia, Latin America, Eastern Europe and the Middle
          East.  Although there is no universally accepted definition, a
          developing country is generally considered to be a country which
          is in the initial stages of its industrialization cycle with a
          per capita gross national product of less than $8,000.

             General.  Investors should understand that all investments
          have a risk factor.  There can be no guarantee against loss
          resulting from an investment in the Funds, and there can be no
          assurance that the Funds' investment policies will be successful,
          or that its investment objectives will be attained.  The Funds 


















          PAGE 68
          are designed for individual and institutional investors seeking
          to diversify beyond the United States in actively researched and
          managed portfolios, and are intended for long-term investors who
          can accept the risks entailed in investment in foreign
          securities.

             Political and Economic Factors.  Individual foreign economies
          of certain countries may differ favorably or unfavorably from the
          United States' economy in such respects as growth of gross
          national product, rate of inflation, capital reinvestment,
          resource self-sufficiency and balance of payments position.  The
          internal politics of certain foreign countries are not as stable
          as in the United States.  For example, in 1991, the existing
          government in Thailand was overthrown in a military coup.  In
          1992, there were two military coup attempts in Venezuela and in
          1992 the President of Brazil was impeached.  In addition,
          significant external political risks currently affect some
          foreign countries.  Both Taiwan and China still claim sovereignty
          of one another and there is a demilitarized border between North
          and South Korea.

             Governments in certain foreign countries continue to
          participate to a significant degree, through ownership interest
          or regulation, in their respective economies.  Action by these
          governments could have a significant effect on market prices of
          securities and payment of dividends.  The economies of many
          foreign countries are heavily dependent upon international trade
          and are accordingly affected by protective trade barriers and
          economic conditions of their trading partners.  The enactment by
          these trading partners of protectionist trade legislation could
          have a significant adverse effect upon the securities markets of
          such countries.

             Currency Fluctuations.  The Funds will invest in securities
          denominated in various currencies.  Accordingly, a change in the
          value of any such currency against the U.S. dollar will result in
          a corresponding change in the U.S. dollar value of the Funds'
          assets denominated in that currency.  Such changes will also
          affect the Funds' income.  Generally, when a given currency
          appreciates against the dollar (the dollar weakens) the value of
          the Fund's securities denominated in that currency will rise. 
          When a given currency depreciates against the dollar (the dollar
          strengthens) the value of the Funds' securities denominated in
          that currency would be expected to decline.

             Investment and Repatriation of Restrictions.  Foreign
          investment in the securities markets of certain foreign countries


















          PAGE 69
          is restricted or controlled in varying degrees.  These
          restrictions may limit at times and preclude investment in
          certain of such countries and may increase the cost and expenses
          of the Funds.  Investments by foreign investors are subject to a
          variety of restrictions in many developing countries.  These
          restrictions may take the form of prior governmental approval,
          limits on the amount or type of securities held by foreigners,
          and limits on the types of companies in which foreigners may
          invest.  Additional or different restrictions may be imposed at
          any time by these or other countries in which the Funds invest. 
          In addition, the repatriation of both investment income and
          capital from several foreign countries is restricted and
          controlled under certain regulations, including in some cases the
          need for certain government consents.  For example, capital
          invested in Chile normally cannot be repatriated for one year.

             Market Characteristics.  It is contemplated that most foreign
          securities, other than Latin American securities, will be
          purchased in over-the-counter markets or on stock exchanges
          located in the countries in which the respective principal
          offices of the issuers of the various securities are located, if
          that is the best available market.  Currently, it is anticipated
          that many Latin American investments will be made through ADRs
          traded in the United States.  Foreign stock markets are generally
          not as developed or efficient as, and may be more volatile than,
          those in the United States.  While growing in volume, they
          usually have substantially less volume than U.S. markets and the
          Funds' portfolio securities may be less liquid and subject to
          more rapid and erratic price movements than securities of
          comparable U.S. companies.  Equity securities may trade at
          price/earnings multiples higher than comparable United States
          securities and such levels may not be sustainable.  Fixed
          commissions on foreign stock exchanges are generally higher than
          negotiated commissions on United States exchanges, although the
          Funds will endeavor to achieve the most favorable net results on
          their portfolio transactions.  There is generally less government
          supervision and regulation of foreign stock exchanges, brokers
          and listed companies than in the United States.  Moreover,
          settlement practices for transactions in foreign markets may
          differ from those in United States markets.  Such differences may
          include delays beyond periods customary in the United States and
          practices, such as delivery of securities prior to receipt of
          payment, which increase the likelihood of a "failed settlement." 
          Failed settlements can result in losses to a Fund.

             Investment Funds.  The Funds may invest in investment funds
          which have been authorized by the governments of certain 


















          PAGE 70
          countries specifically to permit foreign investment in securities
          of companies listed and traded on the stock exchanges in these
          respective countries.  The Funds' investment in these funds is
          subject to the provisions of the 1940 Act discussed on page 28. 
          If the Funds invest in such investment funds, the Funds'
          shareholders will bear not only their proportionate share of the
          expenses of the Funds (including operating expenses and the fees
          of the investment manager), but also will bear indirectly similar
          expenses of the underlying investment funds.  In addition, the
          securities of these investment funds may trade at a premium over
          their net asset value.

             Information and Supervision.  There is generally less publicly
          available information about foreign companies comparable to
          reports and ratings that are published about companies in the
          United States.  Foreign companies are also generally not subject
          to uniform accounting, auditing and financial reporting
          standards, practices and requirements comparable to those
          applicable to United States companies.  It also may be more
          difficult to keep currently informed of corporate actions which
          affect the prices of portfolio securities.

             Taxes.  The dividends and interest payable on certain of the
          Funds' foreign portfolio securities may be subject to foreign
          withholding taxes, thus reducing the net amount of income
          available for distribution to the Funds' shareholders.  A
          shareholder otherwise subject to United States federal income
          taxes may, subject to certain limitations, be entitled to claim a
          credit or deduction for U.S. federal income tax purposes for his
          or her proportionate share of such foreign taxes paid by the
          Funds.  (See "Tax Status," page ___.)

             Costs.  Investors should understand that the expense ratios of
          the Funds can be expected to be higher than investment companies
          investing in domestic securities since the cost of maintaining
          the custody of foreign securities and the rate of advisory fees
          paid by the Funds are higher.  

             Small Companies.  Small companies may have less experienced
          management and fewer management resources than larger firms.  A
          smaller company may have greater difficulty obtaining access to
          capital markets, and may pay more for the capital it obtains.  In
          addition, smaller companies are more likely to be involved in
          fewer market segments, making them more vulnerable to any
          downturn in a given segment.  Some of these factors may also
          apply, to a lesser extent, to medium size companies.  Some of the
          smaller companies in which the Funds will invest may be in major 


















          PAGE 71
          foreign markets; others may be leading companies in emerging
          countries outside the major foreign markets.  Securities analysts
          generally do not follow such securities, which are seldom held
          outside of their respective countries and which may have
          prospects for long-term investment returns superior to the
          securities of well-established and well-known companies.  Direct
          investment in such securities may be difficult for United States
          investors because, among other things, information relating to
          such securities is often not readily available.  Of course, there
          are also risks associated with such investments, and there is no
          assurance that such prospects will be realized.  

             Other.  With respect to certain foreign countries, especially
          developing and emerging ones, there is the possibility of adverse
          changes in investment or exchange control regulations,
          expropriation or confiscatory taxation, limitations on the
          removal of funds or other assets of the Funds, political or
          social instability, or diplomatic developments which could affect
          investments by U.S. persons in those countries.

          Emerging Market Investing

             Eastern Europe and Russia.  Changes occurring in Eastern
          Europe and Russia today could have long-term potential
          consequences.  As restrictions fall, this could result in rising
          standards of living, lower manufacturing costs, growing consumer
          spending, and substantial economic growth.  However, investment
          in the countries of Eastern Europe and Russia is highly
          speculative at this time.  Political and economic reforms are too
          recent to establish a definite trend away from centrally-planned
          economies and state owned industries.  In many of the countries
          of Eastern Europe and Russia, there is no stock exchange or
          formal market for securities.  Such countries may also have
          government exchange controls, currencies with no recognizable
          market value relative to the established currencies of western
          market economies, little or no experience in trading in
          securities, no financial reporting standards, a lack of a banking
          and securities infrastructure to handle such trading, and a legal
          tradition which does not recognize rights in private property. 
          In addition, these countries may have national policies which
          restrict investments in companies deemed sensitive to the
          country's national interest.  Further, the governments in such
          countries may require governmental or quasi-governmental
          authorities to act as custodian of a Fund's assets invested in
          such countries and these authorities may not qualify as a foreign
          custodian under the Investment Company Act of 1940 and exemptive
          relief from such Act may be required.  All of these 


















          PAGE 72
          considerations are among the factors which could cause
          significant risks and uncertainties to investment in Eastern
          Europe and Russia.  Each Fund will only invest in a company
          located in, or a government of, Eastern Europe and Russia, if it
          believes the potential return justifies the risk.

          Latin America

             The political history of certain Latin American countries has
          been characterized by political uncertainty, intervention by the
          military in civilian and economic spheres, and political
          corruption.  Such developments, if they were to reoccur, could
          reverse favorable trends toward market and economic reform,
          privatization and removal of trade barriers and result in
          significant disruption in securities markets.  Persistent levels
          of inflation or in some cases, hyperinflation, have led to high 
          interest rates, extreme measures by governments to keep inflation
          in check and a generally debilitating effect on economic growth. 
          Although inflation in many countries has lessened, there is no
          guarantee it will remain at lower levels.  In addition, a number
          of Latin American countries are also among the largest debtors of
          developing countries.  There have been moratoria on, and
          reschedulings of, repayment with respect to these debts.  Such
          events can restrict the flexibility of these debtor nations in
          the international markets and result in the imposition of onerous
          conditions on their economies.

             Certain Latin American countries may have managed currencies
          which are maintained at artificial levels to the U.S. dollar
          rather than at levels determined by the market.  This type of
          system can lead to sudden and large adjustments in the currency
          which, in turn, can have a disruptive and negative effect on
          foreign investors.  Certain Latin American countries also may
          restrict the free conversion of their currency into foreign
          currencies, including the U.S. dollar.  There is no significant
          foreign exchange market for certain currencies and it would, as a
          result, be difficult for the Fund to engage in foreign currency
          transactions designed to protect the value of the Fund's
          interests in securities denominated in such currencies.

                    Risk Factors of Investing in Debt Obligations

             Because of their investment policies, the Bond Funds may or
          may not be suitable or appropriate for all investors.  The Funds 
          are not money market funds and are not appropriate investments
          for those whose primary objective is principal stability.  There
          is risk in all investment.  The Short-Term Global Income Fund is 


















          PAGE 73
          designed for the investor, who is willing to accept the risks of
          international investing in seeking to participate in a
          diversified portfolio of U.S. and foreign government short-term
          high quality bonds and other debt securities which provide
          greater stability in the rate of income than a money market fund
          (average weighted maturity of less than 90 days) and less risk of
          capital fluctuation than a portfolio of long-term debt
          securities.  The value of the portfolio securities of each Fund
          will fluctuate based upon market, economic and foreign exchange
          conditions.  Although each Fund seeks to reduce risk by investing
          in a diversified portfolio, such diversification does not
          eliminate all risk.  There can, of course, be no assurance that
          the Funds will achieve these results.

             Yields on short, intermediate, and long-term securities are
          dependent on a variety of factors, including the general
          conditions of the money, bond and foreign exchange markets, the
          size of a particular offering,the maturity of the obligation, and
          the rating of the issue.  Debt securities with longer maturities
          tend to produce higher yields and are generally subject to
          potentially greater capital appreciation and depreciation than
          obligations with shorter maturities and lower yields.  The market
          prices of debt securities usually vary, depending upon available
          yields.  An increase in interest rates will generally reduce the
          value of portfolio investments, and a decline in interest rates
          will generally increase the value of portfolio investments.  The
          ability of each Fund to achieve its investment objective is also
          dependent on the continuing ability of the issuers of the debt
          securities in which each Fund invests to meet their obligations
          for the payment of interest and principal when due.

             After purchase by a Fund, a security may cease to be rated or
          its rating may be reduced below the minimum required for purchase
          by the Fund.  Neither event will require a sale of such security
          by a Fund.  However, Price-Fleming will consider such event in
          its determination of whether a Fund should continue to hold the
          security.  To the extent that the ratings given by Moody's
          Investors Service, Inc. ("Moody's") and Standard & Poor's
          Corporation ("S&P") may change as a result of changes in such
          organizations or their rating systems, the Funds will attempt to
          use comparable ratings as standards for investments in accordance
          with the investment policies contained in the prospectus.

          Special Risks of High Yield ("Junk Bond") Investing  

             Junk bonds are regarded as predominantly speculative with
          respect to the issuer's continuing ability to meet principal and 


















          PAGE 74
          interest payments.  Because investment in low and lower-medium
          quality bonds involves greater investment risk, to the extent the
          Fund invests in such bonds, achievement of its investment
          objective will be more dependent on Price-Fleming's credit
          analysis than would be the case if the Fund was investing in
          higher quality bonds.  High yield bonds may be more susceptible
          to real or perceived adverse economic conditions than investment
          grade bonds.  A projection of an economic downturn, or higher
          interest rates, for example, could cause a decline in high yield
          bond prices because the advent of such events could lessen the
          ability of highly leverage issuers to make principal and interest
          payments on their debt securities.

             Because the market for lower rated securities may be thinner
          and less active than for higher rated securities, there may be
          market price volatility for these securities and limited
          liquidity in the resale market.  Nonrated securities are usually
          not as attractive to as many buyers as rated securities are, a
          factor which may make nonrated securities less marketable.  These
          factors may have the effect of limiting the availability of the
          securities for purchase by the Fund and may also limit the
          ability of the Fund to sell such securities at their fair value
          either to meet redemption requests or in response to changes in
          the economy or the financial markets.  Adverse publicity and
          investor perceptions, whether or not based on fundamental
          analysis, may decrease the values and liquidity of lower rated
          debt securities, especially in a thinly traded market.  To the
          extent the Fund owns or may acquire illiquid or restricted lower
          rated securities, these securities may involve special
          registration responsibilities, liabilities and costs, and
          liquidity and valuation difficulties.  Changes in values of
          debt securities which the Fund owns will affect its net asset
          value per share.  If market quotations are not readily available
          for the Fund's lower rated or nonrated securities, these
          securities will be valued by a method that the Fund's Board of
          Directors believes accurately reflects fair value.  Judgment
          plays a greater role in valuing lower rated debt securities than
          with respect to securities for which more external sources of
          quotations and last sale information are available.

             In addition to the investments described in the Funds'
          prospectus, the Funds may invest in the following:























          PAGE 75
                                 Types of Securities

          Hybrid Instruments

                Hybrid Instruments (a type of potentially high risk
          derivative) have recently been developed and combine the elements
          of futures contracts or options with those of debt, preferred
          equity or a depository instrument (hereinafter "Hybrid
          Instruments").  Often these Hybrid Instruments are indexed to the
          price of a commodity, particular currency, or a domestic or
          foreign debt or equity securities index.  Hybrid Instruments may
          take a variety of forms, including, but not limited to, debt
          instruments with interest or principal payments or redemption
          terms determined by reference to the value of a currency or
          commodity or securities index at a future point in time,
          preferred stock with dividend rates determined by reference to
          the value of a currency, or convertible securities with the
          conversion terms related to a particular commodity.

             The risks of investing in Hybrid Instruments reflect a
          combination of the risks from investing in securities, options,
          futures and currencies, including volatility and lack of
          liquidity.  Reference is made to the discussion of futures,
          options, and forward contracts herein for a discussion of these
          risks.  Further, the prices of the Hybrid Instrument and the
          related commodity or currency may not move in the same direction
          or at the same time.  Hybrid Instruments may bear interest or pay
          preferred dividends at below market (or even relatively nominal)
          rates.  Alternatively, Hybrid Instruments may bear interest at
          above market rates but bear an increased risk of principal loss
          (or gain).  In addition, because the purchase and sale of Hybrid
          Instruments could take place in an over-the-counter market or in
          a private transaction between the Fund and the seller of the
          Hybrid Instrument, the creditworthiness of the contra party to
          the transaction would be a risk factor which the Fund would have
          to consider.  Hybrid Instruments also may not be subject to
          regulation of the Commodities Futures Trading Commission
          ("CFTC"), which generally regulates the trading of commodity
          futures by U.S. persons, the SEC, which regulates the offer and
          sale of securities by and to U.S. persons, or any other
          governmental regulatory authority.

                          Illiquid or Restricted Securities

             Restricted securities may be sold only in privately negotiated
          transactions or in a public offering with respect to which a
          registration statement is in effect under the Securities Act of 


















          PAGE 76
          1933 (the "1933 Act").  Where registration is required, the Fund
          may be obligated to pay all or part of the registration expenses
          and a considerable period may elapse between the time of the
          decision to sell and the time the Fund may be permitted to sell a
          security under an effective registration statement.  If, during
          such a period, adverse market conditions were to develop, the
          Fund might obtain a less favorable price than prevailed when it
          decided to sell.  Restricted securities will be priced at fair
          value as determined in accordance with procedures prescribed by
          the Fund's Board of Directors/Trustees.  If through the
          appreciation of illiquid securities or the depreciation of liquid
          securities, the Fund should be in a position where more than 15%
          of the value of its net assets are invested in illiquid assets,
          including restricted securities, the Fund will take appropriate
          steps to protect liquidity.

             Notwithstanding the above, the Fund may purchase securities
          which, while privately placed, are eligible for purchase and sale
          under Rule 144A under the 1933 Act.  This rule permits certain
          qualified institutional buyers, such as the Fund, to trade in
          privately placed securities even though such securities are not
          registered under the 1933 Act.  Price-Fleming under the
          supervision of the Fund's Board of Directors/Trustees, will
          consider whether securities purchased under Rule 144A are
          illiquid and thus subject to the Fund's restriction of investing
          no more than 15% of its net assets in illiquid securities.  A
          determination of whether a Rule 144A security is liquid or not is
          a question of fact.  In making this determination, Price-Fleming
          will consider the trading markets for the specific security
          taking into account the unregistered nature of a Rule 144A
          security.  In addition, Price-Fleming could consider the (1)
          frequency of trades and quotes, (2) number of dealers and
          potential purchases, (3) dealer undertakings to make a market,
          and (4) the nature of the security and of marketplace trades
          (e.g., the time needed to dispose of the security, the method of
          soliciting offers and the mechanics of transfer).  The liquidity
          of Rule 144A securities would be monitored, and if as a result of
          changed conditions it is determined that a Rule 144A security is
          no longer liquid, the Fund's holdings of illiquid securities
          would be reviewed to determine what, if any, steps are required
          to assure that the Fund does not invest more than 15% of its net
          assets in illiquid securities.  Investing in Rule 144A securities
          could have the effect of increasing the amount of the Fund's
          assets invested in illiquid securities if qualified institutional
          buyers are unwilling to purchase such securities.




















          PAGE 77
          Short-Term Global Income and Global Government Bond Funds

             The securities of U.S. issuers in which both Funds may invest
          include, but are not limited to, the following:

             U.S. Government Obligations.  Debt securities issued by the
          U.S. Treasury.  These are direct obligations of the U.S.
          Government and differ mainly in the length of their maturities.

             U.S. Government Agency Securities.  Issued or guaranteed by
          U.S. Government sponsored enterprises and federal agencies. 
          These include securities issued by the Federal National Mortgage
          Association, Government National Mortgage Association, Federal
          Home Loan Bank, Federal Land Banks, Farmers Home Administration,
          Banks for Cooperatives, Federal Intermediate Credit Banks,
          Federal Financing Bank, Farm Credit Banks, the Small Business
          Association, and the Tennessee Valley Authority.  Some of these
          securities are supported by the full faith and credit of the U.S.
          Treasury, and the remainder are supported only by the credit of
          the instrumentality, which may or may not include the right of
          the issuer to borrow from the Treasury.

             Bank Obligations.  Certificates of deposit, bankers'
          acceptances, and other short-term debt obligations.  Certificates
          of deposit are short-term obligations of commercial banks.  A
          bankers' acceptance is a time draft drawn on a commercial bank by
          a borrower, usually in connection with international commercial
          transactions.  Certificates of deposit may have fixed or variable
          rates.

             Savings and Loan Obligations.  Negotiable certificates of
          deposit and other short-term debt obligations of savings and loan
          associations.

             Collateralized Mortgage Obligations (CMOs).  CMOs are
          obligations fully collateralized by a portfolio of mortgages or
          mortgage-related securities.  Payments of principal and interest
          on the mortgages are passed through to the holders of the CMOs on
          the same schedule as they are received, although certain classes
          of CMOs have priority over others with respect to the receipt of
          prepayments on the mortgages.  Therefore, depending on the type
          of CMOs in which a Fund invests, the investment may be subject to
          a greater or lesser risk of prepayment than other types of
          mortgage-related securities.

             Asset Backed Receivables.  The asset-backed securities that
          may be purchased include, but are not limited to, Certificates 


















          PAGE 78
          for Automobile Receivables (CARSsm) and Credit Card Receivable
          Securities.  CARSsm represent undivided fractional interests in a
          trust whose assets consist of a pool of motor vehicle retail
          installment sales contracts and security interests in the
          vehicles securing these contracts.  In addition to the general
          risks pertaining to all asset-backed securities, CARSsm are
          subject to the risks of delayed payments or losses if the full
          amounts due on underlying sales contracts are not realized by the
          trust due to unanticipated legal or administrative costs of
          enforcing the contracts, or due to depreciation, damage or loss
          of the vehicles securing the contracts.  Credit Card Receivable
          Securities are backed by receivables from revolving credit card
          accounts.  Since balances on revolving credit card accounts are
          generally paid down more rapidly than CARSsm, issuers often
          lengthen the maturity of these securities by providing for a
          fixed period during which interest payments are passed through
          and principal payments are used to fund the transfer of
          additional receivables to the underlying pool.  The failure of
          the underlying receivables to generate principal payments may
          therefore shorten the maturity of these securities.  In addition,
          unlike most other asset-backed securities, Credit Card Receivable
          Securities are backed by obligations that are not secured by an
          interest in personal or real property.

             There are, of course, other types of securities that are, or
          may become available, which are similar to the foregoing and the
          Fund may invest in these securities.

                            Portfolio Management Practices

                           Lending of Portfolio Securities

             Securities loans are made to broker-dealers or institutional
          investors or other persons, pursuant to agreements requiring that
          the loans be continuously secured by collateral at least equal at
          all times to the value of the securities lent marked to market on
          a daily basis.  The collateral received will consist of cash,
          U.S. government securities, letters of credit or such other
          collateral as may be permitted under its investment program. 
          While the securities are being lent, the Fund will continue to
          receive the equivalent of the interest or dividends paid by the
          issuer on the securities, as well as interest on the investment
          of the collateral or a fee from the borrower.  The Fund has a
          right to call each loan and obtain the securities on five
          business days' notice or, in connection with securities trading
          on foreign markets, within such longer period of time which
          coincides with the normal settlement period for purchases and 


















          PAGE 79
          sales of such securities in such foreign markets.  The Fund will
          not have the right to vote securities while they are being lent,
          but it will call a loan in anticipation of any important vote. 
          The risks in lending portfolio securities, as with other
          extensions of secured credit, consist of possible delay in
          receiving additional collateral or in the recovery of the
          securities or possible loss of rights in the collateral should
          the borrower fail financially.  Loans will only be made to firms
          deemed by Price-Fleming to be of good standing and will not be
          made unless, in the judgment of Price-Fleming, the consideration
          to be earned from such loans would justify the risk.

          Other Lending/Borrowing

               Subject to approval by the Securities and Exchange
          Commission and certain state regulatory agencies, the Fund may
          make loans to, or borrow funds from, other mutual funds sponsored
          or advised by T. Rowe Price or Price-Fleming (collectively,
          "Price Funds").  The Fund has no current intention of engaging in
          these practices at this time.

                                Repurchase Agreements

             The Fund may enter into a repurchase agreement through which
          an investor (such as the Fund) purchases a security (known as the
          "underlying security") from a well-established securities dealer
          or a bank that is a member of the Federal Reserve System.  Any
          such dealer or bank will be on Price-Fleming's approved list and
          have a credit rating with respect to its short-term debt of at
          least A1 by Standard & Poor's Corporation, P1 by Moody's
          Investors Service, Inc., or the equivalent rating by Price-
          Fleming. At that time, the bank or securities dealer agrees to
          repurchase the underlying security at the same price, plus
          specified interest.  Repurchase agreements are generally for a
          short period of time, often less than a week.  Repurchase
          agreements which do not provide for payment within seven days
          will be treated as illiquid securities.  The Fund will only enter
          into repurchase agreements where (i) the underlying securities
          are of the type (excluding maturity limitations) which the Fund's
          investment guidelines would allow it to purchase directly, (ii)
          the market value of the underlying security, including interest
          accrued, will be at all times equal to or exceed the value of the
          repurchase agreement, and (iii) payment for the underlying
          security is made only upon physical delivery or evidence of book-
          entry transfer to the account of the custodian or a bank acting
          as agent.  In the event of a bankruptcy or other default of a
          seller of a repurchase agreement, the Fund could experience both


















          PAGE 80
          delays in liquidating the underlying security and losses,
          including: (a) possible decline in the value of the underlying
          security during the period while the Fund seeks to enforce its
          rights thereto; (b) possible subnormal levels of income and lack
          of access to income during this period; and (c) expenses of
          enforcing its rights.

                                       Options

             
    
   Options are a type of potentially high risk derivative.    

                             Writing Covered Call Options

             The Fund may write (sell) American or European style "covered"
          call options and purchase options to close out options previously
          written by a Fund.  In writing covered call options, the Fund
          expects to generate additional premium income which should serve
          to enhance the Fund's total return and reduce the effect of any
          price decline of the security or currency involved in the option. 
          Covered call options will generally be written on securities or
          currencies which, in Price-Fleming's opinion, are not expected to
          have any major price increases or moves in the near future but
          which, over the long term, are deemed to be attractive
          investments for the Fund.

             A call option gives the holder (buyer) the "right to purchase"
          a security or currency at a specified price (the exercise price)
          at expiration of the option (European style) or at any time until
          a certain date (the expiration date) (American style).  So long
          as the obligation of the writer of a call option continues, he
          may be assigned an exercise notice by the broker-dealer through
          whom such option was sold, requiring him to deliver the
          underlying security or currency against payment of the exercise
          price.  This obligation terminates upon the expiration of the
          call option, or such earlier time at which the writer effects a
          closing purchase transaction by repurchasing an option identical
          to that previously sold.  To secure his obligation to deliver the
          underlying security or currency in the case of a call option, a
          writer is required to deposit in escrow the underlying security
          or currency or other assets in accordance with the rules of a
          clearing corporation.

             The Fund will write only covered call options.  This means
          that the Fund will own the security or currency subject to the
          option or an option to purchase the same underlying security or
          currency, having an exercise price equal to or less than the
          exercise price of the "covered" option, or will establish and 


















          PAGE 81
          maintain with its custodian for the term of the option, an
          account consisting of cash, U.S. government securities or other
          liquid high-grade debt obligations having a value equal to the
          fluctuating market value of the optioned securities or
          currencies.

             Portfolio securities or currencies on which call options may
          be written will be purchased solely on the basis of investment
          considerations consistent with the Fund's investment objective. 
          The writing of covered call options is a conservative investment
          technique believed to involve relatively little risk (in contrast
          to the writing of naked or uncovered options, which the Fund will
          not do), but capable of enhancing the Fund's total return.  When
          writing a covered call option, a Fund, in return for the premium,
          gives up the opportunity for profit from a price increase in the
          underlying security or currency above the exercise price, but
          conversely retains the risk of loss should the price of the
          security or currency decline.  Unlike one who owns securities or
          currencies not subject to an option, the Fund has no control over
          when it may be required to sell the underlying securities or
          currencies, since it may be assigned an exercise notice at any
          time prior to the expiration of its obligation as a writer.  If a
          call option which the Fund has written expires, the Fund will
          realize a gain in the amount of the premium; however, such gain
          may be offset by a decline in the market value of the underlying
          security or currency during the option period.  If the call
          option is exercised, the Fund will realize a gain or loss from
          the sale of the underlying security or currency.  The Fund does
          not consider a security or currency covered by a call to be
          "pledged" as that term is used in the Fund's policy which limits
          the pledging or mortgaging of its assets.

             The premium received is the market value of an option.  The
          premium the Fund will receive from writing a call option will
          reflect, among other things, the current market price of the
          underlying security or currency, the relationship of the exercise
          price to such market price, the historical price volatility of
          the underlying security or currency, and the length of the option
          period.  Once the decision to write a call option has been made,
          Price-Fleming, in determining whether a particular call option
          should be written on a particular security or currency, will
          consider the reasonableness of the anticipated premium and the
          likelihood that a liquid secondary market will exist for those
          options.  The premium received by the Fund for writing covered
          call options will be recorded as a liability of the Fund.  This
          liability will be adjusted daily to the option's current market
          value, which will be the latest sale price at the time at which 


















          PAGE 82
          the net asset value per share of the Fund is computed (close of
          the New York Stock Exchange), or, in the absence of such sale,
          the latest asked price.  The option will be terminated upon
          expiration of the option, the purchase of an identical option in
          a closing transaction, or delivery of the underlying security or
          currency upon the exercise of the option.

             Closing transactions will be effected in order to realize a
          profit on an outstanding call option, to prevent an underlying
          security or currency from being called, or, to permit the sale of
          the underlying security or currency.  Furthermore, effecting a
          closing transaction will permit the Fund to write another call
          option on the underlying security or currency with either a
          different exercise price or expiration date or both.  If the Fund
          desires to sell a particular security or currency from its
          portfolio on which it has written a call option, or purchased a
          put option, it will seek to effect a closing transaction prior
          to, or concurrently with, the sale of the security or currency. 
          There is, of course, no assurance that the Fund will be able to
          effect such closing transactions at favorable prices.  If the
          Fund cannot enter into such a transaction, it may be required to
          hold a security or currency that it might otherwise have sold. 
          When the Fund writes a covered call option, it runs the risk of
          not being able to participate in the appreciation of the
          underlying securities or currencies above the exercise price, as
          well as the risk of being required to hold on to securities or
          currencies that are depreciating in value. This could result in
          higher transaction costs.  The Fund will pay transaction costs in
          connection with the writing of options to close out previously
          written options.  Such transaction costs are normally higher than
          those applicable to purchases and sales of portfolio securities.

             Call options written by the Fund will normally have expiration
          dates of less than nine months from the date written.  The
          exercise price of the options may be below, equal to, or above
          the current market values of the underlying securities or
          currencies at the time the options are written.  From time to
          time, the Fund may purchase an underlying security or currency
          for delivery in accordance with an exercise notice of a call
          option assigned to it, rather than delivering such security or
          currency from its portfolio.  In such cases, additional costs may
          be incurred.

             The Fund will realize a profit or loss from a closing purchase
          transaction if the cost of the transaction is less or more than
          the premium received from the writing of the option.  Because
          increases in the market price of a call option will generally 


















          PAGE 83
          reflect increases in the market price of the underlying security
          or currency, any loss resulting from the repurchase of a call
          option is likely to be offset in whole or in part by appreciation
          of the underlying security or currency owned by the Fund.

             In order to comply with the requirements of several states,
          the Fund will not write a covered call option if, as a result,
          the aggregate market value of all portfolio securities or
          currencies covering call or put options exceeds 25% of the market
          value of the Fund's net assets.  Should these state laws change
          or should the Fund obtain a waiver of its application, the Fund
          reserves the right to increase this percentage.  In calculating
          the 25% limit, the Fund will offset, against the value of assets
          covering written calls and puts, the value of purchased calls and
          puts on identical securities or currencies with identical
          maturity dates.

                             Writing Covered Put Options

             The Fund may write American or European style covered put
          options and purchase options to close out options previously
          written by the Fund.  A put option gives the purchaser of the
          option the right to sell, and the writer (seller) has the
          obligation to buy, the underlying security or currency at the
          exercise price during the option period (American style) or at
          the expiration of the option (European style).  So long as the
          obligation of the writer continues, he may be assigned an
          exercise notice by the broker-dealer through whom such option was
          sold, requiring him to make payment of the exercise price against
          delivery of the underlying security or currency.  The operation
          of put options in other respects, including their related risks
          and rewards, is substantially identical to that of call options.

             The Fund would write put options only on a covered basis,
          which means that the Fund would maintain in a segregated account
          cash, U.S. government securities or other liquid high-grade debt
          obligations in an amount not less than the exercise price or the
          Fund will own an option to sell the underlying security or
          currency subject to the option having an exercise price equal to
          or greater than the exercise price of the "covered" option at all
          times while the put option is outstanding.  (The rules of a
          clearing corporation currently require that such assets be
          deposited in escrow to secure payment of the exercise price.) 
          The Fund would generally write covered put options in
          circumstances where Price-Fleming wishes to purchase the
          underlying security or currency for the Fund's portfolio at a
          price lower than the current market price of the security or 


















          PAGE 84
          currency.  In such event the Fund would write a put option at an
          exercise price which, reduced by the premium received on the
          option, reflects the lower price it is willing to pay.  Since the
          Fund would also receive interest on debt securities or currencies
          maintained to cover the exercise price of the option, this
          technique could be used to enhance current return during periods
          of market uncertainty.  The risk in such a transaction would be
          that the market price of the underlying security or currency
          would decline below the exercise price less the premiums
          received.  Such a decline could be substantial and result in a
          significant loss to the Fund.  In addition, the Fund, because it
          does not own the specific securities or currencies which it may
          be required to purchase in exercise of the put, cannot benefit
          from appreciation, if any, with respect to such specific
          securities or currencies.  In order to comply with the
          requirements of several states, the Fund will not write a covered
          put option if, as a result, the aggregate market value of all
          portfolio securities or currencies covering put or call options
          exceeds 25% of the market value of the Fund's net assets.  Should
          these state laws change or should the Fund obtain a waiver of its
          application, the Fund reserves the right to increase this
          percentage.  In calculating the 25% limit, the Fund will offset,
          against the value of assets covering written puts and calls, the
          value of purchased puts and calls on identical securities or
          currencies with identical maturity dates.

                                Purchasing Put Options

               The Fund may purchase American or European style put
          options.  As the holder of a put option, the Fund has the right
          to sell the underlying security or currency at the exercise price
          at any time during the option period (American style) or at the
          expiration of the option (European style).  The Fund may enter
          into closing sale transactions with respect to such options,
          exercise them or permit them to expire.  The Fund may purchase
          put options for defensive purposes in order to protect against an
          anticipated decline in the value of its securities or currencies. 
          An example of such use of put options is provided below.  

             The Fund may purchase a put option on an underlying security
          or currency (a "protective put") owned by the Fund as a defensive
          technique in order to protect against an anticipated decline in
          the value of the security or currency.  Such hedge protection is
          provided only during the life of the put option when the Fund, as
          the holder of the put option, is able to sell the underlying
          security or currency at the put exercise price regardless of any
          decline in the underlying security's market price or currency's 


















          PAGE 85
          exchange value.  For example, a put option may be purchased in
          order to protect unrealized appreciation of a security or
          currency where Price-Fleming deems it desirable to continue to
          hold the security or currency because of tax considerations.  The
          premium paid for the put option and any transaction costs would
          reduce any capital gain otherwise available for distribution when
          the security or currency is eventually sold.

             The Fund may also purchase put options at a time when the Fund
          does not own the underlying security or currency.  By purchasing
          put options on a security or currency it does not own, the Fund
          seeks to benefit from a decline in the market price of the
          underlying security or currency.  If the put option is not sold
          when it has remaining value, and if the market price of the
          underlying security or currency remains equal to or greater than
          the exercise price during the life of the put option, the Fund
          will lose its entire investment in the put option.  In order for
          the purchase of a put option to be profitable, the market price
          of the underlying security or currency must decline sufficiently
          below the exercise price to cover the premium and transaction
          costs, unless the put option is sold in a closing sale
          transaction.

             To the extent required by the laws of certain states, the Fund
          may not be permitted to commit more than 5% of its assets to
          premiums when purchasing put and call options.  Should these
          state laws change or should the Fund obtain a waiver of its
          application, the Fund may commit more than 5% of its assets to
          premiums when purchasing call and put options.  The premium paid
          by the Fund when purchasing a put option will be recorded as an
          asset of the Fund.  This asset will be adjusted daily to the
          option's current market value, which will be the latest sale
          price at the time at which the net asset value per share of the
          Fund is computed (close of New York Stock Exchange), or, in the
          absence of such sale, the latest bid price.  This asset will be
          terminated upon expiration of the option, the selling (writing)
          of an identical option in a closing transaction, or the delivery
          of the underlying security or currency upon the exercise of the
          option.

                               Purchasing Call Options

               The Fund may purchase American or European style call
          options.  As the holder of a call option, the Fund has the right
          to purchase the underlying security or currency at the exercise
          price at any time during the option period (American style) or at
          the expiration of the option (European style).  The Fund may 


















          PAGE 86
          enter into closing sale transactions with respect to such
          options, exercise them or permit them to expire.  The Fund may
          purchase call options for the purpose of increasing its current
          return or avoiding tax consequences which could reduce its
          current return.  The Fund may also purchase call options in order
          to acquire the underlying securities or currencies.  Examples of
          such uses of call options are provided below.  

             Call options may be purchased by the Fund for the purpose of
          acquiring the underlying securities or currencies for its
          portfolio.  Utilized in this fashion, the purchase of call
          options enables the Fund to acquire the securities or currencies
          at the exercise price of the call option plus the premium paid. 
          At times the net cost of acquiring securities or currencies in
          this manner may be less than the cost of acquiring the securities
          or currencies directly.  This technique may also be useful to the
          Fund in purchasing a large block of securities or currencies that
          would be more difficult to acquire by direct market purchases. 
          So long as it holds such a call option rather than the underlying
          security or currency itself, the Fund is partially protected from
          any unexpected decline in the market price of the underlying
          security or currency and in such event could allow the call
          option to expire, incurring a loss only to the extent of the
          premium paid for the option.

             To the extent required by the laws of certain states, the Fund
          may not be permitted to commit more than 5% of its assets to
          premiums when purchasing call and put options.  Should these
          state laws change or should the Fund obtain a waiver of its
          application, the Fund may commit more than 5% of its assets to
          premiums when purchasing call and put options.  The Fund may also
          purchase call options on underlying securities or currencies it
          owns in order to protect unrealized gains on call options
          previously written by it.  A call option would be purchased for
          this purpose where tax considerations make it inadvisable to
          realize such gains through a closing purchase transaction.  Call
          options may also be purchased at times to avoid realizing losses.

                          Dealer (Over-the-Counter) Options

             The Fund may engage in transactions involving dealer options. 
          Certain risks are specific to dealer options.  While the Fund
          would look to a clearing corporation to exercise exchange-traded
          options, if the Fund were to purchase a dealer option, it would
          rely on the dealer from whom it purchased the option to perform
          if the option were exercised.  Failure by the dealer to do so 



















          PAGE 87
          would result in the loss of the premium paid by the Fund as well
          as loss of the expected benefit of the transaction.

             Exchange-traded options generally have a continuous liquid
          market while dealer options have none.  Consequently, the Fund
          will generally be able to realize the value of a dealer option it
          has purchased only by exercising it or reselling it to the dealer
          who issued it.  Similarly, when the Fund writes a dealer option,
          it generally will be able to close out the option prior to its
          expiration only by entering into a closing purchase transaction
          with the dealer to which the Fund originally wrote the option. 
          While the Fund will seek to enter into dealer options only with
          dealers who will agree to and which are expected to be capable of
          entering into closing transactions with the Fund, there can be no
          assurance that the Fund will be able to liquidate a dealer option
          at a favorable price at any time prior to expiration.  Until the
          Fund, as a covered dealer call option writer, is able to effect a
          closing purchase transaction, it will not be able to liquidate
          securities (or other assets) or currencies used as cover until
          the option expires or is exercised.  In the event of insolvency
          of the contra party, the Fund may be unable to liquidate a dealer
          option.  With respect to options written by the Fund, the
          inability to enter into a closing transaction may result in
          material losses to the Fund.  For example, since the Fund must
          maintain a secured position with respect to any call option on a
          security it writes, the Fund may not sell the assets which it has
          segregated to secure the position while it is obligated under the
          option.  This requirement may impair a Fund's ability to sell
          portfolio securities or currencies at a time when such sale might
          be advantageous.

             The Staff of the SEC has taken the position that purchased
          dealer options and the assets used to secure the written dealer
          options are illiquid securities.  The Fund may treat the cover
          used for written OTC options as liquid if the dealer agrees that
          the Fund may repurchase the OTC option it has written for a
          maximum price to be calculated by a predetermined formula.  In
          such cases, the OTC option would be considered illiquid only to
          the extent the maximum repurchase price under the formula exceeds
          the intrinsic value of the option.  Accordingly, the Fund will
          treat dealer options as subject to the Fund's limitation on
          unmarketable securities.  If the SEC changes its position on the
          liquidity of dealer options, the Fund will change its treatment
          of such instrument accordingly.





















          PAGE 88
                                  Futures Contracts

          Transactions in Futures

                Each Fund may enter into financial futures contracts (a
          type of potentially high risk derivative), including stock index,
          interest rate and currency futures ("futures or futures
          contracts"); however, the Funds have no current intention of
          entering into stock index futures.  The Funds, however, reserve
          the right to trade in financial futures of any kind.    

             Stock index futures contracts may be used to provide a hedge
          for a portion of the Fund's portfolio, as a cash management tool,
          or as an efficient way for Price-Fleming to implement either an
          increase or decrease in portfolio market exposure in response to
          changing market conditions.  The Fund may, purchase or sell
          futures contracts with respect to any stock index.  Nevertheless,
          to hedge the Fund's portfolio successfully, the Fund must sell
          futures contacts with respect to indices or subindices whose
          movements will have a significant correlation with movements in
          the prices of the Fund's portfolio securities.

             Interest rate or currency futures contracts may be used as a
          hedge against changes in prevailing levels of interest rates or
          currency exchange rates in order to establish more definitely the
          effective return on securities or currencies held or intended to
          be acquired by the Fund.  In this regard, the Fund could sell
          interest rate or currency futures as an offset against the effect
          of expected increases in interest rates or currency exchange
          rates and purchase such futures as an offset against the effect
          of expected declines in interest rates or currency exchange
          rates.

             The Fund will enter into futures contracts which are traded on
          national or foreign futures exchanges, and are standardized as to
          maturity date and underlying financial instrument.  Futures
          exchanges and trading in the United States are regulated under
          the Commodity Exchange Act by the CFTC.  Futures are traded in
          London at the London International Financial Futures Exchange in
          Paris at the MATIF and in Tokyo at the Tokyo Stock Exchange.  

          Although techniques other than the sale and purchase of futures
          contracts could be used for the above-referenced purposes,
          futures contracts offer an effective and relatively low cost
          means of implementing the Fund's objectives in these areas.




















          PAGE 89
          Regulatory Limitations

             The Fund will engage in futures contracts and options thereon
          only for bona fide hedging, yield enhancement, and risk
          management purposes, in each case in accordance with rules and
          regulations of the CFTC and applicable state law.

             The Fund may not purchase or sell futures contracts or related
          options if, with respect to positions which do not qualify as
          bona fide hedging under applicable CFTC rules, the sum of the
          amounts of initial margin deposits and premiums paid on those
          portions would exceed 5% of the net asset value of the Fund after
          taking into account unrealized profits and unrealized losses on
          any such contracts it has entered into; provided, however, that
          in the case of an option that is in-the-money at the time of
          purchase, the in-the-money amount may be excluded in calculating
          the 5% limitation.  For purposes of this policy options on
          futures contracts and foreign currency options traded on a
          commodities exchange will be considered "related options".  This
          policy may be modified by the Board of Directors/Trustees without
          a shareholder vote and does not limit the percentage of the
          Fund's assets at risk to 5%.

             In accordance with the rules of the State of California, the
          Fund will apply above 5% test without excluding the value of
          initial margin and premiums paid for bona fide hedging portions. 

             The Fund's use of futures contracts will not result in
          leverage.  Therefore, to the extent necessary, in instances
          involving the purchase of futures contracts or the writing of
          call or put options thereon by the Fund, an amount of cash, U.S.
          government securities or other liquid, high-grade debt
          obligations, equal to the market value of the futures contracts
          and options thereon (less any related margin deposits), will be
          identified in an account with the Fund's custodian to cover (such
          as owning an offsetting position) the position, or alternative
          cover will be employed.  Assets used as cover or held in an
          identified account cannot be sold while the position in the
          corresponding option or future is open, unless they are replaced
          with similar assets.  As a result, the commitment of a large
          portion of a Fund's assets to cover or identified accounts could
          impede portfolio management or the fund's ability to meet
          redemption requests or over current obligations.

             If the CFTC or other regulatory authorities adopt different
          (including less stringent) or additional restrictions, the Fund
          would comply with such new restrictions.


















          PAGE 90

          Trading in Futures Contracts

             A futures contract provides for the future sale by one party
          and purchase by another party of a specified amount of a specific
          financial instrument (e.g., units of a debt security) for a
          specified price, date, time and place designated at the time the
          contract is made.  Brokerage fees are incurred when a futures
          contract is bought or sold and margin deposits must be
          maintained.  Entering into a contract to buy is commonly referred
          to as buying or purchasing a contract or holding a long position. 
          Entering into a contract to sell is commonly referred to as
          selling a contract or holding a short position.

             Unlike when the Fund purchases or sells a security, no price
          would be paid or received by the Fund upon the purchase or sale
          of a futures contract.  Upon entering into a futures contract,
          and to maintain the Fund's open positions in futures contracts,
          the Fund would be required to deposit with its custodian in a
          segregated account in the name of the futures broker an amount of
          cash, U.S. government securities, suitable money market
          instruments, or liquid, high-grade debt securities, known as
          "initial margin."  The margin required for a particular futures
          contract is set by the exchange on which the contract is traded,
          and may be significantly modified from time to time by the
          exchange during the term of the contract.  Futures contracts are
          customarily purchased and sold on margins that may range upward
          from less than 5% of the value of the contract being traded.

             If the price of an open futures contract changes (by increase
          in the case of a sale or by decrease in the case of a purchase)
          so that the loss on the futures contract reaches a point at which
          the margin on deposit does not satisfy margin requirements, the
          broker will require an increase in the margin.  However, if the
          value of a position increases because of favorable price changes
          in the futures contract so that the margin deposit exceeds the
          required margin, the broker will pay the excess to the Fund.

             These subsequent payments, called "variation margin," to and
          from the futures broker, are made on a daily basis as the price
          of the underlying assets fluctuate making the long and short
          positions in the futures contract more or less valuable, a
          process known as "marking to the market."  The Fund expects to
          earn interest income on its margin deposits.  

             Although certain futures contracts, by their terms, require
          actual future delivery of and payment for the underlying 


















          PAGE 91
          instruments, in practice most futures contracts are usually
          closed out before the delivery date.  Closing out an open futures
          contract purchase or sale is effected by entering into an
          offsetting futures contract sale or purchase, respectively, for
          the same aggregate amount of the identical securities and the
          same delivery date.  If the offsetting purchase price is less
          than the original sale price, the Fund realizes a gain; if it is
          more, the Fund realizes a loss.  Conversely, if the offsetting
          sale price is more than the original purchase price, the Fund
          realizes a gain; if it is less, the Fund realizes a loss.  The
          transaction costs must also be included in these calculations. 
          There can be no assurance, however, that the Fund will be able to
          enter into an offsetting transaction with respect to a particular
          futures contract at a particular time.  If the Fund is not able
          to enter into an offsetting transaction, the Fund will continue
          to be required to maintain the margin deposits on the futures
          contract.

             As an example of an offsetting transaction in which the
          underlying instrument is not delivered, the contractual
          obligations arising from the sale of one contract of September
          Treasury Bills on an exchange may be fulfilled at any time before
          delivery of the contract is required (i.e., on a specified date
          in September, the "delivery month") by the purchase of one
          contract of September Treasury Bills on the same exchange.  In
          such instance, the difference between the price at which the
          futures contract was sold and the price paid for the offsetting
          purchase, after allowance for transaction costs, represents the
          profit or loss to the Fund.

          Special Risks of Transactions in Futures Contracts

             Volatility and Leverage.  The prices of futures contracts are
          volatile and are influenced, among other things, by actual and
          anticipated changes in the market and interest rates, which in
          turn are affected by fiscal and monetary policies and national
          and international political and economic events.

             Most United States futures exchanges limit the amount of
          fluctuation permitted in futures contract prices during a single
          trading day.  The daily limit establishes the maximum amount that
          the price of a futures contract may vary either up or down from
          the previous day's settlement price at the end of a trading
          session.  Once the daily limit has been reached in a particular
          type of futures contract, no trades may be made on that day at a
          price beyond that limit.  The daily limit governs only price
          movement during a particular trading day and therefore does not 


















          PAGE 92
          limit potential losses, because the limit may prevent the
          liquidation of unfavorable positions.  Futures contract prices
          have occasionally moved to the daily limit for several
          consecutive trading days with little or no trading, thereby
          preventing prompt liquidation of futures positions and subjecting
          some futures traders to substantial losses.

             Because of the low margin deposits required, futures trading
          involves an extremely high degree of leverage.  As a result, a
          relatively small price movement in a futures contract may result
          in immediate and substantial loss, as well as gain, to the
          investor.  For example, if at the time of purchase, 10% of the
          value of the futures contract is deposited as margin, a
          subsequent 10% decrease in the value of the futures contract
          would result in a total loss of the margin deposit, before any
          deduction for the transaction costs, if the account were then
          closed out.  A 15% decrease would result in a loss equal to 150%
          of the original margin deposit, if the contract were closed out. 
          Thus, a purchase or sale of a futures contract may result in
          losses in excess of the amount invested in the futures contract. 
          However, the Fund would presumably have sustained comparable
          losses if, instead of the futures contract, it had invested in
          the underlying financial instrument and sold it after the
          decline.  Furthermore, in the case of a futures contract
          purchase, in order to be certain that the Fund has sufficient
          assets to satisfy its obligations under a futures contract, the
          Fund earmarks to the futures contract money market instruments
          equal in value to the current value of the underlying instrument
          less the margin deposit.

             Liquidity.  The Fund may elect to close some or all of its
          futures positions at any time prior to their expiration.  The
          Fund would do so to reduce exposure represented by long futures
          positions or short futures positions.  The Fund may close its
          positions by taking opposite positions which would operate to
          terminate the Fund's position in the futures contracts.  Final
          determinations of variation margin would then be made, additional
          cash would be required to be paid by or released to the Fund, and
          the Fund would realize a loss or a gain.

             Futures contracts may be closed out only on the exchange or
          board of trade where the contracts were initially traded. 
          Although the Fund intends to purchase or sell futures contracts
          only on exchanges or boards of trade where there appears to be an
          active market, there is no assurance that a liquid market on an
          exchange or board of trade will exist for any particular contract
          at any particular time.  In such event, it might not be possible 


















          PAGE 93
          to close a futures contract, and in the event of adverse price
          movements, the Fund would continue to be required to make daily
          cash payments of variation margin.  However, in the event futures
          contracts have been used to hedge the underlying instruments, the
          Fund would continue to hold the underlying instruments subject to
          the hedge until the futures contracts could be terminated.  In
          such circumstances, an increase in the price of underlying
          instruments, if any, might partially or completely offset losses
          on the futures contract.  However, as described below, there is
          no guarantee that the price of the underlying instruments will,
          in fact, correlate with the price movements in the futures
          contract and thus provide an offset to losses on a futures
          contract.  

             Hedging Risk.  A decision of whether, when, and how to hedge
          involves skill and judgment, and even a well-conceived hedge may
          be unsuccessful to some degree because of unexpected market
          behavior, market or interest rate trends.  There are several
          risks in connection with the use by the Fund of futures contracts
          as a hedging device.  One risk arises because of the imperfect
          correlation between movements in the prices of the futures
          contracts and movements in the prices of the underlying
          instruments which are the subject of the hedge.  Price-Fleming
          will, however, attempt to reduce this risk by entering into
          futures contracts whose movements, in its judgment, will have a
          significant correlation with movements in the prices of the
          Fund's underlying instruments sought to be hedged.  

             Successful use of futures contracts by the Fund for hedging
          purposes is also subject to Price-Fleming's ability to correctly
          predict movements in the direction of the market.  It is possible
          that, when the Fund has sold futures to hedge its portfolio
          against a decline in the market, the index, indices, or
          instruments underlying futures might advance and the value of the
          underlying instruments held in the Fund's portfolio might
          decline.  If this were to occur, the Fund would lose money on the
          futures and also would experience a decline in value in its
          underlying instruments.  However, while this might occur to a
          certain degree, Price-Fleming believes that over time the value
          of the Fund's portfolio will tend to move in the same direction
          as the market indices used to hedge the portfolio.  It is also
          possible that if the Fund were to hedge against the possibility
          of a decline in the market (adversely affecting the underlying
          instruments held in its portfolio) and prices instead increased,
          the Fund would lose part or all of the benefit of increased value
          of those underlying instruments that it has hedged, because it
          would have offsetting losses in its futures positions.  In 


















          PAGE 94
          addition, in such situations, if the Fund had insufficient cash,
          it might have to sell underlying instruments to meet daily
          variation margin requirements.  Such sales of underlying
          instruments might be, but would not necessarily be, at increased
          prices (which would reflect the rising market).  The Fund might
          have to sell underlying instruments at a time when it would be
          disadvantageous to do so.  

             In addition to the possibility that there might be an
          imperfect correlation, or no correlation at all, between price
          movements in the futures contracts and the portion of the
          portfolio being hedged, the price movements of futures contracts
          might not correlate perfectly with price movements in the
          underlying instruments due to certain market distortions.  First,
          all participants in the futures market are subject to margin
          deposit and maintenance requirements.  Rather than meeting
          additional margin deposit requirements, investors might close
          futures contracts through offsetting transactions, which could
          distort the normal relationship between the underlying
          instruments and futures markets.  Second, the margin requirements
          in the futures market are less onerous than margin requirements
          in the securities markets, and as a result the futures market
          might attract more speculators than the securities markets do. 
          Increased participation by speculators in the futures market
          might also cause temporary price distortions.  Due to the
          possibility of price distortion in the futures market and also
          because of the imperfect correlation between price movements in
          the underlying instruments and movements in the prices of futures
          contracts, even a correct forecast of general market trends by
          Price-Fleming might not result in a successful hedging
          transaction over a very short time period.

          Options on Futures Contracts

             The Fund may purchase and sell options on the same types of
          futures in which it may invest.

             Options on futures are similar to options on underlying
          instruments except that options on futures give the purchaser the
          right, in return for the premium paid, to assume a position in a
          futures contract (a long position if the option is a call and a
          short position if the option is a put), rather than to purchase
          or sell the futures contract, at a specified exercise price at
          any time during the period of the option.  Upon exercise of the
          option, the delivery of the futures position by the writer of the
          option to the holder of the option will be accompanied by the
          delivery of the accumulated balance in the writer's futures 


















          PAGE 95
          margin account which represents the amount by which the market
          price of the futures contract, at exercise, exceeds (in the case
          of a call) or is less than (in the case of a put) the exercise
          price of the option on the futures contract.  Purchasers of
          options who fail to exercise their options prior to the exercise
          date suffer a loss of the premium paid.

             As an alternative to writing or purchasing call and put
          options on interest rate futures, the Fund may write or purchase
          call and put options on financial indices.  Such options would be
          used in a manner similar to the use of options on futures
          contracts.  From time to time, a single order to purchase or sell
          futures contracts (or options thereon) may be made on behalf of
          the Fund and other T. Rowe Price Funds.  Such aggregated orders
          would be allocated among the Funds and the other T. Rowe Price
          Funds in a fair and non-discriminatory manner.

          Special Risks of Transactions in Options on Futures Contracts

             The risks described under "Special Risks of Transactions on
          Futures Contracts" are substantially the same as the risks of
          using options on futures.  In addition, where the Fund seeks to
          close out an option position by writing or buying an offsetting
          option covering the same index, underlying instrument or contract
          and having the same exercise price and expiration date, its
          ability to establish and close out positions on such options will
          be subject to the maintenance of a liquid secondary market. 
          Reasons for the absence of a liquid secondary market on an
          exchange include the following: (i) there may be insufficient
          trading interest in certain options; (ii) restrictions may be
          imposed by an exchange on opening transactions or closing
          transactions or both; (iii) trading halts, suspensions or other
          restrictions may be imposed with respect to particular classes or
          series of options, or underlying instruments; (iv) unusual or
          unforeseen circumstances may interrupt normal operations on an
          exchange; (v) the facilities of an exchange or a clearing
          corporation may not at all times be adequate to handle current
          trading volume; or (vi) one or more exchanges could, for economic
          or other reasons, decide or be compelled at some future date to
          discontinue the trading of options (or a particular class or
          series of options), in which event the secondary market on that
          exchange (or in the class or series of options) would cease to
          exist, although outstanding options on the exchange that had been
          issued by a clearing corporation as a result of trades on that
          exchange would continue to be exercisable in accordance with
          their terms.  There is no assurance that higher than anticipated
          trading activity or other unforeseen events might not, at times, 


















          PAGE 96
          render certain of the facilities of any of the clearing
          corporations inadequate, and thereby result in the institution by
          an exchange of special procedures which may interfere with the
          timely execution of customers' orders.  

          Additional Futures and Options Contracts

             Although the Fund has no current intention of engaging in
          futures or options transactions other than those described above,
          it reserves the right to do so.  Such futures and options trading
          might involve risks which differ from those involved in the
          futures and options described above.

                             Foreign Futures and Options

             Participation in foreign futures and foreign options
          transactions involves the execution and clearing of trades on or
          subject to the rules of a foreign board of trade.  Neither the
          National Futures Association nor any domestic exchange regulates
          activities of any foreign boards of trade, including the
          execution, delivery and clearing of transactions, or has the
          power to compel enforcement of the rules of a foreign board of
          trade or any applicable foreign law.  This is true even if the
          exchange is formally linked to a domestic market so that a
          position taken on the market may be liquidated by a transaction
          on another market.  Moreover, such laws or regulations will vary
          depending on the foreign country in which the foreign futures or
          foreign options transaction occurs.  For these reasons, when the
          Fund trades foreign futures or foreign options contracts, it may
          not be afforded certain of the protective measures provided by
          the Commodity Exchange Act, the CFTC's regulations and the rules
          of the National Futures Association and any domestic exchange,
          including the right to use reparations proceedings before the
          Commission and arbitration proceedings provided by the National
          Futures Association or any domestic futures exchange.  In
          particular, funds received from the Fund for foreign futures or
          foreign options transactions may not be provided the same
          protections as funds received in respect of transactions on
          United States futures exchanges.  In addition, the price of any
          foreign futures or foreign options contract and, therefore, the
          potential profit and loss thereon may be affected by any variance
          in the foreign exchange rate between the time the Fund's order is
          placed and the time it is liquidated, offset or exercised.






















          PAGE 97
                            Foreign Currency Transactions

             A forward foreign currency exchange contract involves an
          obligation to purchase or sell a specific currency at a future
          date, which may be any fixed number of days from the date of the
          contract agreed upon by the parties, at a price set at the time
          of the contract.  These contracts are principally traded in the
          interbank market conducted directly between currency traders
          (usually large, commercial banks) and their customers.  A forward
          contract generally has no deposit requirement, and no commissions
          are charged at any stage for trades.  

             The Fund may enter into forward contracts for a variety of
          purposes in connection with the management of the foreign
          securities portion of its portfolio.  The Fund's use of such
          contracts would include, but not be limited to, the following:

             First, when the Fund enters into a contract for the purchase
          or sale of a security denominated in a foreign currency, it may
          desire to "lock in" the U.S. dollar price of the security.  By
          entering into a forward contract for the purchase or sale, for a
          fixed amount of dollars, of the amount of foreign currency
          involved in the underlying security transactions, the Fund will
          be able to protect itself against a possible loss resulting from
          an adverse change in the relationship between the U.S. dollar and
          the subject foreign currency during the period between the date
          the security is purchased or sold and the date on which payment
          is made or received. 

             Second, when Price-Fleming believes that one currency may
          experience a substantial movement against another currency,
          including the U.S. dollar, it may enter into a forward contract
          to sell or buy the amount of the former foreign currency,
          approximating the value of some or all of the Fund's portfolio
          securities denominated in such foreign currency.  Alternatively,
          where appropriate, the Fund may hedge all or part of its foreign
          currency exposure through the use of a basket of currencies or a
          proxy currency where such currency or currencies act as an
          effective proxy for other currencies.  In such a case, the Fund
          may enter into a forward contract where the amount of the foreign
          currency to be sold exceeds the value of the securities
          denominated in such currency.  The use of this basket hedging
          technique may be more efficient and economical than entering into
          separate forward contracts for each currency held in the Fund. 
          The precise matching of the forward contract amounts and the
          value of the securities involved will not generally be possible
          since the future value of such securities in foreign currencies 


















          PAGE 98
          will change as a consequence of market movements in the value of
          those securities between the date the forward contract is entered
          into and the date it matures.  The projection of short-term
          currency market movement is extremely difficult, and the
          successful execution of a short-term hedging strategy is highly
          uncertain.  Under normal circumstances, consideration of the
          prospect for currency parities will be incorporated into the
          longer term investment decisions made with regard to overall
          diversification strategies.  However, Price-Fleming believes that
          it is important to have the flexibility to enter into such
          forward contracts when it determines that the best interests of
          the Fund will be served.

             The Fund may enter into forward contacts for any other purpose
          consistent with the Fund's investment objective and program. 
          However, the Fund will not enter into a forward contract, or
          maintain exposure to any such contract(s), if the amount of
          foreign currency required to be delivered thereunder would exceed
          the Fund's holdings of liquid, high-grade debt securities and
          currency available for cover of the forward contract(s).  In
          determining the amount to be delivered under a contract, the Fund
          may net offsetting positions.

             At the maturity of a forward contract, the Fund may sell the
          portfolio security and make delivery of the foreign currency, or
          it may retain the security and either extend the maturity of the
          forward contract (by "rolling" that contract forward) or may
          initiate a new forward contract.

             If the Fund retains the portfolio security and engages in an
          offsetting transaction, the Fund will incur a gain or a loss (as
          described below) to the extent that there has been movement in
          forward contract prices.  If the Fund engages in an offsetting
          transaction, it may subsequently enter into a new forward
          contract to sell the foreign currency.  Should forward prices
          decline during the period between the Fund's entering into a
          forward contract for the sale of a foreign currency and the date
          it enters into an offsetting contract for the purchase of the
          foreign currency, the Fund will realize a gain to the extent the
          price of the currency it has agreed to sell exceeds the price of
          the currency it has agreed to purchase.  Should forward prices
          increase, the Fund will suffer a loss to the extent of the price 
          of the currency it has agreed to purchase exceeds the price of
          the currency it has agreed to sell.

             The Fund's dealing in forward foreign currency exchange
          contracts will generally be limited to the transactions described


















          PAGE 99
          above.  However, the Fund reserves the right to enter into
          forward foreign currency contracts for different purposes and
          under different circumstances.  Of course, the Fund is not
          required to enter into forward contracts with regard to its
          foreign currency-denominated securities and will not do so unless
          deemed appropriate by Price-Fleming.  It also should be realized
          that this method of hedging against a decline in the value of a
          currency does not eliminate fluctuations in the underlying prices
          of the securities.  It simply establishes a rate of exchange at a
          future date.  Additionally, although such contracts tend to
          minimize the risk of loss due to a decline in the value of the
          hedged currency, at the same time, they tend to limit any
          potential gain which might result from an increase in the value
          of that currency.

             Although the Fund values its assets daily in terms of U.S.
          dollars, it does not intend to convert its holdings of foreign
          currencies into U.S. dollars on a daily basis.  It will do so
          from time to time, and investors should be aware of the costs of
          currency conversion.  Although foreign exchange dealers do not
          charge a fee for conversion, they do realize a profit based on
          the difference (the "spread") between the prices at which they
          are buying and selling various currencies.  Thus, a dealer may
          offer to sell a foreign currency to the Fund at one rate, while
          offering a lesser rate of exchange should the Fund desire to
          resell that currency to the dealer.

          Federal Tax Treatment of Options, Futures Contracts and Forward
          Foreign Exchange Contracts

             The Fund may enter into certain option, futures, and forward
          foreign exchange contracts, including options and futures on
          currencies, which will be treated as Section 1256 contracts or
          straddles.

             Transactions which are considered Section 1256 contracts will
          be considered to have been closed at the end of the Fund's fiscal
          year and any gains or losses will be recognized for tax purposes
          at that time.  Such gains or losses from the normal closing or
          settlement of such transactions will be characterized as 60%
          long-term capital gain or loss and 40% short-term capital gain or
          loss regardless of the holding period of the instrument.  The
          Fund will be required to distribute net gains on such
          transactions to shareholders even though it may not have closed
          the transaction and received cash to pay such distributions.




















          PAGE 100
             Options, futures and forward foreign exchange contracts,
          including options and futures on currencies, which offset a
          foreign dollar denominated bond or currency position may be
          considered straddles for tax purposes, in which case a loss on
          any position in a straddle will be subject to deferral to the
          extent of unrealized gain in an offsetting position.  The holding
          period of the securities or currencies comprising the straddle
          will be deemed not to begin until the straddle is terminated. 
          For securities offsetting a purchased put, this adjustment of the
          holding period may increase the gain from sales of securities
          held less than three months.  The holding period of the security
          offsetting an "in-the-money qualified covered call" option on an
          equity security will not include the period of time the option is
          outstanding.

             Losses on written covered calls and purchased puts on
          securities, excluding certain "qualified covered call" options on
          equity securities, may be long-term capital loss, if the security
          covering the option was held for more than twelve months prior to
          the writing of the option.

             In order for the Fund to continue to qualify for federal
          income tax treatment as a regulated investment company, at least
          90% of its gross income for a taxable year must be derived from
          qualifying income; i.e., dividends, interest, income derived from
          loans of securities, and gains from the sale of securities or
          currencies.  Pending tax regulations could limit the extent that
          net gain realized from option, futures or foreign forward
          exchange contracts on currencies is qualifying income for
          purposes of the 90% requirement.  In addition, gains realized on
          the sale or other disposition of securities, including option,
          futures or foreign forward exchange contracts on securities or
          securities indexes and, in some cases, currencies, held for less
          than three months, must be limited to less than 30% of the Fund's
          annual gross income.  In order to avoid realizing excessive gains
          on securities or currencies held less than three months, the Fund
          may be required to defer the closing out of option, futures or
          foreign forward exchange contracts beyond the time when it would
          otherwise be advantageous to do so.  It is anticipated that
          unrealized gains on Section 1256 option, futures and foreign
          forward exchange contracts, which have been open for less than
          three months as of the end of the Fund's fiscal year and which
          are recognized for tax purposes, will not be considered gains on
          securities or currencies held less than three months for purposes
          of the 30% test.




















          PAGE 101
             Under certain circumstances, each Fund, with the exception of
          International Bond Fund, may commit a substantial portion or the
          entire value of its assets to the consummation of these
          contracts.  Price-Fleming will consider the effect a substantial
          commitment of its assets to forward contracts would have on the
          investment program of the Fund and the flexibility of the Fund to
          purchase additional securities.  In regard to International Bond
          Fund, Price-Fleming does not intend to enter into such forward
          contracts if, as a result, the Fund will have more than 50% of
          the value of its total assets committed to the consummation of
          such contracts.

               When-Issued Securities and Forward Commitment Contracts

             The Fund may purchase securities on a "when-issued" or delayed
          delivery basis ("When-Issueds") and may purchase securities on a
          forward commitment basis ("Forwards").  The Fund may invest
          without limitation in When-Issueds and Forwards.  The price of
          such securities, which may be expressed in yield terms, is fixed
          at the time the commitment to purchase is made, but delivery and
          payment take place at a later date.  Normally, the settlement
          date occurs within 90 days of the purchase for When-Issueds, but
          may be substantially longer for Forwards.  During the period
          between purchase and settlement, no payment is made by the Fund
          to the issuer and no interest accrues to the Fund.  The purchase
          of these securities will result in a loss if their value declines
          prior to the settlement date.  This could occur, for example, if
          interest rates increase prior to settlement.  The longer the
          period between purchase and settlement, the greater the risks
          are.  At the time the Fund makes the commitment to purchase these
          securities, it will record the transaction and reflect the value
          of the security in determining its net asset value.  The Fund
          will cover these securities by maintaining cash and/or liquid,
          high-grade debt securities with its custodian bank equal in value
          to commitments for them during the time between the purchase and
          the settlement.  Therefore, the longer this period, the longer
          the period during which alternative investment options are not
          available to the Fund (to the extent of the securities used for
          cover).  Such securities either will mature or, if necessary, be
          sold on or before the settlement date.

             To the extent the Fund remains fully or almost fully invested
          (in securities with a remaining maturity of more than one year)
          at the same time it purchases these securities, there will be
          greater fluctuations in the Fund's net asset value than if the
          Fund did not purchase them.



















          PAGE 102

                               INVESTMENT RESTRICTIONS

             The investment restrictions described below have been adopted
          by each Fund.  Fundamental policies of each Fund may not be
          changed without the approval of the lesser of (1) 67% of a Fund's
          shares present at a meeting of shareholders if the holders of
          more than 50% of the outstanding shares are present in person or
          by proxy or (2) more than 50% of a Fund's outstanding shares. 
          Other restrictions, in the form of operating policies, are
          subject to change by the Funds' Board of Directors without
          shareholder approval.  Any investment restriction which involves
          a maximum percentage of securities or assets shall not be
          considered to be violated unless an excess over the percentage
          occurs immediately after, and is caused by, an acquisition of
          securities or assets of, or borrowings by, the Fund.

                                 Fundamental Policies

             As a matter of fundamental policy, the Fund may not:

             (1)  Borrowing. Borrow money except that each Fund may (i)
                  borrow for non-leveraging, temporary or emergency
                  purposes and (ii) engage in reverse repurchase agreements
                  and make other investments or engage in other
                  transactions, which may involve a borrowing, in a manner
                  consistent with each Fund's investment objective and
                  program, provided that the combination of (i) and (ii)
                  shall not exceed 33 1/3% of the value of each Fund's
                  total assets (including the amount borrowed) less
                  liabilities (other than borrowings) or such other
                  percentage permitted by law.  Any borrowings which come
                  to exceed this amount will be reduced in accordance with
                  applicable law.  Each Fund may borrow from banks, other
                  Price Funds or other persons to the extent permitted by
                  applicable law. 

             (2)  Commodities.  Purchase or sell physical commodities;
                  except that it may enter into futures contracts and
                  options thereon;

             (3)  Industry Concentration (Global Government Bond and Short-
                  Term Global Income Funds).  Purchase the securities of
                  any issuer if, as a result, more than 25% of the value of
                  a Fund's total assets would be invested in the securities
                  of issuers having their principal business activities in
                  the same industry;


















          PAGE 103

                  Industry Concentration (International Bond Fund). 
                  Purchase the securities of any issuer if, as a result,
                  more than 25% of the value of a Fund's total assets would
                  be invested in the securities of issuers having their
                  principal business activities in the same industry;
                  provided, however, that the Fund will normally
                  concentrate 25% or more of its assets in securities of
                  the banking industry when the Fund's position in issues
                  maturing in one year or less equals 35% or more of the
                  Fund's total assets;

             (4)  Loans.  Make loans, although each Fund may (i) lend
                  portfolio securities and participate in an interfund
                  lending program with other Price Funds provided that no
                  such loan may be made if, as a result, the aggregate of
                  such loans would exceed 33 1/3% of the value of a Fund's
                  total assets; (ii) purchase money market securities and
                  enter into repurchase agreements; and (iii) acquire
                  publicly-distributed or privately-placed debt securities
                  and purchase debt;

             (5)  Real Estate.  Purchase or sell real estate unless
                  acquired as a result of ownership of securities or other
                  instruments (but this shall not prevent a Fund from
                  investing in securities or other instruments backed by
                  real estate or securities of companies engaged in the
                  real estate business;

             (6)  Senior Securities.  Issue senior securities except in
                  compliance with the Investment Company Act of 1940; or

             (7)  Underwriting.  Underwrite securities issued by other
                  persons, except to the extent that a Fund may be deemed
                  to be an underwriter within the meaning of the Securities
                  Act of 1933 in connection with the purchase and sale of
                  its portfolio securities in the ordinary course of
                  pursuing its investment program.

                  NOTES

                  The following notes should be read in connection with the
                  above-described fundamental policies.  The notes are not
                  fundamental policies.

                  With respect to investment restrictions (1) and (4), each
                  Fund will not borrow from or lend to any other T. Rowe 


















          PAGE 104
                  Price Fund unless each Fund applies for and receives an
                  exemptive order from the SEC or the SEC issues rules
                  permitting such transactions.  Each Fund has no current
                  intention of engaging in any such activity and there is
                  no assurance the SEC would grant any order requested by a
                  Fund or promulgate any rules allowing the transactions.

                  With respect to investment restriction (2), the Fund does
                  not consider currency contracts or hybrid investments to
                  be commodities.

                  For purposes of investment restriction (3), U.S., state
                  or local governments, or related agencies or
                  instrumentalities, are not considered an industry. 
                  Industries are determined by reference to the
                  classifications of industries set forth in the Fund's
                  semi-annual and annual reports.

                  For purposes of investment restriction (4), the Fund will
                  consider the acquisition of a debt security to include
                  the execution of a note or other evidence of an extension
                  of credit with a term of more than nine months.

                                  Operating Policies

             As a matter of operating policy, the Funds may not: 

             (1)  Borrowing.  Each Fund will not purchase additional
                  securities when money borrowed exceeds 5% of its total
                  assets.

             (2)  Control of Portfolio Companies.  Invest in companies for
                  the purpose of exercising management or control;

             (3)  Futures Contracts.  Purchase a futures contract or an
                  option thereon if, with respect to positions in futures
                  or options on futures which do not represent bona fide
                  hedging, the aggregate initial margin and premiums on
                  such positions would exceed 5% of each Fund's net asset
                  value.

             (4)  Illiquid Securities.  Purchase illiquid securities and
                  securities of unseasoned issuers if, as a result, more
                  than 15% of its net assets would be invested in such
                  securities;




















          PAGE 105
             (5)  Investment Companies.  Purchase securities of open-end or
                  closed-end investment companies except in compliance with
                  the Investment Company Act of 1940 and applicable state
                  law.  Duplicate fees may result from such purchases;

             (6)  Margin.  Purchase securities on margin, except (i) for
                  use of short-term credit necessary for clearance of
                  purchases of portfolio securities and (ii) it may make
                  margin deposits in connection with futures contracts or
                  other permissible investments; 

             (7)  Mortgaging.  Mortgage, pledge, hypothecate or, in any
                  manner, transfer any security owned by a Fund as security
                  for indebtedness except as may be necessary in connection
                  with permissible borrowings or investments and then such
                  mortgaging, pledging or hypothecating may not exceed 33
                  1/3% of a Fund's total assets at the time of borrowing or
                  investment;

             (8)  Oil and Gas Programs.  Purchase participations or other
                  direct interests or enter into leases with respect to,
                  oil, gas, or other mineral exploration or development
                  programs;

             (9)  Options, Etc.  Invest in puts, calls, straddles, spreads,
                  or any combination thereof, except to the extent
                  permitted by the prospectus and Statement of Additional
                  Information; 

             (10) Ownership of Portfolio Securities by Officers and
                  Directors.  Purchase or retain the securities of any
                  issuer if those officers and directors of a Fund, and of
                  its investment manager, who each own beneficially more
                  than .5% of the outstanding securities of such issuer,
                  together own beneficially more than 5% of such
                  securities;

             (11) Short Sales.  Effect short sales of securities;

             (12) Unseasoned Issuers.  Purchase a security (other than
                  obligations issued or guaranteed by the U.S., any state
                  or local government, or any foreign government, their
                  agencies or instrumentalities) if, as a result, more than
                  5% of the value of each Fund's total assets would be
                  invested in the securities issuers which at the time of
                  purchase had been in operation for less than three years
                  (for this purpose, the period of operation of any issuer 


















          PAGE 106
                  shall include the period of operation of any predecessor
                  or unconditional guarantor of such issuer).  This
                  restriction does not apply to securities of pooled
                  investment vehicles or mortgage or asset-backed
                  securities; or

             (13) Warrants.  Invest in warrants if, as a result thereof,
                  more than 2% of the value of the net assets of each Fund
                  would be invested in warrants which are not listed on the
                  New York Stock Exchange, the American Stock Exchange, or
                  a recognized foreign exchange, or more than 5% of the
                  value of the net assets of each Fund would be invested in
                  warrants whether or not so listed.  For purposes of these
                  percentage limitations, the warrants will be valued at
                  the lower of cost or market and warrants acquired by the
                  Funds in units or attached to securities may be deemed to
                  be without value.

             In addition to the restrictions described above, some foreign
          countries limit, or prohibit, all direct foreign investment in
          the securities of their companies.  However, the governments of
          some countries have authorized the organization of investment
          funds to permit indirect foreign investment in such securities. 
          For tax purposes these funds may be known as Passive Foreign
          Investment Companies.  Each Fund is subject to certain percentage
          limitations under the 1940 Act and certain states relating to the
          purchase of securities of investment companies, and may be
          subject to the limitation that no more than 10% of the value of
          the Fund's total assets may be invested in such securities.


                                INVESTMENT PERFORMANCE

          Total Return Performance

             Each Fund's calculation of total return performance includes
          the reinvestment of all capital gain distributions and income
          dividends for the period or periods indicated, without regard to
          tax consequences to a shareholder in each Fund.  Total return is
          calculated as the percentage change between the beginning value
          of a static account in each Fund and the ending value of that
          account measured by the then current net asset value, including
          all shares acquired through reinvestment of income and capital
          gains dividends.  The results shown are historical and should not
          be considered indicative of the future performance of each Fund. 
          Each average annual compound rate of return is derived from the
          cumulative performance of each Fund over the time period 


















          PAGE 107
          specified.  The annual compound rate of return for each Fund over
          any other period of time will vary from the average.

             International Bond Fund

                       Cumulative Performance Percentage Change
                                                                 Since
                                            1 Year    5 Years  Inception
                                             Ended     Ended   9/10/86-
                                           12/31/94+  12/31/9412/31/94++
                                           ________  _________ _________

          International Bond Fund            -1.84%     64.81% 106.94%
          T. Rowe Price International
           Stock Fund                        -0.76      41.69  121.82
          Compass Capital: International
           Fixed Income                      -3.71      --      --
          Lazard: International Fixed
           Income                             4.22      --      --
          Morgan Grenfell International
           Fixed                             --         --      --
          Scudder International Bond         -8.61      68.44   --
          Stand Ayer Wood: International
           Fixed                             -9.22      --      --
          J.P. Morgan Non-U.S. Dollar
           Gov't. Bond Index                  4.93      63.59  126.49*
          Lipper: Average of General
           World Income Funds                -6.49      43.77   90.89

          *Since 9/30/86




































          PAGE 108
                       Average Annual Compound Rates of Return

                                                                Since
                                            1 Year   5 Years  Inception
                                             Ended    Ended    9/10/86-
                                           12/31/94+ 12/31/94 12/31/94++
                                           ________ _________ _________

          International Bond Fund            -1.84%   10.33%      9.14%
          T. Rowe Price International
           Stock Fund                        -0.76     7.21      10.06
          Compass Capital: International
           Fixed Income                      -3.71    --         --
          Lazard: International Fixed
           Income                             4.22    --         --
          Morgan Grenfell International
           Fixed                             --       --         --
          Scudder International Bond         -8.61    10.98      --
          Stand Ayer Wood: International
           Fixed                             -9.22    --         --
          J.P. Morgan Non-U.S. Dollar
           Gov't. Bond Index                  4.93    10.34      10.41*
          Lipper: Average of General
           World Income Funds                -6.49     7.53       8.09

          +    If you invested $1,000 at the beginning of 1994, the total
               return on December 31, 1994 would be $981.56 ($1,000 X
               .01844).
          ++   Assumes purchase of one share of the International Bond Fund
               at the inception price of $10.00 on 9/10/86.
          *    Since 9/30/86    



































          PAGE 109
             Global Government Bond Fund

                       Cumulative Performance Percentage Change

                                                      Since
                                          1 Year    Inception
                                           Ended    12/28/90-
                                         12/31/94+ 12/31/94++
                                         _________ __________

          T. Rowe Price Global
           Government Bond Fund            -3.05%     23.84%
          T. Rowe Price International
           Bond Fund                       -1.84      43.73
          T. Rowe Price International
           Stock Fund                      -0.76      46.32
          Brinson: Global Bond             -3.49      --
          Massachusetts Financial
           World Wide Gov't. Trust "A"     -6.57      27.14
          Merrill Lynch Global Bond
           Fund "A"                        -5.29      34.36
          Paine Webber Global Income
           Fund "B"                        -4.73      20.23
          J.P. Morgan Global Gov't.
           Bond Index                       1.28      37.24
          J.P. Morgan Global Gov't.
           Bond Hedged Index               -4.05      29.81
          Lipper: Average of General
           World Income Funds              -6.49      27.25





































          PAGE 110
                       Average Annual Compound Rates of Return

                                                      Since
                                          1 Year    Inception
                                           Ended    12/28/90-
                                         12/31/94+ 12/31/94++
                                         _________ __________

          T. Rowe Price Global
           Government Bond Fund            -3.05%      5.49%
          T. Rowe Price International
           Bond Fund                       -1.84       9.49
          T. Rowe Price International
           Stock Fund                      -0.76       9.98
          Brinson: Global Bond             -3.49      --
          Massachusetts Financial
           World Wide Gov't. Trust "A"     -6.57       6.18
          Merrill Lynch Global Bond
           Fund "A"                        -5.29       7.66
          Paine Webber Global Income
           Fund "B"                        -4.73       4.71
          J.P. Morgan Global Gov't.
           Bond Index                       1.28       8.23
          J.P. Morgan Global Gov't.
           Bond Hedged Index               -4.05       6.74
          Lipper: Average of General
           World Income Funds              -6.49       6.21

          +    If you invested $1,000 at the beginning of 1994, the total
               return on December 31, 1994 would be $969.45 ($1,000 X
               .03055).
          ++   Assumes purchase of one share of the Global Government Bond
               Fund at the inception price of $10.00 on 12/28/90.    
































          PAGE 111
             Short-Term Global Income Fund

                       Cumulative Performance Percentage Change

                                                      Since
                                          1 Year    Inception
                                           Ended    06/30/92-
                                         12/31/94+ 12/31/94++
                                         _________ __________

          T. Rowe Price Short-Term
           Global Income                   -2.92%      4.49%
          Alliance Short-Term Multi-
           Market Trust "A"                -8.74      -4.22
          Blanchard Short-Term Global
           Income Fund                     -4.42       4.63
          Fidelity Investment Trust:
           Short World Income Fund         -5.90       6.49
          Scudder Short-Term Global
           Income Fund                     -1.13       6.98
          Lipper: Average of Short
           World Multi-Market Funds        -4.25       1.20

                       Average Annual Compound Rates of Return

                                                      Since
                                          1 Year    Inception
                                           Ended    06/30/92-
                                         12/31/94+ 12/31/94++
                                         _________ __________

          T. Rowe Price Short-Term
           Global Income                   -2.92%      1.77%
          Alliance Short-Term Multi-
           Market Trust "A"                -8.74      -1.71
          Blanchard Short-Term Global
           Income Fund                     -4.42       1.82
          Fidelity Investment Trust:
           Short World Income Fund         -5.90       2.54
          Scudder Short-Term Global
           Income Fund                     -1.13       2.73
          Lipper: Average of Short
           World Multi-Market Funds        -4.25       0.48

          +    If you invested $1,000 at the beginning of 1994, the total
               return on December 31, 1994 would be $970.84 ($1,000 X
               .02916).



















          PAGE 112
          ++   Assumes purchase of one share of the Short-Term Global
               Income Fund at the inception price of $10.00 on
               06/30/92.    

          Short-Term Global Income, Global Government Bond, and
          International Bond Funds

             From time to time, in reports and promotional literature, one
          or more of the T. Rowe Price funds, including these Funds, may
          compare its performance to Overnight Government Repurchase
          Agreements, Treasury bills, notes, and bonds, certificates of
          deposit, and six-month money market certificates.  Performance
          may also be compared to (1) indices of broad groups of managed
          and unmanaged securities considered to be representative of or
          similar to Fund portfolio holdings (2) other mutual funds or (3)
          other measures of performance set forth in publications such as:

              Advertising News Service, Inc., "Bank Rate Monitor+ - The
              Weekly Financial Rate Reporter" is a weekly publication which
              lists the yields on various money market instruments offered
              to the public by 100 leading banks and thrift institutions in
              the U.S., including loan rates offered by these banks.  Bank
              certificates of deposit differ from mutual funds in several
              ways: the interest rate established by the sponsoring bank is
              fixed for the term of a CD; there are penalties for early
              withdrawal from CDs; and the principal on a CD is insured.  

              Consumer Price Index - prepared monthly by the Department of
              Commerce, this index is based on the price of selected
              consumer goods and is widely accepted as an indicator of U.S.
              price levels in general.

              Donoghue Organization, Inc., "Donoghue's Money Fund Report"
              is a weekly publication which tracks net assets, yield,
              maturity and portfolio holdings on approximately 380 money
              market mutual funds offered in the U.S.  These funds are
              broken down into various categories such as U.S. Treasury,
              Domestic Prime and Euros, Domestic Prime and Euros and
              Yankees, and Aggressive.

              First Boston High Yield Index shows statistics on the
              Composite Index and analytical data on new issues in the
              marketplace and low-grade issuers.

              International Bond Fund Major Competitors - the average of
              the following mutual funds:  Massachusetts Financial Global
              Bond Fund, Merrill-Lynch Retirement Global Bond Fund, 


















          PAGE 113
              Prudential-Bache Global Yield Fund, or other similar mutual
              funds;

              Lipper Analytical Services, Inc. Average of World Income
              Funds - a widely used independent research firm which ranks
              mutual funds by overall performance, investment objectives,
              and assets.

              Lipper Analytical Services, Inc., "Lipper-Fixed Income Fund
              Performance Analysis" is a monthly publication which tracks
              net assets, total return, principal return and yield on
              approximately 950 fixed income mutual funds offered in the
              United States.

              Merrill Lynch Global Government Bond Indices - provides
              detailed compound returns for individual countries and a
              market weighted index beginning in 1986.  Returns are broken
              down into local market and currency components.

              Merrill Lynch, Pierce, Fenner & Smith, Inc., "Taxable Bond
              Indices" is a monthly publication which lists principal,
              coupon and total return on over 100 different taxable bond
              indices which Merrill Lynch tracks, together with the par
              weighted characteristics of each Index.  The index used as a
              benchmark for the High Yield Fund is the High Yield Index. 
              The two indices used as benchmarks for the Short-Term Bond
              Fund are the 91-Day Treasury Bill Index and the 1-2.99 Year
              Treasury Note Index.

              Morningstar, Inc. is a widely used independent research firm
              which rates mutual funds by overall performance, investment
              objectives, and assets.

              Reuters Reports.  Reuters is a news and information
              organization which provides statistics and analytical data on
              yields available in various countries.

              Salomon Brothers Broad Investment Grade Index - a widely used
              index composed of U.S. domestic government, corporate, and
              mortgage-backed fixed income securities.

              Salomon Brothers Inc. "Bond Market Round-up" is a weekly
              publication which tracks the yields and yield spreads on a
              large, but select, group of money market instruments, public
              corporate debt obligations, and public obligations of the
              U.S. Treasury and agencies of the U.S. Government.



















          PAGE 114
              Salomon Brothers Inc. "Market Performance" is a monthly
              publication which tracks principal return, total return and
              yield on the Salomon Brothers Broad investment - Grade Bond
              Index and the components of the Index.

              Salomon Brothers World Bond Index and related subindices -
              provides detailed compound returns for individual countries
              and a market-weighted index beginning in 1978.  Returns are
              broken down into local market and currency components.

              Salomon Brothers World Government Bond Index and related
              subindices - provides detailed compound returns for
              individual countries and a market weighted index beginning in
              1985.  Returns are broken down into local market and currency
              components.

              Shearson Lehman American Express Government/Corporate Bond
              Index - a widely used index composed of U.S. domestic
              government and corporate fixed income securities.

              Shearson Lehman Brothers, Inc. "The Bond Market Report" is a
              monthly publication which tracks principal, coupon and total
              return on the Shearson Lehman Govt./Corp. Index and Shearson
              Lehman Aggregate Bond Index, as well as all the components of
              these Indices.

              Standard & Poor's "500" Index - a widely recognized index
              composed of the capitalization-weighted average of the price
              of 500 of the largest publicly traded stocks.

              Telerate Systems, Inc., a computer system to which we
              subscribe which tracks the daily rates on money market
              instruments, public corporate debt obligations and public
              obligations of the U.S. Treasury and agencies of the U.S.
              Government.

              Wall Street Journal, a daily newspaper publication which
              lists the yields and current market values on money market
              instruments, public corporate debt obligations, public
              obligations of the U.S. Treasury and agencies of the U.S.
              Government as well as common stocks, preferred stocks,
              convertible preferred stocks, options and commodities; in
              addition to indices prepared by the research departments of
              such financial organizations as Shearson Lehman/American
              Express Inc. and Merrill Lynch, Pierce, Fenner and Smith,
              Inc., including information provided by the Federal Reserve
              Board.


















          PAGE 115

             Indices prepared by the research departments of such financial
          organizations as Salomon Brothers, Inc., Merrill Lynch, Pierce,
          Fenner & Smith, Inc., Bear Stearns & Co., Inc., and Ibbotson
          Associates will be used, as well as information provided by the
          Federal Reserve Board.

             Performance rankings and ratings reported periodically in
          national financial publications such as MONEY, FORBES, BUSINESS
          WEEK, and BARRON'S, etc. may also be used.

          Benefits of Investing in High-Quality Bond Funds

          o  Higher Income

                Bonds have generally provided a higher income than money
             market securities because yields have usually increased with
             longer maturities. For instance, the yield on the 30-year
             Treasury bond usually exceeds the yield on the 1-year Treasury
             bill or 5-year Treasury note.  However, securities with longer
             maturities fluctuate more in price than those with shorter
             maturities.  Therefore, the investor must weigh the advantages
             of higher yields against the possibility of greater
             fluctuation in the principal value of your investment.

          o  Income Compounding

                Investing in bond mutual funds allows investors to benefit
             from easy and convenient compounding, because you can
             automatically reinvest monthly dividends in additional fund
             shares.  Each month investors earn interest on a larger number
             of shares.  Also, reinvesting dividends removes the temptation
             to spend the income.  

          o  Broad Diversification

                Each share of a mutual fund represents an interest in a
             large pool of securities, so even a small investment is
             broadly diversified by maturity.  Since most bonds trade
             efficiently only in very large blocks, mutual funds provide a
             degree of diversification that may be difficult for individual
             investors to achieve on their own.

          o  Lower Portfolio Volatility

                Investing a portion of one's assets in longer term, high-
             quality bonds can help smooth out the fluctuations in your 


















          PAGE 116
             overall investment results, because bond prices do not
             necessarily move with stock prices.  Also, bonds usually have
             higher income yields than stocks, thus increasing the total
             income component of your portfolio.  This strategy should also
             add stability to overall results, as income is always a
             positive component of total return.

          o  Liquidity

                A bond fund can supplement a money market fund or bank
             account as a source of capital for unexpected contingencies. 
             T. Rowe Price fixed-income funds offer you easy access to
             money through free checkwriting and convenient redemption or
             exchange features.  Of course, the value of a bond fund's
             shares redeemed through checkwriting may be worth more or less
             than their value at the time of their original purchase.

          Suitability

                   High-quality bond funds are most suitable for the
          following objectives: obtaining a higher current income with
          minimal credit risk; compounding of income over time; or
          diversifying overall investments to reduce volatility.


                               GOVERNMENT BOND YIELDS+
                 The Fund can invest in the world's highest yielding
                      government bonds, wherever they are found.


                                       Chart 1


          Global Government Bond Fund

          +  Semiannual equivalent yields on 10-year government bonds,
             1984 through 1994.

             Source: Datastream

          IRAs

             An IRA is a long-term investment whose objective is to
          accumulate personal savings for retirement.  Due to the long-term
          nature of the investment, even slight differences in performance
          will result in significantly different assets at retirement. 
          Mutual funds, with their diversity of choice, can be used for IRA


















          PAGE 117
          investments.  Generally, individuals may need to adjust their
          underlying IRA investments as their time to retirement and
          tolerance for risk changes.

          Other Features and Benefits

             Each Fund is a member of the T. Rowe Price Family of Funds and
          may help investors achieve various long-term investment goals,
          such as investing money for retirement, saving for a down payment
          on a home, or paying college costs.  To explain how the Fund
          could be used to assist investors in planning for these goals and
          to illustrate basic principles of investing, various worksheets
          and guides prepared by T. Rowe Price Associates, Inc. and/or T.
          Rowe Price Investment Services, Inc. may be made available. 
          These currently include: the Asset Mix Worksheet which is
          designed to show shareholders how to reduce their investment risk
          by developing a diversified investment plan: the College Planning
          Guide which discusses various aspects of financial planning to
          meet college expenses and assists parents in projecting the costs
          of a college education for their children; the Retirement
          Planning Kit (also available in a PC version) which includes a
          detailed workbook to determine how much money you may need for
          retirement and suggests how you might invest to reach your goal;
          and the Retirees Financial Guide which includes a detailed
          workbook to determine how much money you can afford to spend and
          still preserve your purchasing power and suggest how you might
          invest to reach your goal.  From time to time, other worksheets
          and guides may be made available as well.  Of course, an
          investment in the Fund cannot guarantee that such goals will be
          met. 

             To assist investors in understanding the different returns and
          risk characteristics of various investments, the aforementioned
          guides will include presentation of historical returns of various
          investments using published indices.  An example of this is shown
          on the next page.





























          PAGE 118
                     Historical Returns for Different Investments

          Annualized returns for periods ended 12/31/94

                                    50 years   20 years  10 years 5 years

          Small-Company Stocks        14.4%      20.3%     11.1%    11.8%

          Large-Company Stocks        11.9       14.6      14.4      8.7

          Foreign Stocks               N/A       16.3      17.9      1.8

          Long-Term Corporate Bonds    5.3       10.0      11.6      8.4

          Intermediate-Term U.S. 
            Gov't. Bonds               5.6        9.3       9.4      7.5

          Treasury Bills               4.7        7.3       5.8      4.7

          U.S. Inflation               4.5        5.5       3.6      3.5

          Sources:  Ibbotson Associates, Morgan Stanley.  Foreign stocks
          reflect performance of The Morgan Stanley Capital International
          EAFE Index, which includes some 1,000 companies representing the
          stock markets of Europe, Australia, New Zealand, and the Far
          East.  This chart is for illustrative purposes only and should
          not be considered as performance for, or the annualized return
          of, any T. Rowe Price Fund.  Past performance does not guarantee
          future results.    

             Also included will be various portfolios demonstrating how
          these historical indices would have performed in various
          combinations over a specified time period in terms of return.  An
          example of this is shown on the next page.































          PAGE 119
                        Performance of Retirement Portfolios*


                      Asset Mix      Average Annualized         Value
                                      Returns 20 Years            of
                                       Ended 12/31/94          $10,000
                                                              Investment
                                                             After Period
                   ________________  __________________      ____________

                                     Nominal  Real Best  Worst
          Portfolio GrowthIncomeSafety ReturnReturn**Year  Year

          I.   Low
               Risk  40%   40%   20%  12.4%   6.9% 24.9% 0.1%  $ 92,515

          II.  Moderate
               Risk  60%   30%   10%  13.5%   8.1% 29.1% -1.8% $118,217

          III. High
               Risk  80%   20%    0%  14.5%   9.1% 33.4% -5.2% $149,200

          Source: T. Rowe Price Associates; data supplied by Lehman
          Brothers, Wilshire Associates, and Ibbotson Associates.

          *  Based on actual performance for the 20 years ended 1993 of
             stocks (85% Wilshire 5000 and 15% Europe, Australia, Far East
             [EAFE] Index), bonds (Lehman Brothers Aggregate Bond Index
             from 1976-94 and Lehman Brothers Government/Corporate Bond
             Index from 1975), and 30-day Treasury bills from January 1975
             through December 1994.  Past performance does not guarantee
             future results.  Figures include changes in principal value
             and reinvested dividends and assume the same asset mix is
             maintained each year.  This exhibit is for illustrative
             purposes only and is not representative of the performance of
             any T. Rowe Price fund.
          **  Based on inflation rate of 5.5% for the 20-year period ended
              12/31/94.

          Insights    

             From time to time, Insights, a T. Rowe Price publication of
          reports on specific investment topics and strategies, may be
          included in the Fund's fulfillment kit.  Such reports may include
          information concerning:  calculating taxable gains and losses on
          mutual fund transactions, coping with stock market volatility,
          benefiting from dollar cost averaging, understanding 


















          PAGE 120
          international markets, investing in high-yield "junk" bonds,
          growth stock investing, conservative stock investing, value
          investing, investing in small companies, tax-free investing,
          fixed income investing, investing in mortgage-backed securities,
          as well as other topics and strategies. 


                                  YIELD INFORMATION

             From time to time, the Funds may advertise a yield figure
          calculated in the following manner:

             In conformity with regulations of the Securities and Exchange
          Commission, an income factor is calculated for each security in
          the portfolio, based upon the security's market value at the
          beginning of the period and expected yield-to-maturity.  The
          income factors are then totalled for all securities in the
          portfolio.  Next, expenses of the Fund for the period, net of
          expected reimbursements, are deducted from the income to arrive
          at net income, which is then converted to a per-share amount by
          dividing net income by the average number of shares outstanding
          during the period.  The net income per share is divided by the
          net asset value on the last day of the period to produce a
          monthly yield which is then annualized.  Quoted yield factors are
          for comparison purposes only, and are not intended to indicate
          future performance or forecast the dividend per share of the
          Fund.

          Global Government Bond Fund

             The Fund's yield calculated as set forth above for the month
          ended December 31, 1994 was 6.66%.

          Short-Term Global Income Fund

             The Fund's yield calculated as set forth above for the month
          ended December 31, 1994 was 6.99%.

          International Bond Fund

             The Fund's yield calculated as set forth above for the month
          ended December 31, 1994 was 5.95%.    

          Redemptions in Kind

             In the unlikely event a shareholder in any of the
          International Funds were to receive an in kind redemption of 


















          PAGE 121
          portfolio securities of a Fund, brokerage fees could be incurred
          by the shareholder in subsequent sale of such securities.

          Issuance of Fund Shares for Securities

             Transactions involving issuance of a fund's shares for
          securities or assets other than cash will be limited to (1) bona
          fide reorganizations; (2) statutory mergers; or (3) other
          acquisitions of portfolio securities that: (a) meet the
          investment objectives and policies of the Funds; (b) are acquired
          for investment and not for resale except in accordance with
          applicable law; (c) have a value that is readily ascertainable
          via listing on or trading in a recognized United States or
          international exchange or market; and (d) are not illiquid.


                                 MANAGEMENT OF FUNDS

             The officers and directors of the Funds are listed below. 
          Unless otherwise noted, the address of each is 100 East Pratt
          Street, Baltimore, Maryland 21202.  Except as indicated, each has
          been an employee of T. Rowe Price for more than five years.  In
          the list below, the Funds' directors who are considered
          "interested persons" of T. Rowe Price or the Fund as defined
          under Section 2(a)(19) of the Investment Company Act of 1940 are
          noted with an asterisk (*).  These directors are referred to as
          inside directors by virtue of their officership, directorship,
          and/or employment with T. Rowe Price.

             LEO C. BAILEY, Director--Retired; Address: 3396 South Placita
          Fabula, Green Valley, Arizona 85614
          ANTHONY W. DEERING, Director--Director, President and Chief
          Executive Officer, The Rouse Company, real estate developers,
          Columbia, Maryland; Advisory Director, Kleinwort, Benson (North
          America) Corporation, a registered broker-dealer; Address: 10275
          Little Patuxent Parkway, Columbia, Maryland 21044
          DONALD W. DICK, JR., Director--Principal, Overseas Partners,
          Inc., a financial investment firm; formerly (6/65-3/89) Director
          and Vice President-Consumer Products Division, McCormick &
          Company, Inc., international food processors; Director, Waverly,
          Inc., Baltimore, Maryland; Address: 111 Pavonia Avenue, Suite
          334, Jersey City, New Jersey 07310
          ADDISON LANIER, Director--Financial management; President and
          Director, Thomas Emery's Sons, Inc., and Emery Group, Inc.;
          Director, Scinet Development and Holdings, Inc.; Address: 441
          Vine Street, #2310, Cincinnati, Ohio 45202-2913



















          PAGE 122
          *M. DAVID TESTA, Chairman of the Board--Chairman of the Board, 
          Price-Fleming; Managing Director, T. Rowe Price; Vice President
          and Director, T. Rowe Price Trust Company; Chartered Financial
          Analyst; Chartered Investment Counselor
          *MARTIN G. WADE, President and Director--President, Price-
          Fleming; Director, Robert Fleming Holdings Limited; Address: 25
          Copthall Avenue, London, EC2R 7DR, England
          CHRISTOPHER D. ALDERSON, Vice President--Vice President, Price-
          Fleming
          PETER B. ASKEW, Vice President--Executive Vice President, Price-
          Fleming
          RICHARD J. BRUCE, Vice President--Vice President of Price-
          Fleming; formerly (1985-1990) Investment Manager, Jardine Fleming
          Investment Advisers, Tokyo
          ROBERT P. CAMPBELL, Vice President--Vice President, T. Rowe Price
          and Rowe Price-Fleming International Inc.; formerly (4/80-5/90)
          Vice President and Director, Private Finance, New York Life
          Insurance Company, New York, New York
          MARK J. T. EDWARDS, Vice President--Vice President, Price-Fleming
          JOHN R. FORD, Vice President--Executive Vice President, Price-
          Fleming 
          HENRY H. HOPKINS, Vice President--Vice President, Price-Fleming
          and T. Rowe Price Retirement Plan Services, Inc.; Managing
          Director, T. Rowe Price; Vice President and Director, T. Rowe
          Price Investment Services, Inc., T. Rowe Price Services, Inc. and
          T. Rowe Price Trust Company
          ROBERT C. HOWE, Vice President--Vice President, Price-Fleming and
          T. Rowe Price
          STEPHEN ILOTT, Vice President--Employee, Price-Fleming; formerly
          (1988-1991) portfolio management, Fixed Income Portfolios Group,
          Robert Fleming Holdings Limited, London
          GEORGE A. MURNAGHAN, Vice President--Vice President, Price-
          Fleming, T. Rowe Price, T. Rowe Price Trust Company, and T. Rowe
          Price Investment Services, Inc.
          JAMES S. RIEPE, Vice President--Managing Director, T. Rowe Price;
          Chairman of the Board, T. Rowe Price Services, Inc., T. Rowe
          Price Retirement Plan Services, Inc. and T. Rowe Price Trust
          Company; President and Director, T. Rowe Price Investment
          Services, Inc.; Director, Rhone-Poulenc Rorer, Inc.
          CHRISTOPHER ROTHERY, Vice President--Vice President,
          Price-Fleming; formerly (1987-1989) employee of Robert Fleming
          Holdings Limited, London
          JAMES B. M. SEDDON, Vice President--Vice President, Price-Fleming
          CHARLES P. SMITH, Vice President--Managing Director, T. Rowe
          Price; Vice President, Rowe Price-Fleming International, Inc.
          BENEDICT R. F. THOMAS, Vice President--Vice President, Price-
          Fleming


















          PAGE 123
          PETER VAN DYKE, Vice President--Managing Director, T. Rowe Price;
          Vice President, Rowe Price-Fleming International, Inc.
          DAVID J. L. WARREN, Vice President--Executive Vice President,
          Price-Fleming
          WILLIAM F. WENDLER, II, Vice President--Vice President, Price-
          Fleming, T. Rowe Price and T. Rowe Price Investment Services,
          Inc.
          EDWARD A. WIESE, Vice President--Vice President, T. Rowe Price,
          Rowe Price-Fleming International, Inc. and T. Rowe Price Trust
          Company
          LENORA V. HORNUNG, Secretary--Vice President, T. Rowe Price
          PATRICIA S. BUTCHER, Assistant Secretary--Assistant Vice
          President, T. Rowe Price; Assistant Vice President, T. Rowe Price
          Investment Services, Inc.
          CARMEN F. DEYESU, Treasurer--Vice President, T. Rowe Price, T.
          Rowe Price Services, Inc., and T. Rowe Price Trust Company
          DAVID S. MIDDLETON, Controller--Vice President, T. Rowe Price, T.
          Rowe Price Services, Inc., and T. Rowe Price Trust Company
          ANN B. CRANMER, Assistant Vice President--Vice President, Price-
          Fleming
          ROGER L. FIERY, III, Assistant Vice President--Vice President,
          Price-Fleming and Vice President, T. Rowe Price
          LEAH P. HOLMES, Assistant Vice President--Vice President, Price-
          Fleming and Assistant Vice President, T. Rowe Price
          EDWARD T. SCHNEIDER, Assistant Vice President--Assistant Vice
          President, T. Rowe Price and Vice President, T. Rowe Price
          Services, Inc.
          INGRID I. VORDEMBERGE, Assistant Vice President--Employee, T.
          Rowe Price    

                                  COMPENSATION TABLE

          _________________________________________________________________
                                           Pension or   Total Compensation
                               Aggregate   Retirement      from Fund and
           Name of           Compensation   Benefits        Fund Group
           Person,             from Fund   Accrued as         Paid to
          Position             Expensesa  Part of Fundb     Directorsc
          _________________________________________________________________
          International Bond

          Leo C. Bailey,         $4,794        N/A            $64,583
          Director

          Anthony W. Deering,     4,794        N/A             66,333
          Director



















          PAGE 124
          Donald W. Dick,         4,794        N/A             64,833
          Director

          Addison Lanier,         4,794        N/A             64,583
          Director

          M. David Testa,            --        N/A                 --
          Chairman of the Boardd

          Martin G. Wade,            --        N/A                 --
          Directord

          Global Government Bond Fund

          Leo C. Bailey,         $1,503        N/A            $64,583
          Director

          Anthony W. Deering,     1,503        N/A             66,333
          Director

          Donald W. Dick,         1,503        N/A             64,833
          Director

          Addison Lanier,         1,503        N/A             64,583
          Director

          M. David Testa,            --        N/A                 --
          Chairman of the Boardd

          Martin G. Wade,            --        N/A                 --
          Directord

          Short-Term Global Income Fund

          Leo C. Bailey,         $1,700        N/A            $64,583
          Director

          Anthony W. Deering,     1,700        N/A             66,333
          Director

          Donald W. Dick,         1,700        N/A             64,833
          Director

          Addison Lanier,         1,700        N/A             64,583
          Director




















          PAGE 125
          M. David Testa,            --        N/A                 --
          Chairman of the Boardd

          Martin G. Wade,            --        N/A                 --
          Directord

          Emerging Markets Bond Fund

          Leo C. Bailey,         $1,248        N/A            $64,583
          Director

          Anthony W. Deering,     1,248        N/A             66,333
          Director

          Donald W. Dick,         1,248        N/A             64,833
          Director

          Addison Lanier,         1,248        N/A             64,583
          Director

          M. David Testa,            --        N/A                 --
          Chairman of the Boardd

          Martin G. Wade,            --        N/A                 --
          Directord

          a   Amounts in this Column are for the period June 1, 1993
              through May 31, 1994.
          b   Not applicable.  The Fund does not pay pension or retirement
              benefits to officers or directors/trustees of the Fund.
          c   Amounts in this column are for calendar year 1994, included
              64 funds at December 31, 1994.
          d   Any director/trustee of the Fund who is an officer or
              employee of T. Rowe Price receives no renumeration from the
              Fund.    

             The Funds' Executive Committee, comprised of Messrs. Testa and
          Wade, has been authorized by the Board of Directors to exercise
          all of the powers of the Board to manage the Funds in the
          intervals between meetings of the Board, except the powers
          prohibited by statute from being delegated.
























          PAGE 126
                           PRINCIPAL HOLDERS OF SECURITIES

             As of the date of the prospectus, the officers and directors
          of the Funds, as a group, owned less than 1% of the outstanding
          shares of each Fund.

             As of January 31, 1995, the following shareholders
          beneficially owned more than 5% of the outstanding shares of the
          Short-Term Global Income Fund: Warren Securities Corporation, 10
          Main Street, P.O. Box 6159, Peabody, Massachusetts 01961-6159;
          the Global Government Bond Fund: Edrayco, P.O. Drawer 937,
          Gainesville, Georgia 30503-0937; and the International Bond Fund:
          Charles Scwab & Co. Inc., Reinvest Account, Attn.: Mutual Fund
          Dept., 101 West Montgomery Street, San Francisco, California
          94104-4122; and Yachtcrew & Co., FDO Spectrum Income Fund
          Account, Attn.: Mark White, State Street Bank and Trust Co., 1776
          Heritage Drive - 4W, North Quincy, Massachusetts 02171-2101;
          Northern Trust Co., FBO Teacher Retirement System of Texas Trust
          DTD 10/1/93, P.O. Box 92956, Chicago, Illinois 60690.    


                            INVESTMENT MANAGEMENT SERVICES

          Services

             Under the Management Agreement, Price-Fleming provides each
          Fund with discretionary investment services.  Specifically,
          Price-Fleming is responsible for supervising and directing the
          investments of each Fund in accordance with the Fund's investment
          objective, program, and restrictions as provided in its
          prospectus and this Statement of Additional Information.  Price-
          Fleming is also responsible for effecting all security
          transactions on behalf of each Fund, including the negotiation of
          commissions and the allocation of principal business and
          portfolio brokerage.  In addition to these services, Price-
          Fleming provides the Funds with certain corporate administrative
          services, including: maintaining the Funds' corporate existence,
          corporate records, and registering and qualifying Fund shares
          under federal and state laws; monitoring the financial,
          accounting, and administrative functions of each Fund;
          maintaining liaison with the agents employed by each Fund such as
          the Fund's custodian and transfer agent; assisting each Fund in
          the coordination of such agents' activities; and permitting
          Price-Fleming's employees to serve as officers, directors, and
          committee members of each Fund without cost to the Fund.  




















          PAGE 127
             The Management Agreement also provides that Price-Fleming, its
          directors, officers, employees, and certain other persons
          performing specific functions for each Fund will only be liable
          to the Fund for losses resulting from willful misfeasance, bad
          faith, gross negligence, or reckless disregard of duty.

             Under the Management Agreement, Price-Fleming is permitted to
          utilize the services or facilities of others to provide it or the
          Funds with statistical and other factual information, advice
          regarding economic factors and trends, advice as to occasional
          transactions in specific securities, and such other information,
          advice or assistance as Price-Fleming may deem necessary,
          appropriate, or convenient for the discharge of its obligations
          under the Management Agreement or otherwise helpful to the Funds.

             Certain administrative support is provided by T. Rowe Price
          which receives from Price-Fleming a fee of .15% of the market
          value of all assets in equity accounts, .15% of the market value
          of all assets in active fixed income accounts and .035% of the
          market value of all assets in passive fixed income accounts under
          Price-Fleming's management.

             Price-Fleming has entered into separate letters of agreement
          with Fleming Investment Management Limited ("FIM") and Jardine
          Fleming Investment Holdings Limited ("JFIH"), wherein FIM and
          JFIH have agreed to render investment research and administrative
          support to Price-Fleming.  FIM is a wholly-owned subsidiary of
          Robert Fleming Asset Management Limited which is a wholly-owned
          subsidiary of Robert Fleming Holdings Limited ("Robert Fleming
          Holdings").  JFIH is an indirect wholly-owned subsidiary of
          Jardine Fleming Group Limited.  Under the letters of agreement,
          these companies will provide Price-Fleming with research material
          containing statistical and other factual information, advice
          regarding economic factors and trends, advice on the allocation
          of investments among countries and as between debt and equity
          classes of securities, and research and occasional advice with
          respect to specific companies.  For these services, FIM and JFIH
          each receives a fee of .075% of the market value of all assets in
          equity accounts under Price-Fleming's management.  JFIH receives
          a fee of .075% of the market value of all assets in active fixed
          income accounts and .0175% of such market value in passive fixed
          income accounts under Price-Fleming's management.

             Robert Fleming personnel have extensive research resources
          throughout the world.  A strong emphasis is placed on direct
          contact with companies in the research universe.  Robert Fleming
          personnel, who frequently speak the local language, have access 


















          PAGE 128
          to the full range of research products available in the market
          place and are encouraged to produce independent work dedicated
          solely to portfolio investment management, which adds value to
          that generally available.

          Management Fee

             Each Fund pays Price-Fleming a fee ("Fee") which consists of
          two components:  a Group Management Fee ("Group Fee") and an
          Individual Fund Fee ("Fund Fee").  The Fee is paid monthly to
          Price-Fleming on the first business day of the next succeeding
          calendar month and is calculated as described below.

             The monthly Group Fee ("Monthly Group Fee") is the sum of the
          daily Group Fee accruals ("Daily Group Fee Accruals") for each
          month.  The Daily Group Fee Accrual for any particular day is
          computed by multiplying the Price Funds' group fee accrual as
          determined below ("Daily Price Funds' Group Fee Accrual") by the
          ratio of each Fund's net assets for that day to the sum of the
          aggregate net assets of the Price Funds for that day.  The Daily
          Price Funds' Group Fee Accrual for any particular day is
          calculated by multiplying the fraction of one (1) over the number
          of calendar days in the year by the annualized Daily Price Funds'
          Group Fee Accrual for that day as determined in accordance with
          the following schedule:

                                     Price Funds'
                                Annual Group Base Fee
                            Rate for Each Level of Assets
                          _________________________________

                                 0.480%   First $1 billion
                                 0.450%   Next $1 billion
                                 0.420%   Next $1 billion
                                 0.390%   Next $1 billion
                                 0.370%   Next $1 billion
                                 0.360%   Next $2 billion
                                 0.350%   Next $2 billion
                                 0.340%   Next $5 billion
                                 0.330%   Next $10 billion
                                 0.320%   Next $10 billion
                                 0.310%   Thereafter

             For the purpose of calculating the Group Fee, the Price Funds
          include all the mutual funds distributed by T. Rowe Price
          Investment Services, Inc. (excluding T. Rowe Price Spectrum Fund,
          Inc. and any institutional or private label mutual funds).  For 



















          PAGE 129
          the purpose of calculating the Daily Price Funds' Group Fee
          Accrual for any particular day, the net assets of each Price Fund
          are determined in accordance with the Funds' prospectus as of the
          close of business on the previous business day on which the Fund
          was open for business.

                The monthly Fund Fee ("Monthly Fund Fee") is the sum of the
          daily Fund Fee accruals ("Daily Fund Fee Accruals") for each
          month.  The Daily Fund Fee Accrual for any particular day is
          computed by multiplying the fraction of one (1) over the number
          of calendar days in the year by the Fund Fee Rate of 0.25% for
          the Short-Term Global Income Fund; 0.35% each for the Global
          Government Bond and International Bond Funds; and 0.45% for the
          Emerging Markets Bond Fund, and multiplying this product by the
          net assets of the Fund for that day, as determined in accordance
          with the Funds' prospectus as of the close of business on the
          previous business day on which the Fund was open for business.

             The Short-Term Global Income Fund paid management fees for the
          years 1994 and 1993, were $358,986 and $341,000, and did not pay
          any management fees to Price-Fleming for the fiscal year ended
          1992, Global Government Bond Fund paid management fees for the
          years 1994, 1993, and 1992, in the amounts of $159,467, $269,000,
          and $253,000.  The management fees paid by the International Bond
          Fund for the years 1994, 1993, and 1992, were $5,206,000,
          $4,363,000, and $3,567,000, respectively.  The Emerging Markets
          Bond Fund did not pay any management fees to Price-Fleming for
          the fiscal year ended 1994.    

          Limitation on Fund Expenses

             The Management Agreement between each Fund and Price-Fleming
          provides that each Fund will bear all expenses of its operations
          not specifically assumed by Price-Fleming.  However, in
          compliance with certain state regulations, Price-Fleming will
          reimburse each Fund for certain expenses which in any year exceed
          the limits prescribed by any state in which the Fund's shares are
          qualified for sale.  Presently, the most restrictive expense
          ratio limitation imposed by any state is 2.5% of the first $30
          million of a Fund's average daily net assets, 2% of the next $70
          million of the average daily net assets, and 1.5% of net assets
          in excess of $100 million.  For the purpose of determining
          whether a Fund is entitled to reimbursement, the expenses of each
          Fund are calculated on a monthly basis.  If the Fund is entitled
          to reimbursement, that month's management fee will be reduced or
          postponed, with any adjustment made after the end of the year.



















          PAGE 130
          Emerging Markets Bond Fund

                In the interest of limiting the expenses of the Fund during
          its initial period of operations, Price-Fleming agreed to waive
          fees and bear any expenses through December 31, 1996, which would
          cause the Fund's ratio of expenses to average net assets to
          exceed 1.25%.  Fees waived or expenses paid or assumed under this
          agreement are subject to reimbursement to Price-Fleming by the
          Fund whenever the Fund's expense ratio is below 1.25%; however no
          reimbursement will be made to Price-Fleming after December 31,
          1998, or if it would result in the expense ratio exceeding 1.25%. 
          The Management Agreement also provides that one or more
          additional expense limitation periods (of the same or different
          levels and time periods) may be implemented after the expiration
          of the current one on December 31, 1996, and that with respect to
          any such additional limitation period, the Fund may reimburse
          Price-Fleming, provided the reimbursement does not result in the
          Fund's aggregate expenses exceeding the additional expense
          limitation.    

          Short-Term Global Income Fund

                In the interest of limiting the expenses of the Fund during
          its initial period of operations, Price-Fleming agreed to waive
          fees and bear any expenses through December 31, 1993, which would
          cause the Fund's ratio of expenses to average net assets to
          exceed 1.00%.  Fees waived or expenses paid or assumed under this
          agreement are subject to reimbursement to Price-Fleming by the
          Fund whenever the Fund's expense ratio is below 1.00%; however no
          reimbursement will be made to Price-Fleming after December 31,
          1995, or if it would result in the expense ratio exceeding 1.00%. 
          The Management Agreement also provides that one or more
          additional expense limitation periods (of the same or different
          levels and time periods) may be implemented after the expiration
          of the current one on December 31, 1993, and that with respect to
          any such additional limitation period, the Fund may reimburse
          Price-Fleming, provided the reimbursement does not result in the
          Fund's aggregate expenses exceeding the additional expense
          limitation.  Pursuant to this agreement, $125,000 of management
          fees were not accrued by the Fund for the year ended December 31,
          1994.  Pursuant to a previous agreement, $295,000 of unaccrued
          fees and other expenses borne by Price-Fleming remain subject to
          reimbursement through December 31, 1995.    






















          PAGE 131
                 
          Global Government Bond Fund

                In the interest of limiting the expenses of the Fund during
          its initial period of operations, Price-Fleming agreed to waive
          fees and bear any expenses through December 31, 1992, which would
          cause the Fund's ratio of expenses to average net assets to
          exceed 1.20%.  Effective January 1, 1993 Price-Fleming agreed to
          extend the Fund's existing expense limitation of 1.20% for a
          period of two years through December 31, 1994.  Effective January
          1, 1995, Price-Fleming agreed to extend the fund's 1.20% expense
          limitation for a period of two years through December 31, 1996. 
          The Management Agreement also provides that one or more
          additional expense limitation periods (of the same or different
          time periods) may be implemented after the expiration of the
          current one on December 31, 1992, and that with respect to any
          such additional limitation period, the Fund may reimburse Price-
          Fleming, provided the reimbursement does not result in the Fund's
          aggregate expenses exceeding the additional expense limitation or
          any applicable state expense limitation.  Fees waived or expenses
          paid or assumed under each agreement are subject to reimbursement
          to Price-Fleming by the Fund whenever the Fund's expense ratio is
          below 1.20%; however, no reimbursement will be made after
          December 31, 1994 (for the initial agreement), December 31, 1996
          (for the second agreement), or December 31, 1998 (for the third
          agreement), or if it would result in the expense ratio exceeding
          1.50%.    

                Pursuant to the Fund's expense limitations, management fees
          aggregating $144,000, were not accrued for the year ended
          December 31, 1994.  In addition, pursuant to past expense
          limitations, $388,000 of unaccrued fees and other expenses borne
          by Price-Fleming were permanently waived at December 31, 1994,
          and an additional $98,00 of unaccrued fees from 1993 remain
          subject to reimbursement through December 31, 1996.    

          International Bond Fund

             The Fund is a party to a Special Servicing Agreement
          ("Agreement") between and among T. Rowe Price Spectrum Fund, Inc.
          ("Spectrum Fund"), T. Rowe Price, T. Rowe Price Services, Inc.
          and various other T. Rowe Price funds which, along with the
          Funds, are funds in which Spectrum Fund invests (collectively all
          such funds "Underlying Price Funds").

             The Agreement provides that, if the Board of
          Directors/Trustees of any Underlying Price Fund determines that 


















          PAGE 132
          such Underlying Fund's share of the aggregate expenses of
          Spectrum Fund is less than the estimated savings to the
          Underlying Price Fund from the operation of Spectrum Fund, the
          Underlying Price Fund will bear those expenses in proportion to
          the average daily value of its shares owned by Spectrum Fund,
          provided further that no Underlying Price Fund will bear such
          expenses in excess of the estimated savings to it.  Such savings
          are expected to result primarily from the elimination of numerous
          separate shareholder accounts which are or would have been
          invested directly in the Underlying Price Funds and the resulting
          reduction in shareholder servicing costs.  Although such cost
          savings are not certain, the estimated savings to the Underlying
          Price Funds generated by the operation of Spectrum Fund are
          expected to be sufficient to offset most, if not all, of the
          expenses incurred by Spectrum Fund.


                                DISTRIBUTOR FOR FUNDS

             T. Rowe Price Investment Services, Inc. ("Investment
          Services"), a Maryland corporation formed in 1980 as a wholly-
          owned subsidiary of T. Rowe Price, serves as the Funds'
          distributor.  Investment Services is registered as a broker-
          dealer under the Securities Exchange Act of 1934 and is a member
          of the National Association of Securities Dealers, Inc.  The
          offering of each Fund's shares is continuous.

             Investment Services is located at the same address as the
          Funds and T. Rowe Price -- 100 East Pratt Street, Baltimore,
          Maryland 21202.

             Investment Services serves as distributor to the Funds
          pursuant to an Underwriting Agreement ("Underwriting Agreement"),
          which provides that each Fund will pay all fees and expenses in
          connection with: registering and qualifying its shares under the
          various state "blue sky" laws; preparing, setting in type,
          printing, and mailing its prospectuses and reports to
          shareholders; and issuing its shares, including expenses of
          confirming purchase orders.

             The Underwriting Agreement provides that Investment Services
          will pay all fees and expenses in connection with: printing and
          distributing prospectuses and reports for use in offering and
          selling Fund shares; preparing, setting in type, printing, and
          mailing all sales literature and advertising; Investment
          Services' federal and state registrations as a broker-dealer; and
          offering and selling Fund shares, except for those fees and 


















          PAGE 133
          expenses specifically assumed by each Fund.  Investment Services'
          expenses are paid by T. Rowe Price.

             Investment Services acts as the agent of each Fund in
          connection with the sale of its shares in all states in which the
          shares are qualified and in which Investment Services is
          qualified as a broker-dealer.  Under the Underwriting Agreement,
          Investment Services accepts orders for Fund shares at net asset
          value.  No sales charges are paid by investors or the Funds.


                                      CUSTODIAN

             State Street Bank and Trust Company (the "Bank") is the
          custodian for the Funds' U.S. securities and cash, but it does
          not participate in the Funds' investment decisions.  Portfolio
          securities purchased in the U.S. are maintained in the custody of
          the Bank and may be entered into the Federal Reserve Book Entry
          System, or the security depository system of the Depository Trust
          Corporation.  The Funds have entered into a Custodian Agreement
          with The Chase Manhattan Bank, N.A., London, pursuant to which
          portfolio securities which are purchased outside the United
          States are maintained in the custody of various foreign branches
          of The Chase Manhattan Bank and such other custodians, including
          foreign banks and foreign securities depositories in accordance
          with regulations under the Investment Company Act of 1940.  The
          Bank's main office is at 225 Franklin Street, Boston,
          Massachusetts 02110.  The address for The Chase Manhattan Bank,
          N.A., London is Woolgate House, Coleman Street, London, EC2P 2HD,
          England.


                                    CODE OF ETHICS

             The Funds' investment adviser (Price-Fleming) has a written
          Code of Ethics which requires all employees to obtain prior
          clearance before engaging in any personal securities
          transactions.  In addition, all employees must report their
          personal securities transactions within ten days of their
          execution.  Employees will not be permitted to effect
          transactions in a security: If there are pending client orders in
          the security; the security has been purchased or sold by a client
          within seven calendar days; the security is being considered for
          purchase for a client; the security is subject to internal
          trading restrictions.  In addition, employees are prohibited from
          engaging in short-term trading (e.g., purchases and sales
          involving the same security within 60 days.  Any material 


















          PAGE 134
          violation of the Code of Ethics is reported to the Board of the
          Fund.  The Board also reviews the administration of the Code of
          Ethics on an annual basis.


                                PORTFOLIO TRANSACTIONS

          Investment or Brokerage Discretion

             Decisions with respect to the purchase and sale of portfolio
          securities on behalf of the Fund are made by Price-Fleming. 
          Price-Fleming is also responsible for implementing these
          decisions, including the negotiation of commissions and the
          allocation of portfolio brokerage and principal business.  The
          Fund's purchases and sales of fixed-income portfolio securities
          are normally done on a principal basis and do not involve the
          payment of a commission although they may involve the designation
          of selling concessions.  That part of the discussion below
          relating solely to brokerage commissions would not normally apply
          to the Fund.  However, it is included because Price-Fleming does
          manage a significant number of common stock portfolios which do
          engage in agency transactions and pay commissions and because
          some research and services resulting from the payment of such
          commissions may benefit the Fund.

          How Brokers and Dealers are Selected

             Equity Securities

             In purchasing and selling each Fund's portfolio securities, it
          is Price-Fleming's policy to obtain quality execution at the most
          favorable prices through responsible broker-dealers and, in the
          case of agency transactions, at competitive commission rates
          where such rates are  negotiable.  However, under certain
          conditions, a Fund may pay higher brokerage commissions in return
          for brokerage and research services.  In selecting broker-dealers
          to execute a Fund's portfolio transactions, consideration is
          given to such factors as the price of the security, the rate of
          the commission, the size and difficulty of the order, the
          reliability, integrity, financial condition, general execution
          and operational capabilities of competing brokers and dealers,
          their expertise in particular markets and the brokerage and
          research services they provide to Price-Fleming or the Funds.  It
          is not the policy of Price-Fleming to seek the lowest available
          commission rate where it is believed that a broker or dealer
          charging a higher commission rate would offer greater reliability
          or provide better price or execution.


















          PAGE 135

             Transactions on stock exchanges involve the payment of
          brokerage commissions.  In transactions on stock exchanges in the
          United States, these commissions are negotiated.  Traditionally,
          commission rates have generally not been negotiated on stock
          markets outside the United States.  In recent years, however, an
          increasing number of overseas stock markets have adopted a system
          of negotiated rates, although a number of markets continue to be
          subject to an established schedule of minimum commission rates. 
          It is expected that equity securities will ordinarily be
          purchased in the primary markets, whether over-the-counter or
          listed, and that listed securities may be purchased in the
          over-the-counter market if such market is deemed the primary
          market.  In the case of securities traded on the over-the-counter
          markets, there is generally no stated commission, but the price
          usually includes an undisclosed commission or markup.  In
          underwritten offerings, the price includes a disclosed, fixed
          commission or discount.

             Fixed Income Securities

             For fixed income securities, it is expected that purchases and
          sales will ordinarily be transacted with the issuer, the issuer's
          underwriter, or with a primary market maker acting as principal
          on a net basis, with no brokerage commission being paid by the
          Fund.  However, the price of the securities generally includes
          compensation which is not disclosed separately.  Transactions
          placed though dealers who are serving as primary market makers
          reflect the spread between the bid and asked prices.

             With respect to equity and fixed income securities, Price-
          Fleming may effect principal transactions on behalf of the Funds
          with a broker or dealer who furnishes brokerage and/or research
          services, designate any such broker or dealer to receive selling
          concessions, discounts or other allowances or otherwise deal with
          any such broker or dealer in connection with the acquisition of
          securities in underwritings.  The prices the Fund pays to
          underwriters of newly-issued securities usually include a
          concession paid by the issuer to the underwriter.  Price-Fleming
          may receive research services in connection with brokerage
          transactions, including designations in fixed price offerings.

             Price-Fleming may cause a Fund to pay a broker-dealer who
          furnishes brokerage and/or research services a commission for
          executing a transaction that is in excess of the commission
          another broker-dealer would have received for executing the
          transaction if it is determined that such commission is 


















          PAGE 136
          reasonable in relation to the value of the brokerage and/or
          research services which have been provided.  In some cases,
          research services are generated by third parties but are provided
          to Price-Fleming by or through broker-dealers.

          Descriptions of Research Services Received from Brokers and
          Dealers

             Price-Fleming receives a wide range of research services from
          brokers and dealers covering investment opportunities throughout
          the world, including information on the economies, industries,
          groups of securities, individual companies, statistics, political
          developments, technical market action, pricing and appraisal
          services, and performance analyses of all the countries in which
          a Fund's portfolio is likely to be invested.  Price-Fleming
          cannot readily determine the extent to which commissions charged
          by brokers reflect the value of their research services, but
          brokers occasionally suggest a level of business they would like
          to receive in return for the brokerage and research services they
          provide.  To the extent that research services of value are
          provided by brokers, Price-Fleming may be relieved of expenses
          which it might otherwise bear.  In some cases, research services
          are generated by third parties but are provided to Price-Fleming
          by or through brokers.

          Commissions to Brokers who Furnish Research Services

             Certain broker-dealers which provide quality execution
          services also furnish research services to Price-Fleming.  Price-
          Fleming has adopted a brokerage allocation policy embodying the
          concepts of Section 28(e) of the Securities Exchange Act of 1934,
          which permits an investment adviser to cause its clients to pay a
          broker which furnishes brokerage or research services a higher
          commission than that which might be charged by another broker
          which does not furnish brokerage or research services, or which
          furnishes brokerage or research services deemed to be of lesser
          value, if such commission is deemed reasonable in relation to the
          brokerage and research services provided by the broker, viewed in
          terms of either that particular transaction or the overall
          responsibilities of the adviser with respect to the accounts as
          to which it exercises investment discretion.  Accordingly, Price-
          Fleming may assess the reasonableness of commissions in light of
          the total brokerage and research services provided by each
          particular broker.





















          PAGE 137
          Miscellaneous

             Research services furnished by brokers through which Price-
          Fleming effects securities transactions may be used in servicing
          all accounts managed by Price-Fleming,  Conversely, research
          services received from brokers which execute transactions for a
          particular Fund will not necessarily be used by Price-Fleming
          exclusively in connection with the management of that Fund.

             Some of Price-Fleming's other clients have investment
          objectives and programs similar to those of the Funds.  Price-
          Fleming may occasionally make recommendations to other clients
          which result in their purchasing or selling securities
          simultaneously with the Funds.  As a result, the demand for
          securities being purchased or the supply of securities being sold
          may increase, and this could have an adverse effect on the price
          of those securities.  It is Price-Fleming's policy not to favor
          one client over another in making recommendations or in placing
          orders.  Price-Fleming frequently follows the practice of
          grouping orders of various clients for execution which generally
          results in lower commission rates being attained.  In certain
          cases, where the aggregate order is executed in a series of
          transactions at various prices on a given day, each participating
          client's proportionate share of such order reflects the average
          price paid or received with respect to the total order.  Price-
          Fleming has established a general investment policy that it will
          ordinarily not make additional purchases of a common stock of a
          company for its clients (including the T. Rowe Price Funds) if,
          as a result of such purchases, 10% or more of the outstanding
          common stock of such company would be held by its clients in the
          aggregate.

             None of the Funds allocates business to any broker-dealer on
          the basis of its sales of the Fund's shares.  However, this does
          not mean that broker-dealers who purchase Fund shares for their
          clients will not receive business from the Fund.

          Transactions with Related Brokers and Dealers

             As provided in the Investment Management Agreement between
          each Fund and Price-Fleming, Price-Fleming is responsible not
          only for making decisions with respect to the purchase and sale
          of the Fund's portfolio securities, but also for implementing
          these decisions, including the negotiation of commissions and the
          allocation of portfolio brokerage and principal business.  It is
          expected that Price-Fleming will often place orders for a Fund's
          portfolio transactions with broker-dealers through the trading 


















          PAGE 138
          desks of certain affiliates of Robert Fleming Holdings Limited
          ("Robert Fleming"), an affiliate of Price-Fleming.  Robert
          Fleming, through Copthall Overseas Limited, a wholly-owned
          subsidiary, owns 25% of the common stock of Price-Fleming.  Fifty
          percent of the common stock of Price-Fleming is owned by TRP
          Finance, Inc., a wholly-owned subsidiary of T. Rowe Price, and
          the remaining 25% is owned by Jardine Fleming Holdings Limited, a
          subsidiary of Jardine Fleming Group Limited ("JFG").  JFG is 50%
          owned by Robert Fleming and 50% owned by Jardine Matheson
          Holdings Limited.  The affiliates through whose trading desks
          such orders may be placed include Fleming Investment Management
          Limited ("FIM"), and Robert Fleming & Co. Limited ("RF&Co."). 
          FIM and RF&Co. are wholly-owned subsidiaries of Robert Fleming. 
          These trading desks will operate under strict instructions from
          the Fund's portfolio manager with respect to the terms of such
          transactions.  Neither Robert Fleming, JFG, nor their affiliates
          will receive any commission, fee, or other remuneration for the
          use of their trading desks, although orders for a Fund's
          portfolio transactions may be placed with affiliates of Robert
          Fleming and JFG who may receive a commission.

             The Board of Directors of the Funds has authorized Price-
          Fleming to utilize certain affiliates of Robert Fleming and JFG
          in the capacity of broker in connection with the execution of
          each Fund's portfolio transactions, provided that Price-Fleming
          believes that doing so will result in an economic advantage (in
          the form of lower execution costs or otherwise) being obtained
          for each Fund.  These affiliates include Jardine Fleming
          Securities Limited ("JFS"), a wholly-owned subsidiary of JFG,
          RF&Co., Jardine Fleming Australia Securities Limited, and Robert
          Fleming, Inc. (a New York brokerage firm).

             The above-referenced authorization was made in accordance with
          Section 17(e) of the Investment Company Act of 1940 (the "1940
          Act") and Rule 17e-1 thereunder which require the Funds'
          independent directors to approve the procedures under which
          brokerage allocation to affiliates is to be made and to monitor
          such allocations on a continuing basis.  Except with respect to
          tender offers, it is not expected that any portion of the
          commissions, fees, brokerage, or similar payments received by the
          affiliates of Robert Fleming in such transactions will be
          recaptured by the Funds.  The directors have reviewed and from
          time to time may continue to review whether other recapture
          opportunities are legally permissible and available and, if they
          appear to be, determine whether it would be advisable for a Fund
          to seek to take advantage of them.



















          PAGE 139
          Other

                For the fiscal years ended December 31, 1994, December 31,
          1993, and December 31, 1992, the Global Government Bond Fund
          engaged in portfolio transactions involving broker-dealers
          totaling $642,836,742, $144,423,000, and $129,060,000,
          respectively.  The entire amounts for each year represented
          principal transactions as to which the Global Government Bond
          Fund has no knowledge of the profits or losses realized by the
          respective broker-dealers.  For the fiscal years ended December
          31, 1994, December 31, 1993, and December 31, 1992, and 0%, note
          of the transactions were placed with firms which provided
          research, statistical, or other services to Price-Fleming in
          connection with the management of the Global Government Bond Fund
          or, in some cases, to the Global Government Bond Fund.

             For the fiscal years ended December 31, 1994, December 31,
          1993, and December 31, 1992, the Short-Term Global Income Fund
          engaged in portfolio transactions involving broker-dealers
          totaling $899,655,114, $4,780,555,000 and $582,425,000,
          respectively.  The entire amount for the period represented
          principal transactions as to which the Short-Term Global Income
          Fund had no knowledge of the profits or losses realized by the
          respective dealers.  Of these portfolio transactions,
          approximately 0%, was paid to firms which provided research,
          statistical, or other services to Price-Fleming in connection
          with the management of the Short-Term Global Income Fund or, in
          some cases, to the Short-Term Global Income Fund.

             For the fiscal years ended December 31, 1994, December 31,
          1993, and December 31, 1992, the International Bond Fund engaged
          in portfolio transactions involving broker-dealers totaling
          $10,978,017,331, $157,373,000, and $6,813,188,000, respectively. 
          The entire amounts for each year represented principal
          transactions as to which the International Bond Fund has no
          knowledge of the profits or losses realized by the respective
          broker-dealers.  Of all such portfolio transactions, 0%, were
          placed with firms which provided research, statistical, or other
          services to Price-Fleming in connection with the management of
          the International Bond Fund or, in some cases, to the
          International Bond Fund.    


                                PRICING OF SECURITIES

             Fixed income securities are generally traded in the over-the-
          counter market and are valued at a price deemed best to reflect a


















          PAGE 140
          fair value as quoted by dealers who make markets in these
          securities or by an independent pricing service.
           
             For purposes of determining each Fund's net asset value per
          share, all assets and liabilities initially expressed in foreign
          currencies are converted into U.S. dollars at the mean of the bid
          and offer prices of such currencies against U.S. dollars quoted
          by any major bank.  If such quotations are not available, the
          rate of exchange will be determined in accordance with policies
          established in good faith by the Board of Directors.

             Securities or other assets for which the above valuation
          procedures are deemed not to reflect fair value will be appraised
          at prices deemed best to reflect their fair value.  Such
          determinations will be made in good faith by or under the
          supervision of the officers of the Fund, as authorized by the
          Board of Directors.

             Trading in the portfolio securities of each Fund may take
          place in various foreign markets on certain days (such as
          Saturday) when the Funds are not open for business and do not
          calculate their net asset values.  In addition, trading in a
          Fund's portfolio securities may not occur on days when the Fund
          is open.  The calculation of each Fund's net asset value normally
          will not take place contemporaneously with the determination of
          the value of the Fund's portfolio securities.  Events affecting
          the values of portfolio securities that occur between the time
          their prices are determined and the time each Fund's net asset
          value is calculated will not be reflected in the Fund's net asset
          value unless Price-Fleming, under the supervision of the Fund's
          Board of Directors, determines that the particular event should
          be taken into account in computing the Fund's net asset value.


                              NET ASSET VALUE PER SHARE

             The purchase and redemption price of each Fund's shares is
          equal to that Fund's net asset value per share or share price. 
          Each Fund determines its net asset value per share by subtracting
          its liabilities (including accrued expenses and dividends
          payable) from its total assets (the market value of the
          securities the Fund holds plus cash and other assets, including
          income accrued but not yet received) and dividing the result by
          the total number of shares outstanding.  The net asset value per
          share of each Fund is calculated as of the close of trading on
          the New York Stock Exchange ("NYSE") every day the NYSE is open
          for trading.  The NYSE is closed on the following days: New 


















          PAGE 141
          Year's Day, Washington's Birthday, Good Friday, Memorial Day,
          Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.

             Determination of net asset value (and the offering, sale,
          redemption and repurchase of shares) for a Fund may be suspended
          at times (a) during which the NYSE is closed, other than
          customary weekend and holiday closings, (b) during which trading
          on any of such Exchanges is restricted (c) during which an
          emergency exists as a result of which disposal by a Fund of
          securities owned by it is not reasonably practicable or it is not
          reasonably practicable for the Fund fairly to determine the value
          of its net assets, or (d) during which a governmental body having
          jurisdiction over the Fund may by order permit such a suspension
          for the protection of the Fund's shareholders; provided that
          applicable rules and regulations of the Securities and Exchange
          Commission (or any succeeding governmental authority) shall
          govern as to whether the conditions prescribed in (b), (c) or (d)
          exist.


                                      DIVIDENDS

             Unless you elect otherwise, the Fund's annual capital gain
          distributions, if any, will be reinvested on the reinvestment
          date using the NAV per share of that date.  The reinvestment date
          normally precedes the payment date by about 10 days although the
          exact timing is subject to change.


                                      TAX STATUS

             Each Fund intends to qualify as a "regulated investment
          company" under Subchapter M of the Internal Revenue Code of 1986,
          as amended ("Code").

             Dividends and distributions paid by the Funds are not eligible
          for the dividends-received deduction for corporate shareholders,
          if as expected, none of the Fund's income consists of dividends
          paid by United States corporations.  Capital gain distributions
          paid from these Funds are never eligible for this deduction.  For
          tax purposes, it does not make any difference whether dividends
          and capital gain distributions are paid in cash or in additional
          shares.  Each Fund must declare dividends by December 31 of each
          year equal to at least 98% of ordinary income (as of December 31)
          and capital gains (as of October 31) in order to avoid a federal
          excise tax and distribute within 12 months 100% of ordinary 



















          PAGE 142
          income and capital gains as of December 31 to avoid federal
          income tax.

             Foreign currency gains and losses, including the portion of
          gain or loss on the sale of debt securities attributable to
          foreign exchange rate fluctuations are taxable as ordinary
          income.  If the net effect of these transactions is a gain, the
          dividend paid by the fund will be increased; if the result is a
          loss, for the Funds, a portion of the income dividends paid could
          be classified as a return of capital.  Adjustments, to reflect
          these gains and losses will be made at the end of each Fund's
          taxable year.

             At the time of your purchase, each Bond Fund's net asset value
          may reflect undistributed capital gains or net unrealized
          appreciation of securities held by the Fund.  A subsequent
          distribution to you of such amounts, although constituting a
          return of your investment, would be taxable either as dividends
          or capital gain distributions.  For federal income tax purposes,
          each Fund is permitted to carry forward its net realized capital
          losses, if any, for eight years, and realize net capital gains up
          to the amount of such losses without being required to pay taxes
          on, or distribute such gains.  On March 31, 1994, the books of
          each Fund indicated that each Fund's aggregate net assets
          included undistributed net income, net realized capital gains or
          losses, and unrealized appreciation or depreciation which are
          listed below.

                                   Net Realized   Unrealized
            Fund                  Capital Losses Depreciation

          Short-Term Global Income $ 3,324,000   $ 2,554,000
          Global Government Bond       781,000       721,000
          International Bond        10,099,000    15,121,000

             Income received by each Fund from sources within various
          foreign countries may be subject to foreign income taxes withheld
          at the source.  Under the Code, if more than 50% of the value of
          a Fund's total assets at the close of its taxable year comprise
          securities issued by foreign corporations, the Fund may file an
          election with the Internal Revenue Service to "pass through" to
          the Fund's shareholders the amount of any foreign income taxes
          paid by the Fund.  Pursuant to this election, shareholders will
          be required to:  (i) include in gross income, even though not
          actually received, their respective pro rata share of foreign
          taxes paid by the Fund; (ii) treat their pro rata share of
          foreign taxes as paid by them; and (iii) either deduct their pro


















          PAGE 143
          rata share of foreign taxes in computing their taxable income, or
          use it as a foreign tax credit against U.S. income taxes (but not
          both).  No deduction for foreign taxes may be claimed by a
          shareholder who does not itemize deductions.

             Each Fund intends to meet the requirements of the Code to
          "pass through" to its shareholders foreign income taxes paid, but
          there can be no assurance that a Fund will be able to do so. 
          Each shareholder will be notified within 60 days after the close
          of each taxable year of a Fund, that Fund will "pass through"
          foreign taxes paid for that year, and, if so, the amount of each
          shareholder's pro rata share (by country) of (i) the foreign
          taxes paid, and (ii) the Fund's gross income from foreign
          sources.  Of course, shareholders who are not liable for federal
          income taxes, such as retirement plans qualified under Section
          401 of the Code, will not be affected by any such "pass through"
          of foreign tax credits.

             If, in any taxable year, a Fund should not qualify as a
          regulated investment company under the Code:  (i) the Fund would
          be taxed at normal corporate rates on the entire amount of its
          taxable income without deduction for dividends or other
          distributions to shareholders; (ii) the Fund's distributions to
          the extent made out of the Fund's current or accumulated earnings
          and profits would be taxable to shareholders as ordinary
          dividends (regardless of whether they would otherwise have been
          considered capital gain dividends), and the Funds would qualify
          for the 70% deduction for dividends received by corporations; and
          (iii) foreign tax credits would not "pass through" to
          shareholders.

          Passive Foreign Investment Companies

             The Fund may purchase the securities of certain foreign
          investment funds or trusts called passive foreign investment
          companies.  Capital gains on the sale of such holdings will be
          deemed to be ordinary income regardless of how long the Fund
          holds it investment.  In addition to bearing their proportionate
          share of the funds expenses (management fees and operating
          expenses) shareholders will also indirectly bear similar expenses
          of such funds.  In addition, the Fund may be subject to corporate
          income tax and an interest charge on certain dividends and
          capital gains earned from these investments, regardless of
          whether such income and gains were distributed to shareholders.

             In accordance with tax regulations, the Fund intends to treat
          these securities as sold on the last day of the Fund's fiscal 


















          PAGE 144
          year and recognize any gains for tax purposes at that time;
          losses will not be recognized.  Such gains will be considered
          ordinary income which the Fund will be required to distribute
          even though it has not sold the security and received cash to pay
          such distributions.

          Taxation of Foreign Shareholders

             The Code provides that dividends from net income (which are
          deemed to include for this purpose each shareholder's pro rata
          share of foreign taxes paid by each Fund - see discussion of
          "pass through" of the foreign tax credit to U.S. shareholders),
          will be subject to U.S. tax.  For shareholders who are not
          engaged in a business in the U.S., this tax would be imposed at
          the rate of 30% upon the gross amount of the dividend in the
          absence of a Tax Treaty providing for a reduced rate or exemption
          from U.S. taxation.  Distributions of net long-term capital gains
          realized by each Fund are not subject to tax unless the foreign
          shareholder is a nonresident alien individual who was physically
          present in the U.S. during the tax year for more than 182 days.


                                    CAPITAL STOCK

             The T. Rowe Price International Funds, Inc. (the
          "Corporation") was originally organized in 1979 as a Maryland
          corporation under the name T. Rowe Price International Fund, Inc.
          ("the Old Corporation").  Pursuant to the Annual Meeting of
          Shareholders held on April 22, 1986, an Agreement and Plan of
          Reorganization and Liquidation was adopted in order to convert
          the Old Corporation from a Maryland corporation to a
          Massachusetts Business Trust, named the T. Rowe Price
          International Trust ("the Trust").  This conversion became
          effective on May 1, 1986.  Pursuant to the Annual Meeting of
          Shareholders held on April 19, 1990, an Agreement and Plan of
          Reorganization and Liquidation was adopted in order to convert
          the Trust from a Massachusetts Business Trust to a Maryland
          corporation.  This conversion become effective May 1, 1990.  The
          Corporation is registered with the Securities and Exchange
          Commission under the 1940 Act as a diversified, open-end
          investment company, commonly known as a "mutual fund."

             Currently, the Corporation consists of nine series, each of
          which represents a separate class of the Corporation's shares and
          has different objectives and investment policies.  The
          International Bond Fund was added as a separate series of the
          Trust in 1986, and the designation of the existing series of the 


















          PAGE 145
          Trust was, at that time, changed to the International Stock Fund. 
          In 1988 and 1990, respectively, the International Discovery and
          European Stock Funds were added as separate series of the Trust. 
          Effective May 1, 1990, all series of the Trust became series of
          the Corporation.  In the same year, after the May 1, 1990
          reorganization, the New Asia and Global Government Bond Funds
          were added as separate series of the Corporation. The Japan,
          Short-Term Global Income and Latin America Funds were added as
          separate series of the Corporation in 1991, 1992, and 1993,
          respectively.  The International Stock, International Discovery,
          European Stock, Japan and New Asia Funds are described in a
          separate Statement of Additional Information. The Charter also
          provides that the Board of Directors may issue additional series
          of shares.

             The Funds' Charter authorizes the Board of Directors to
          classify and reclassify any and all shares which are then
          unissued, including unissued shares of capital stock into any
          number of classes or series, each class or series consisting of
          such number of shares and having such designations, such powers,
          preferences, rights, qualifications, limitations, and
          restrictions, as shall be determined by the Board subject to the
          Investment Company Act and other applicable law.  The shares of
          any such additional classes or series might therefore differ from
          the shares of the present class and series of capital stock and
          from each other as to preferences, conversion or other rights,
          voting powers, restrictions, limitations as to dividends,
          qualifications or terms or conditions of redemption, subject to
          applicable law, and might thus be superior or inferior to the
          capital stock or to other classes or series in various
          characteristics.  The Board of Directors may increase or decrease
          the aggregate number of shares of stock or the number of shares
          of stock of any class or series that each Fund has authorized to
          issue without shareholder approval.

             Each share of each series has equal voting rights with every
          other share of every other series, and all shares of all series
          vote as a single group except where a separate vote of any class
          or series is required by the 1940 Act, the laws of the State of
          Maryland, the Corporation's Articles of Incorporation, the By-
          Laws of the Corporation, or as the Board of Directors may
          determine in its sole discretion.  Where a separate vote is
          required with respect to one or more classes or series, then the
          shares of all other classes or series vote as a single class or
          series, provided that, as to any matter which does not affect the
          interest of a particular class or series, only the holders of
          shares of the one or more affected classes or series is entitled


















          PAGE 146
          to vote.  The preferences, rights, and other characteristics
          attaching to any series of shares, including the present series
          of capital stock, might be altered or eliminated, or the series
          might be combined with another series, by action approved by the
          vote of the holders of a majority of all the shares of all series
          entitled to be voted on the proposal, without any additional
          right to vote as a series by the holders of the capital stock or
          of another affected series.

             Shareholders are entitled to one vote for each full share held
          (and fractional votes for fractional shares held) and will vote
          in the election of or removal of directors (to the extent
          hereinafter provided) and on other matters submitted to the vote
          of shareholders.  There will normally be no meetings of
          shareholders for the purpose of electing directors unless and
          until such time as less than a majority of the directors holding
          office have been elected by shareholders, at which time the
          directors then in office will call a shareholders' meeting for
          the election of directors.  Except as set forth above, the
          directors shall continue to hold office and may appoint successor
          directors.  Voting rights are not cumulative, so that the holders
          of more than 50% of the shares voting in the election of
          directors can, if they choose to do so, elect all the directors
          of the Fund, in which event the holders of the remaining shares
          will be unable to elect any person as a director.  As set forth
          in the By-Laws of the Corporation, a special meeting of
          shareholders of the Corporation shall be called by the Secretary
          of the Corporation on the written request of shareholders
          entitled to cast at least 10% of all the votes of the
          Corporation, entitled to be cast at such meeting.  Shareholders
          requesting such a meeting must pay to the Corporation the
          reasonably estimated costs of preparing and mailing the notice of
          the meeting.  The Corporation, however, will otherwise assist the
          shareholders seeking to hold the special meeting in communicating
          to the other shareholders of the Corporation to the extent
          required by Section 16(c) of the 1940 Act.


                       FEDERAL AND STATE REGISTRATION OF SHARES

             Each Fund's shares are registered for sale under the
          Securities Act of 1933, and the Funds or their shares are
          registered under the laws of all states which require
          registration, as well as the District of Columbia and Puerto
          Rico.




















          PAGE 147
                                    LEGAL COUNSEL

                Shereff, Friedman, Hoffman, & Goodman, LLP, whose address
          is 919 Third Avenue, New York, New York 10022, is legal counsel
          to the Funds.    


                               INDEPENDENT ACCOUNTANTS

          International Bond and Emerging Markets Bond Funds

                Price Waterhouse LLP, 7 St. Paul Street, Suite 1700,
          Baltimore, Maryland 21202, are independent accountants to the
          Fund.  The financial statements of the International Bond Fund
          for the year ended December 31, 1994, and the report of
          independent accountants are included in the Fund's Annual Report
          for the year ended December 31, 1994, on pages 7-17.  A copy of
          the Annual Report accompanies this Statement of Additional
          Information.  The following financial statements and the report
          of independent accountants appearing in the Annual Report for the
          year ended December 31, 1994, are incorporated into this
          Statement of Additional Information by reference:

                                                 International
                                                   Bond Fund
                                                 Annual Report
                                                     Page
                                                  ___________

          Report of Independent Accountants           17
          Portfolio of Investments,
           December 31, 1994                         7-10
          Statement of Assets and Liabilities,
           December 31, 1994                          11
          Statement of Operations, year ended
           December 31, 1994                          12
          Statement of Changes in Net Assets,
           years ended December 31, 1994 and
           December 31, 1993                          13
          Notes to Financial Statements,
           December 31, 1994                         13-15
          Financial Highlights                      16    

          Short-Term Global Income and Global Government Bond Funds

                  Coopers & Lybrand L.L.P., 217 East Redwood Street,
          Baltimore, Maryland 21202, are independent accountants to each 


















          PAGE 148
          Fund.  The financial statements of the Short-Term Global Income
          and Global Government Bond Funds for the year ended December 31,
          1994, and the report of independent accountants are included in
          each Fund's Annual Report for the year ended December 31, 1994,
          on pages 8-22 and 11-22, respectively.  A copy of each Annual
          Report accompanies this Statement of Additional Information.  The
          following financial statements and the report of independent
          accountants appearing in each Annual Report for the year ended
          December 31, 1994, are incorporated into this Statement of
          Additional Information by reference:

                                                  Short-Term
                                                 Global Income
                                                  Fund Annual
                                                  Report Page
                                                  ___________

          Report of Independent Accountants           22
          Portfolio of Investments,
           December 31, 1994                         8-10
          Statement of Assets and Liabilities,
           December 31, 1994                          14
          Statement of Operations, year ended
           December 31, 1994                          15
          Statement of Changes in Net Assets,
           year ended December 31, 1994 and
           December 31, 1993                          16
          Notes to Financial Statements,
           December 31, 1994                         17-19
          Financial Highlights, years ended
           December 31, 1994, December 31, 1993
           and June 30, 1992 (Commencement of
           Operations) to December 31, 1992           20
































          PAGE 149
                                                    Global
                                                  Government
                                                   Bond Fund
                                                    Annual
                                                  Report Page
                                                  ___________

          Report of Independent Accountants           22
          Portfolio of Investments,
           December 31, 1994                         11-13
          Statement of Assets and Liabilities,
           December 31, 1994                          14
          Statement of Operations, year ended
           December 31, 1994                          15
          Statement of Changes in Net Assets,
           year ended December 31, 1994 and
           December 31, 1993                          16
          Notes to Financial Statements,
           December 31, 1994                         17-19
          Financial Highlights, years ended
           December 31, 1994, December 31, 1993,
           December 31, 1992 and December 28, 1990
           (Commencement of Operations) to
           December 31, 1991                          21


                         RATINGS OF CORPORATE DEBT SECURITIES

          Moody's Investors Services, Inc.

             Aaa - Bonds rated Aaa are judged to be of the best quality. 
          They carry the smallest degree of investment risk and are
          generally referred to as "gilt edge."

             Aa - Bonds rated Aa are judged to be of high quality by all
          standards.  Together with the Aaa group they comprise what are
          generally known as high grade bonds.

             A - Bonds rated A possess many favorable investment attributes
          and are to be considered as upper medium grade obligations.

             Baa - Bonds rated Baa are considered as medium grade
          obligations, i.e., they are neither highly protected nor poorly
          secured.  Interest payments and principal security appear
          adequate for the present but certain protective elements may be
          lacking or may be characteristically unreliable over any great
          length of time.  Such bonds lack outstanding investment 


















          PAGE 150
          characteristics and in fact have speculative characteristics as
          well.

             Ba-Bonds rated Ba are judged to have speculative elements:
          their futures cannot be considered as well assured.  Often the
          protection of interest and principal payments may be very
          moderate and thereby not well safeguarded during both good and
          bad times over the future.  Uncertainty of position characterize
          bonds in this class.

             B-Bonds rated B generally lack the characteristics of a
          desirable investment.  Assurance of interest and principal
          payments or of maintenance of other terms of the contract over
          any long period of time may be small.

             Caa-Bonds rated Caa are of poor standing.  Such issues may be
          in default or there may be present elements of danger with
          respect to principal or interest.

             Ca-Bonds rated Ca represent obligations which are speculative
          in a high degree.  Such issues are often in default or have other
          marked short-comings.

             C-Lowest-rated; extremely poor prospects of ever attaining
          investment standing.

          Standard & Poor's Corporation

             AAA - This is the highest rating assigned by Standard & Poor's
          to a debt obligation and indicates an extremely strong capacity
          to pay principal and interest.

             AA - Bonds rated AA also qualify as high-quality debt
          obligations.  Capacity to pay principal and interest is very
          strong.

             A - Bonds rated A have a strong capacity to pay principal and
          interest, although they are somewhat more susceptible to the
          adverse effects of changes in circumstances and economic
          conditions.

             BBB - Bonds rated BBB are regarded as having an adequate
          capacity to pay principal and interest.  Whereas they normally
          exhibit adequate protection parameters, adverse economic
          conditions or changing circumstances are more likely to lead to a
          weakened capacity to pay principal and interest for bonds in this
          category than for bonds in the A category.


















          PAGE 151

             BB, C, CCC, CC-Bonds rated BB, B, CCC, and CC are regarded on
          balance, as predominantly speculative with respect to the
          issuer's capacity to pay interest and repay principal.  BB
          indicates the lowest degree of speculation and CC the highest
          degree of speculation.  While such bonds will likely have some
          quality and protective characteristics, these are outweighed by
          large uncertainties or major risk exposures to adverse
          conditions.

             D-In default.






















































          PAGE 152
                                      APPENDIX A

          Chart 1

             A line graph follows which plots semiannual equivalent yields
          on 10-year government bonds from 1984 through 1994.  The yields
          for the United Kingdom, Germany, United States and Japan, during
          this time period, are graphed on a scale of 4 to 14. 

























































          PAGE 153
                                        PART C
                                  OTHER INFORMATION

          Item 24.  Financial Statements and Exhibits

          (a)  Financial Statements.

               International Bond, Global Government Bond and Short-Term
               Global Income Funds:

               Condensed Financial Information (Financial Highlights) for
               the Funds is included in Part A of the Registration
               Statement.

               Portfolio of Investments, Statement of Assets and
               Liabilities, Statement of Operations, and Statement of
               Changes in Net Assets of the Global Government Bond,
               International Bond and Short-Term Global Income Funds are
               included in each Fund's Annual Report to Shareholders, the
               pertinent portions of which are incorporated by reference in
               Part B of the Registration Statement.

               Emerging Markets Bond Fund:

               Inapplicable

          (b)  Exhibits.

               (1)(a)  Articles of Amendment and Restatement of T. Rowe
                       Price International Funds, Inc., dated February 16,
                       1990 (electronically filed with Amendment No. 42
                       dated February 28, 1994)

               (1)(b)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc., dated March 4, 1991

               (1)(c)  Articles of Amendment of T. Rowe Price International
                       Funds, Inc., dated May 1, 1991

               (1)(d)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc., dated October 18, 1991

               (1)(e)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc., dated May 4, 1992
                       (electronically filed with Amendment No. 44 dated
                       December 22, 1994)



















          PAGE 154
               (1)(f)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc., dated November 4, 1993
                       (electronically filed with Amendment No. 41 dated
                       December 16, 1993)

               (1)(g)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc. dated February 18, 1994
                       (electronically filed with Amendment No. 42 dated
                       February 28, 1994)

               (1)(h)  Articles Supplementary of T. Rowe Price
                       International Funds, Inc. dated November 2, 1994
                       (electronically filed with Amendment No. 44 dated
                       December 22, 1994)

               (2)     By-Laws of Registrant, as amended to May 1, 1991 and
                       September 30, 1993 (electronically filed with
                       Amendment No. 41 dated December 16, 1993)

               (3)     Inapplicable

               (4)(a)  Specimen Stock Certificate for International Bond
                       Fund (filed with Amendment No. 10)

               (4)(b)  Specimen Stock Certificate for International Stock
                       Fund (filed with Amendment No. 10)

               (4)(c)  Specimen Stock Certificate for International
                       Discovery Fund (filed with Amendment No. 14)

               (4)(d)  Specimen Stock Certificate for European Stock Fund
                       (filed with Amendment No. 18)

               (4)(e)  Specimen Stock Certificate for New Asia Fund (filed
                       with Amendment No. 21)

               (4)(f)  Specimen Stock Certificate for Global Government
                       Bond Fund (filed with Amendment No. 24)

               (4)(g)  T. Rowe Price Japan Fund and T. Rowe Price Short-
                       Term Global Income Fund.  See Article FIFTH, Capital
                       Stock, Paragraphs (A)-(E) of the Articles of
                       Amendment and Restatement electronically filed with
                       Amendment No. 19, Article II, Shareholders, Sections
                       2.01-2.11 and Article VIII, Capital Stock, Sections
                       8.01-8.06 of the Bylaws (filed with Amendment No.
                       19)


















          PAGE 155
               (5)(a)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price International Bond Fund,
                       dated May 1, 1990 (electronically filed with
                       Amendment No. 42 dated February 28, 1994)

               (5)(b)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price International Stock Fund,
                       dated May 1, 1990 (electronically filed with
                       Amendment No. 42 dated February 28, 1994)

               (5)(c)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price International Discovery
                       Fund, dated May 1, 1991 (electronically filed with
                       Amendment No. 42 dated February 28, 1994)

               (5)(d)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price European Stock Fund, dated
                       May 1, 1990 (electronically filed with Amendment No.
                       42 dated February 28, 1994)

               (5)(e)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price New Asia Fund, dated May 1,
                       1991 (electronically filed with Amendment No. 42
                       dated February 28, 1994)

               (5)(f)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price Global Government Bond Fund,
                       dated November 7, 1990 (electronically filed with
                       Amendment No. 42 dated February 28, 1994)

               (5)(g)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price Japan Fund, dated November
                       6, 1991 (electronically filed with Amendment No. 42
                       dated February 28, 1994)

               (5)(h)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price Short-Term Global Income
                       Fund, dated April 23, 1992 (electronically filed
                       with Amendment No. 42 dated February 28, 1994)


















          PAGE 156
               (5)(i)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price Latin America Fund, dated
                       November 3, 1993 (electronically filed with
                       Amendment No. 41 dated December 16, 1993)

               (5)(j)  Investment Management Agreement between Registrant
                       and Rowe Price-Fleming International, Inc., on
                       behalf of T. Rowe Price Emerging Markets Bond Fund,
                       dated November 2, 1994 (electronically filed with
                       Amendment No. 44 dated December 22, 1994)

               (6)     Underwriting Agreement between Registrant and T.
                       Rowe Price Investment Services, Inc., dated May 1,
                       1990 (electronically filed with Amendment No. 42
                       dated February 28, 1994)

               (7)     Inapplicable

               (8)(a)  Custodian Agreement between T. Rowe Price Funds and
                       State Street Bank and Trust Company dated September
                       28, 1987, as amended June 24, 1988, October 19,
                       1988, February 22, 1989, July 19, 1989, September
                       15, 1989, December 15, 1989, December 20, 1989,
                       January 25, 1990, February 21, 1990, June 12, 1990,
                       July 18, 1990, October 15, 1990, February 13, 1991,
                       March 6, 1991, September 12, 1991, November 6, 1991,
                       April 23, 1992, September 2, 1992, November 3, 1992,
                       December 16, 1992, December 21, 1992, January 28,
                       1993, April 22, 1993, September 16, 1993, November
                       3, 1993, March 1, 1994, April 21, 1994, July 27,
                       1994, September 21, 1994, November 1, 1994, and
                       November 2, 1994

               (8)(b)  Global Custody Agreement between The Chase Manhattan
                       Bank, N.A. and T. Rowe Price Funds, dated January 3,
                       1994, as amended April 18, 1994, August 15, 1994,
                       and November 28, 1994

               (9)(a)  Transfer Agency and Service Agreement between T.
                       Rowe Price Services, Inc. and T. Rowe Price Funds,
                       dated January 1, 1995, as amended January 25, 1995

               (9)(b)  Agreement between T. Rowe Price Associates, Inc. and
                       T. Rowe Price Funds for Fund Accounting Services,
                       dated January 1, 1995, as amended January 25, 1995



















          PAGE 157
               (9)(c)  Agreement between T. Rowe Price Retirement Plan
                       Services, Inc. and the Taxable Funds, dated January
                       1, 1995, as amended January 25, 1995    

               (10)    Inapplicable

               (11)    Consent of Independent Accountants

               (12)    Inapplicable

               (13)    Inapplicable

               (14)    Inapplicable

               (15)    Inapplicable

               (16)(a) Total Return Performance Methodology

               (16)(b) T. Rowe Price Global Government Bond Fund; T. Rowe
                       Price International Bond Fund; and T. Rowe Price
                       Short-Term Global Income Fund.  The Registrant
                       hereby incorporates by reference the methodology
                       used in calculating the performance information
                       included in Post-Effective Amendment No. 34 and
                       Amendment No. 12 of the T. Rowe Price New Income
                       Fund, Inc. (SEC. File Nos. 2-48848 and 811-2396)
                       dated April 27, 1988.

               (17)    Financial Data Schedule for T. Rowe Price Global
                       Government Bond Fund, T. Rowe Price International
                       Bond Fund, T. Rowe Price Short-Term Global Income
                       Fund, and T. Rowe Price Emerging Markets Bond Fund
                       as of December 22, 1994

          Item 25.  Persons Controlled by or Under Common Control With
                    Registrant.

                    None.

          Item 26.  Number of Holders of Securities

               As of December 31, 1994, there were 265,286 shareholders in
          the T. Rowe Price International Stock Fund.

               As of December 31, 1994, there were 42,556 shareholders in
          the T. Rowe Price International Discovery Fund.



















          PAGE 158
               As of December 31, 1994, there were 34,618 shareholders in
          the T. Rowe Price European Stock Fund.

               As of December 31, 1994, there were 182,914 shareholders in
          the T. Rowe Price New Asia Fund.

               As of January 31, 1995, there were 2,394 shareholders in the
          T. Rowe Price Global Government Bond Fund.

               As of January 31, 1995, there were 26,930 shareholders in
          the T. Rowe Price International Bond Fund.

               As of January 31, 1995, there were 3,150 shareholders in the
          T. Rowe Price Short-Term Global Income Fund.

               As of December 31, 1994, there were 17,523 shareholders in
          the T. Rowe Price Japan Fund.

               As of December 31, 1994, there were 25,288 shareholders in
          the T. Rowe Price Latin America Fund.

               As of January 31, 1995 there were 16 shareholders in the T.
          Rowe Price Emerging Markets Bond Fund.    

          Item 27.  Indemnification

          The Registrant maintains comprehensive Errors and Omissions and
          Officers and Directors insurance policies written by the Evanston
          Insurance Company, The Chubb Group and ICI Mutual.  These
          policies provide coverage for the named insureds, which include
          T. Rowe Price Associates, Inc. ("Price Associates"), Rowe Price-
          Fleming International, Inc., T. Rowe Price Investment Services,
          Inc., T. Rowe Price Services, Inc., T. Rowe Price Trust Company,
          T. Rowe Price Stable Asset Management, Inc., RPF International
          Bond Fund and thirty-nine other investment companies, namely, T.
          Rowe Price Growth Stock Fund, Inc., T. Rowe Price New Horizons
          Fund, Inc., T. Rowe Price New Era Fund, Inc., T. Rowe Price New
          Income Fund, Inc., T. Rowe Price Prime Reserve Fund, Inc., T.
          Rowe Price Tax-Free Income Fund, Inc., T. Rowe Price Tax-Exempt
          Money Fund, Inc., T. Rowe Price Growth & Income Fund, Inc., T.
          Rowe Price Tax-Free Short-Intermediate Fund, Inc., T. Rowe Price
          Short-Term Bond Fund, Inc., T. Rowe Price High Yield Fund, Inc.,
          T. Rowe Price Tax-Free High Yield Fund, Inc., T. Rowe Price New
          America Growth Fund, T. Rowe Price Equity Income Fund, T. Rowe
          Price GNMA Fund, T. Rowe Price Capital Appreciation Fund, T. Rowe
          Price State Tax-Free Income Trust, T. Rowe Price California Tax-
          Free Income Trust, T. Rowe Price Science & Technology Fund, Inc.,


















          PAGE 159
          T. Rowe Price Small-Cap Value Fund, Inc., Institutional
          International Funds, Inc., T. Rowe Price U.S. Treasury Funds,
          Inc., T. Rowe Price Index Trust, Inc., T. Rowe Price Spectrum
          Fund, Inc., T. Rowe Price Balanced Fund, Inc., T. Rowe Price
          Adjustable Rate U.S. Government Fund, Inc., T. Rowe Price Mid-Cap
          Growth Fund, Inc., T. Rowe Price OTC Fund, Inc., T. Rowe Price
          Tax-Free Insured Intermediate Bond Fund, Inc., T. Rowe Price
          Dividend Growth Fund, Inc., T. Rowe Price Blue Chip Growth Fund,
          Inc., T. Rowe Price Summit Funds, Inc., T. Rowe Price Summit
          Municipal Funds, Inc., T. Rowe Price Equity Series, Inc., T. Rowe
          Price International Series, Inc., T. Rowe Price Fixed Income
          Series, Inc., T. Rowe Price Personal Strategy Funds, Inc., T.
          Rowe Price Value Fund, Inc., and T. Rowe Price Capital
          Opportunity Fund, Inc.  The Registrant and the thirty-nine
          investment companies listed above, with the exception of T. Rowe
          Price Equity Series, Inc., T. Rowe Price Fixed Income Series,
          Inc., T. Rowe Price International Series, Inc. and Institutional
          International Funds, Inc., will be collectively referred to as
          the Price Funds.  With respect to all such Price Funds excluding
          the Registrant, T. Rowe Price International Series, Inc. and
          Institutional International Funds, Inc., their investment manager
          is Price Associates.  The investment manager to the Registrant,
          T. Rowe Price International Series, Inc., and Institutional
          International Funds, Inc. is Rowe Price-Fleming International,
          Inc. ("Manager") which is 50% owned by TRP Finance, Inc., a
          wholly-owned subsidiary of Price Associates, 25% owned by
          Copthall Overseas Limited, a wholly-owned subsidiary of Robert
          Fleming Holdings Limited, and 25% owned by Jardine Fleming
          International Holdings Limited.  In addition to the corporate
          insureds, the policies also cover the officers, directors, and
          employees of each of the named insureds.  The premium is
          allocated among the named corporate insureds in accordance with
          the provisions of Rule 17d-1(d)(7) under the Investment Company
          Act of 1940.

               Article X, Section 10.01 of the Registrant's By-Laws
          provides as follows:

                    Section 10.01.  Indemnification and Payment of Expenses
               in Advance:  The Corporation shall indemnify any individual
               ("Indemnitee") who is a present or former director, officer,
               employee, or agent of the Corporation, or who is or has been
               serving at the request of the Corporation as a director,
               officer, employee or agent of another corporation,
               partnership, joint venture, trust or other enterprise, who,
               by reason of his position was, is, or is threatened to be
               made a party to any threatened, pending, or completed 


















          PAGE 160
               action, suit, or proceeding, whether civil, criminal,
               administrative, or investigative (hereinafter collectively
               referred to as a "Proceeding") against any judgments,
               penalties, fines, settlements, and reasonable expenses
               (including attorneys' fees) incurred by such Indemnitee in
               connection with any Proceeding, to the fullest extent that
               such indemnification may be lawful under Maryland law.  The
               Corporation shall pay any reasonable expenses so incurred by
               such Indemnitee in defending a Proceeding in advance of the
               final disposition thereof to the fullest extent that such
               advance payment may be lawful under Maryland law.  Subject
               to any applicable limitations and requirements set forth in
               the Corporation's Articles of Incorporation and in these By-
               Laws, any payment of indemnification or advance of expenses
               shall be made in accordance with the procedures set forth in
               Maryland law.

                    Notwithstanding the foregoing, nothing herein shall
               protect or purport to protect any Indemnitee against any
               liability to which he would otherwise be subject by reason
               of willful misfeasance, bad faith, gross negligence, or
               reckless disregard of the duties involved in the conduct of
               his office ("Disabling Conduct").

                    Anything in this Article X to the contrary
               notwithstanding, no indemnification shall be made by the
               Corporation to any Indemnitee unless:

                    (a)  there is a final decision on the merits by a court
                         or other body before whom the Proceeding was
                         brought that the Indemnitee was not liable by
                         reason of Disabling Conduct; or

                    (b)  in the absence of such a decision, there is a
                         reasonable determination, based upon a review of
                         the facts, that the Indemnitee was not liable by
                         reason of Disabling Conduct, which determination
                         shall be made by:

                         (i)  the vote of a majority of a quorum of
                              directors who are neither "interested
                              persons" of the Corporation as defined in
                              Section 2(a)(19) of the Investment Company
                              Act of 1940, nor parties to the Proceeding;
                              or




















          PAGE 161
                         (ii) an independent legal counsel in a written
                              opinion.

                    Anything in this Article X to the contrary
               notwithstanding, any advance of expenses by the Corporation
               to any Indemnitee shall be made only upon the undertaking by
               such Indemnitee to repay the advance unless it is ultimately
               determined that such Indemnitee is entitled to
               indemnification as above provided, and only if one of the
               following conditions is met:

                    (a)  the Indemnitee provides a security for his
                         undertaking; or

                    (b)  the Corporation shall be insured against losses
                         arising by reason of any lawful advances; or

                    (c)  there is a determination, based on a review of
                         readily available facts, that there is reason to
                         believe that the Indemnitee will ultimately be
                         found entitled to indemnification, which
                         determination shall be made by:

                         (i)  a majority of a quorum of directors who are
                              neither "interested persons" of the
                              Corporation as defined in Section 2(a)(19) of
                              the Investment Company Act, nor parties to
                              the Proceeding; or

                         (ii) an independent legal counsel in a written
                              opinion.

               Section 10.02 of the Registrant's By-Laws provides as
          follows:

                    Section 10.02.  Insurance of Officers, Directors,
               Employees and Agents:  To the fullest extent permitted by
               applicable Maryland law and by Section 17(h) of the
               Investment Company Act, as from time to time amended, the
               Corporation may purchase and maintain insurance on behalf of
               any person who is or was a director, officer, employee, or
               agent of the Corporation, or who is or was serving at the
               request of the Corporation as a director, officer, employee,
               or agent of another corporation, partnership, joint venture,
               trust, or other enterprise, against any liability asserted
               against him and incurred by him in or arising out of his 



















          PAGE 162
               position, whether or not the Corporation would have the
               power to indemnify him against such liability.

               Insofar as indemnification for liability arising under the
               Securities Act of 1933 may be permitted to directors,
               officers and controlling persons of the Registrant pursuant
               to the foregoing provisions, or otherwise, the Registrant
               has been advised that in the opinion of the Securities and
               Exchange Commission such indemnification is against public
               policy as expressed in the Act and is, therefore,
               unenforceable.  In the event that a claim for
               indemnification against such liabilities (other than the
               payment by the Registrant of expenses incurred or paid by a
               director, officer or controlling person of the Registrant in
               the successful defense of any action, suit or proceeding) is
               asserted by such director, officer or controlling person in
               connection with the securities being registered, the
               Registrant will, unless in the opinion of its counsel the
               matter has been settled by controlling precedent, submit to
               a court of appropriate jurisdiction the question whether
               such indemnification by it is against public policy as
               expressed in the Act and will be governed by the final
               adjudication of such issue.

          Item 28. Business and Other Connections of Investment Manager.

             M. David Testa, who is Chairman of the Board of the Manager,
          is presently a Director and Managing Director of Price Associates
          and a Director of T. Rowe Price Trust Company.    

          George J. Collins, a Director of the Manager, is Chief Executive
          Officer, President, and a Managing Director of Price Associates.

          D. William J. Garrett, a Director of the Manager, is Chairman of
          Robert Fleming Securities Limited, a Director of Robert Fleming
          Holdings Limited ("Robert Fleming Holdings"), a parent of the
          Manager which is a United Kingdom holding company duly organized
          and existing under the laws of the United Kingdom, Robert Fleming
          Management Services Limited, Robert Fleming Management Services
          Limited, Robert Fleming & Co. Limited, and Fleming Investments
          Limited.  Mr. Garrett also serves as Director and/or officer of
          other companies related to or affiliated with the above listed
          companies.

          P. John Manser, a Director of the Manager, is Chief Executive of
          Robert Fleming Holdings, Chairman of Robert Fleming & Co.
          Limited, Director of Jardine Fleming Group Limited, Robert 


















          PAGE 163
          Fleming Management Services Limited, Fleming Investment
          Management Limited, Robert Fleming Asset Management Limited,
          Jardine Fleming Holdings Limited, and Robert Fleming Asset
          Management Limited and also serves as a director of the U.K.
          Securities and Investments Board.  Mr. Manser also serves as
          Director and/or officer of other companies related to or
          affiliated with the above listed companies.

             James S. Riepe, a Director of T. Rowe Price; Chairman of the
          Board, T. Rowe Price Services, Inc., T. Rowe Price Retirement
          Plan Services, Inc. and T. Rowe Price Trust Company; President
          and Director, T. Rowe Price Investment Services, Inc.; Director,
          Rhone-Poulenc Rorer, Inc.    

          George A. Roche, a Vice President and a Director of the Manager,
          is Chief Financial Officer and a Managing Director of Price
          Associates.

          Alan H. Smith, a Director of the Manager, is Managing Director of
          Jardine Fleming Group Limited and Jardine Fleming Holdings
          Limited, Chairman of Jardine Fleming Investment Management
          Limited, Jardine Fleming & Company Limited and Jardine Fleming
          Securities Limited and a Director of Robert Fleming Holdings. 
          Mr. Smith also serves as Director and/or officer of other
          companies related to or affiliated with the above listed
          companies.

             Henry C. T. Strutt, a Director of the Manager, is Managing
          Director and General Manager of Jardine Fleming Holdings Ltd. and
          Director of Robert Fleming Holdings Ltd.    

          Alvin M. Younger, Jr., the Secretary and Treasurer of the
          Manager, is a Managing Director and the Secretary and Treasurer
          of Price Associates.

              Martin G. Wade, President, Price-Fleming; Director, Robert
          Fleming Holdings Limited.    

             With the exception of Christopher D. Alderson, Peter B. Askew,
          Richard J. Bruce, Ann B. Cranmer, Mark J. T. Edwards, John R.
          Ford, Christopher Rothery, James B. M. Seddon, Benedict R. F.
          Thomas, David J. L. Warren, and Martin G. Wade, all officers of
          the Manager are officers and/or employees of Price Associates and
          may also be officers and/or directors of one or more subsidiaries
          of Price Associates and/or one or more of the registered
          investment companies which Price Associates or the Manager serves
          as investment adviser.  Mr. Ilott is an employee of Fleming 


















          PAGE 164
          Investment Management Limited, an investment adviser registered
          under the Investment Advisers Act of 1940.  Ms. Cranmer is an
          employee of Fleming Investment Management Limited.  Mr. Wade, who
          is President of the Manager, is also a Non-Executive Director of
          Robert Fleming Holdings.    

             RPFI International Partners, Limited Partnership, is a
          Delaware limited partnership organized in 1985 for the purpose of
          investing in a diversified group of small and medium-sized non-
          U.S. companies.  The Manager is the general partner of this
          partnership, and certain institutional investors, including
          advisory clients of the Manager are its limited partners.    

          See also "Management of Fund," in the Registrant's Statement of
          Additional Information.

          Item 29.  Principal Underwriters.

               (a)  The principal underwriter for the Registrant is
          Investment Services.  Investment Services acts as the principal
          underwriter for the other sixty-three Price Funds.  Investment
          Services is a wholly-owned subsidiary of the Manager, is
          registered as a broker-dealer under the Securities Exchange Act
          of 1934 and is a member of the National Association of Securities
          Dealers, Inc.  Investment Services has been formed for the
          limited purpose of distributing the shares of the Price Funds and
          will not engage in the general securities business.  Since the
          Price Funds are sold on a no-load basis, Investment Services will
          not receive any commissions or other compensation for acting as
          principal underwriter.

               (b)  The address of each of the directors and officers of
          Investment Services listed below is 100 East Pratt Street,
          Baltimore, Maryland 21202.

                                                             Positions and
          Name and Principal        Positions and Offices    Offices With
          Business Address          With Underwriter         Registrant
          __________________        ______________________   ______________

          James S. Riepe            President and Director   Vice President
          Henry H. Hopkins          Vice President and       Vice President
                                    Director
          Mark E. Rayford           Director                 None
          Charles E. Vieth          Vice President and       None
                                    Director
          Patricia M. Archer        Vice President           None


















          PAGE 165
          Edward C. Bernard         Vice President           None
          Joseph C. Bonasorte       Vice President           None
          Meredith C. Callanan      Vice President           None
          Laura H. Chasney          Vice President           None
          Victoria C. Collins       Vice President           None
          Christopher W. Dyer       Vice President           None
          Forrest R. Foss           Vice President           None
          Patricia O. Goodyear      Vice President           None
          James W. Graves           Vice President           None
          Andrea G. Griffin         Vice President           None
          David J. Healy            Vice President           None
          Joseph P. Healy           Vice President           None
          Walter J. Helmlinger      Vice President           None
          Eric G. Knauss            Vice President           None
          Douglas G. Kremer         Vice President           None
          Sharon Renae Krieger      Vice President           None
          Keith Wayne Lewis         Vice President           None
          David A. Lyons            Vice President           None
          Sarah McCafferty          Vice President           None
          Maurice A. Minerbi        Vice President           None
          Nancy M. Morris           Vice President           None
          George A. Murnaghan       Vice President           Vice President
          Steven E. Norwitz         Vice President           None
          Kathleen M. O'Brien       Vice President           None
          Pamela D. Preston         Vice President           None
          Lucy B. Robins            Vice President           None
          John R. Rockwell          Vice President           None
          Monica R. Tucker          Vice President           None
          William F. Wendler, II    Vice President           Vice President
          Terrie L. Westren         Vice President           None
          Jane F. White             Vice President           None
          Thomas R. Woolley         Vice President           None
          Alvin M. Younger, Jr.     Secretary and Treasurer  None
          Mark S. Finn              Controller               None
          Richard J. Barna          Assistant Vice President None
          Catherine L. Berkenkemper Assistant Vice President None
          Ronae M Brock             Assistant Vice President None
          Brenda E. Buhler          Assistant Vice President None
          Patricia S. Butcher       Assistant Vice President Assistant
                                                             Secretary
          John A. Galateria         Assistant Vice President None
          Janelyn A. Healey         Assistant Vice President None
          Keith J. Langrehr         Assistant Vice President None
          C. Lillian Matthews       Assistant Vice President None
          Janice D. McCrory         Assistant Vice President None
          Sandra J. McHenry         Assistant Vice President None
          JeanneMarie B. Patella    Assistant Vice President None


















          PAGE 166
          Kristin E. Seeberger      Assistant Vice President None
          Arthur J. Siber           Assistant Vice President None
          Anne B. Winter            Assistant Vice President None
          Linda C. Wright           Assistant Vice President None
          Nolan L. North            Assistant Treasurer      None
          Barbara A. VanHorn        Assistant Secretary      None

               (c)  Not applicable.  Investment Services will not receive
          any compensation with respect to its activities as underwriter
          for the Price Funds since the Price Funds are sold on a no-load
          basis.

          Item 30.  Location of Accounts and Records.

               All accounts, books, and other documents required to be
          maintained by T. Rowe Price International Funds, Inc. under
          Section 31(a) of the Investment Company Act of 1940 and the rules
          thereunder will be maintained by T. Rowe Price International
          Funds, Inc. at its offices at 100 East Pratt Street, Baltimore,
          Maryland 21202.  Transfer, dividend disbursing, and shareholder
          service activities are performed by T. Rowe Price Services, Inc.,
          at 100 East Pratt Street, Baltimore, Maryland 21202.  Custodian
          activities for T. Rowe Price International Funds, Inc. are
          performed at State Street Bank and Trust Company's Service Center
          (State Street South), 1776 Heritage Drive, Quincy, Massachusetts
          02171.  Custody of Fund portfolio securities which are purchased
          outside the United States is maintained by The Chase Manhattan
          Bank, N.A., London in its foreign branches or with other U.S.
          banks.  The Chase Manhattan Bank, N.A., London is located at
          Woolgate House, Coleman Street, London EC2P 2HD, England.

          Item 31.  Management Services.

               Registrant is not a party to any management related service
               contract, other than as set forth in the Prospectus.

          Item 32.  Undertakings.

               (a)  Inapplicable.

               (b)  The Emerging Markets Bond Fund will file, within four
                    to six months from the effective date of its
                    registration statement, a post-effective amendment
                    using financial statements which need not be certified.





















          PAGE 167
               (c)  If requested to do so by the holders of at least 10% of
                    all votes entitled to be cast, the Registrant will call
                    a meeting of shareholders for the purpose of voting on
                    the question of removal of a director or directors and
                    will assist in communications with other shareholders
                    to the extent required by Section 16(c).

               (d)  Each series of the Registrant agrees to furnish, upon
                    request and without charge, a copy of its latest Annual
                    Report to each person to whom its prospectus is
                    delivered.






















































          PAGE 168
               Pursuant to the requirements of the Securities Act of 1933,
          as amended, and the Investment Company Act of 1940, as amended,
          the Registrant has duly caused this Registration Statement to be
          signed on its behalf by the undersigned, thereunto duly
          authorized, in the City of Baltimore, State of Maryland, this 1st
          day of March, 1995.

                                        T. ROWE PRICE INTERNATIONAL FUNDS,
                                        INC.
                                        /s/M. David Testa
                                        By:  M. David Testa
                                             Chairman of the Board

               Pursuant to the requirements of the Securities Act of 1933,
          as amended, this Registration Statement has been signed below by
          the following persons in the capacities and on the dates
          indicated:

          SIGNATURE                       TITLE                DATE
          _________                      ______                _____

          /s/M. David Testa       Chairman of the Board    March 1, 1995
          M. David Testa        (Chief Executive Officer)

          /s/Carmen F. Deyesu           Treasurer          March 1, 1995
          Carmen F. Deyesu      (Chief Financial Officer)

          /s/Martin G. Wade      President and Director    March 1, 1995
          Martin G. Wade

          /s/Leo C. Bailey              Director           March 1, 1995
          Leo C. Bailey

          /s/Anthony W. Deering         Director           March 1, 1995
          Anthony W. Deering

          /s/Donald W. Dick, Jr.        Director           March 1, 1995
          Donald W. Dick, Jr.

          /s/Addison Lanier             Director           March 1, 1995
          Addison Lanier
























          
 The Custodian Agreement dated September 28, 1987, as
          amended, between State Street Bank and Trust Company and T. Rowe
          Price Funds should be inserted here.
             






          PAGE 1
                                  CUSTODIAN CONTRACT
                                       Between
                         STATE STREET BANK AND TRUST COMPANY
                                         and
                            EACH OF THE PARTIES INDICATED
                                    ON APPENDIX A
                              DATED: SEPTEMBER 28, 1987


          FRF 07/87























































          PAGE 2
                                  TABLE OF CONTENTS

          1.  Employment of Custodian and Property to be Held By It1
          2.  Duties of the Custodian with Respect to Property of the Fund
                Held by the Custodian in the United States.   . .  2
              2.1   Holding Securities  . . . . . . . . . . . . .  2
              2.2   Delivery of Securities  . . . . . . . . . . .  2
                    1)  Sale  . . . . . . . . . . . . . . . . . .  2
                    2)  Repurchase Agreement  . . . . . . . . . .  2
                    3)  Securities System . . . . . . . . . . . .  3
                    4)  Tender Offer  . . . . . . . . . . . . . .  3
                    5)  Redemption by Issuer  . . . . . . . . . .  3
                    6)  Transfer to Issuer, Nominee, Exchange . .  3
                    7)  Sale to Broker  . . . . . . . . . . . . .  3
                    8)  Exchange or Conversion  . . . . . . . . .  4
                    9)  Warrants, Rights  . . . . . . . . . . . .  4
                    10) Loans of Securities . . . . . . . . . . .  4
                    11) Borrowings  . . . . . . . . . . . . . . .  4
                    12) Options . . . . . . . . . . . . . . . . .  5
                    13) Futures . . . . . . . . . . . . . . . . .  5
                    14) In-Kind Distributions . . . . . . . . . .  5
                    15) Miscellaneous . . . . . . . . . . . . . .  5
                    16) Type of Payment . . . . . . . . . . . . .  6
              2.3   Registration of Securities  . . . . . . . . .  6
              2.4   Bank Accounts . . . . . . . . . . . . . . . .  7
              2.5   Sale of Shares and Availability of Federal Funds7
              2.6   Collection of Income, Dividends . . . . . . .  7
              2.7   Payment of Fund Monies  . . . . . . . . . . .  8
                    1)  Purchases . . . . . . . . . . . . . . . .  8
                    2)  Exchanges . . . . . . . . . . . . . . . .  9
                    3)  Redemptions . . . . . . . . . . . . . . .  9
                    4)  Expense and Liability . . . . . . . . . .  9
                    5)  Dividends . . . . . . . . . . . . . . . .  9
                    6)  Short Sale Dividend . . . . . . . . . . . 10
                    7)  Loan  . . . . . . . . . . . . . . . . . . 10
                    8)  Miscellaneous . . . . . . . . . . . . . . 10
              2.8   Liability for Payment in Advance of Receipt of 
                      Securities Purchased  . . . . . . . . . . . 10
              2.9   Appointment of Agents . . . . . . . . . . . . 10
              2.10  Deposit of Securities in Securities System  . 10
                    1)  Account of Custodian  . . . . . . . . . . 11
                    2)  Records . . . . . . . . . . . . . . . . . 11
                    3)  Payment of Fund Monies, Delivery of
                          Securities  . . . . . . . . . . . . . . 11
                    4)  Reports . . . . . . . . . . . . . . . . . 12
                    5)  Annual Certificate  . . . . . . . . . . . 12
                    6)  Indemnification . . . . . . . . . . . . . 12
              2.11  Fund Assets Held in the Custodian's Direct Paper
                      System  . . . . . . . . . . . . . . . . . . 13
              2.12  Segregated Account  . . . . . . . . . . . . . 14















          PAGE 3

              2.13  Ownership Certificates for Tax Purposes . . . 15
              2.14  Proxies . . . . . . . . . . . . . . . . . . . 15
              2.15  Communications Relating to Fund Portfolio
                      Securities  . . . . . . . . . . . . . . . . 15
              2.16  Reports to Fund by Independent Public
                      Accountants . . . . . . . . . . . . . . . . 16
          3.  Duties of the Custodian with Respect to Property 
                of the Fund Held Outside of the United States   . 16
              3.1   Appointment of Foreign Sub-Custodians . . . . 16
              3.2   Assets to be Held . . . . . . . . . . . . . . 17
              3.3   Foreign Securities Depositories . . . . . . . 17
              3.4   Segregation of Securities . . . . . . . . . . 17
              3.5   Access of Independent Accountants of the Fund 17
              3.6   Reports by Custodian  . . . . . . . . . . . . 18
              3.7   Transactions in Foreign Assets of the Fund  . 18
              3.8   Responsibility of Custodian, Sub-Custodian and
                      Fund  . . . . . . . . . . . . . . . . . . . 18
              3.9   Monitoring Responsibilities . . . . . . . . . 19
              3.10  Branches of U.S. Banks  . . . . . . . . . . . 19
          4.  Payments for Repurchases or Redemptions and Sales of
                Shares of the Fund  . . . . . . . . . . . . . . . 19
          5.  Proper Instructions   . . . . . . . . . . . . . . . 20
          6.  Actions Permitted Without Express Authority   . . . 21
          7.  Evidence of Authority, Reliance on Documents  . . . 21
          8.  Duties of Custodian with Respect to the Books of
                Account and Calculations of Net Asset Value and
                Net Income  . . . . . . . . . . . . . . . . . . . 22
          9.  Records, Inventory  . . . . . . . . . . . . . . . . 22
          10. Opinion of Fund's Independent Accountant  . . . . . 23
          11. Compensation of Custodian   . . . . . . . . . . . . 23
          12. Responsibility of Custodian   . . . . . . . . . . . 23
          13. Effective Period, Termination and Amendment   . . . 25
          14. Successor Custodian   . . . . . . . . . . . . . . . 26
          15. Interpretive and Additional Provisions  . . . . . . 28
          16. Notice  . . . . . . . . . . . . . . . . . . . . . . 28
          17. Bond  . . . . . . . . . . . . . . . . . . . . . . . 28
          18. Confidentiality   . . . . . . . . . . . . . . . . . 29
          19. Exemption from Liens  . . . . . . . . . . . . . . . 29
          20. Massachusetts Law to Apply  . . . . . . . . . . . . 29
          21. Prior Contracts   . . . . . . . . . . . . . . . . . 29
          22. The Parties   . . . . . . . . . . . . . . . . . . . 30
          23. Governing Documents   . . . . . . . . . . . . . . . 30
          24. Subcustodian Agreement  . . . . . . . . . . . . . . 30
          25. Directors and Trustees  . . . . . . . . . . . . . . 30
          26. Massachusetts Business Trust  . . . . . . . . . . . 30
          27. Successors of Parties   . . . . . . . . . . . . . . 31


















          PAGE 4
                                  CUSTODIAN CONTRACT

               This Contract by and between State Street Bank and Trust
          Company, a Massachusetts trust company, having its principal
          place of business at 225 Franklin Street, Boston, Massachusetts,
          02110 (hereinafter called the "Custodian"), and each fund which
          is listed on Appendix A (as such Appendix may be amended from
          time to time) and which evidences its agreement to be bound
          hereby by executing a copy of this Contract (each such fund
          individually hereinafter called the "Fund," whose definition may
          be found in Section 22), 

               WITNESSETH:  That in consideration of the mutual covenants
          and agreements hereinafter contained, the parties hereto agree as
          follows:
          1.   Employment of Custodian and Property to be Held by It
               The Fund hereby employs the Custodian as the custodian of
          its assets, including securities it desires to be held in places
          within the United States ("domestic securities") and securities
          it desires to be held outside the United States ("foreign
          securities") pursuant to the Governing Documents of the Fund. 
          The Fund agrees to deliver to the Custodian all securities and
          cash now or hereafter owned or acquired by it, and all payments
          of income, payments of principal or capital distributions
          received by it with respect to all securities owned by the Fund
          from time to time, and the cash consideration received by it for
          such new or treasury shares of capital stock ("Shares") of the
          Fund as may be issued or sold from time to time.  The Custodian
          shall not be responsible for any property of the Fund held or
          received by the Fund and not delivered to the Custodian.
               With respect to domestic securities, upon receipt of "Proper
          Instructions" (within the meaning of Article 5), the Custodian
          shall from time to time employ one or more sub-custodians located
          in the United States, but only in accordance with an applicable
          vote by the Board of Directors/Trustees of the Fund, and provided
          that the Custodian shall have no more or less responsibility or
          liability to the Fund on account of any actions or omissions of
          any sub-custodian so employed than any such sub-custodian has to
          the Custodian, and further provided that the Custodian shall not
          release the sub-custodian from any responsibility or liability
          unless mutually agreed upon by the parties in writing.  With
          respect to foreign securities and other assets of the Fund held
          outside the United States, the Custodian shall employ Chase
          Manhattan Bank, N.A., as a sub-custodian for the Fund in
          accordance with the provisions of Article 3.

          2.   Duties of the Custodian with Respect to Property of the Fund
               Held By the Custodian in the United States
               2.1  Holding Securities.  The Custodian shall hold and
               physically segregate for the account of the Fund all















          PAGE 5
               non-cash property, to be held by it in the United States,
               including all domestic securities owned by the Fund, other
               than (a) securities which are maintained pursuant to Section
               2.10 in a clearing agency which acts as a securities
               depository or in a book-entry system authorized by the U.S.
               Department of the Treasury, collectively referred to herein
               as "Securities System," and (b) commercial paper of an
               issuer for which the Custodian acts as issuing and paying
               agent ("Direct Paper") which is deposited and/or maintained
               in the Direct Paper System of the Custodian pursuant to
               Section 2.11.
               2.2  Delivery of Securities.  The Custodian shall release
               and deliver domestic securities owned by the Fund held by
               the Custodian or in a Securities System account of the
               Custodian or in the Custodian's Direct Paper book entry
               system account ("Direct Paper System Account") only upon
               receipt of Proper Instructions, which may be continuing
               instructions when deemed appropriate by mutual agreement of
               the parties, and only in the following cases:
                    1)   Sale.  Upon sale of such securities for the
                         account of the Fund and receipt of payment
                         therefor;
                    2)   Repurchase Agreement.  Upon the receipt of payment
                         in connection with any repurchase agreement
                         related to such securities entered into by the
                         Fund;
                    3)   Securities System.  In the case of a sale effected
                         through a Securities System, in accordance with
                         the provisions of Section 2.10 hereof;
                    4)   Tender Offer.  To the depository agent or other
                         receiving agent in connection with tender or other
                         similar offers for portfolio securities of the
                         Fund;
                    5)   Redemption by Issuer.  To the issuer thereof or
                         its agent when such securities are called,
                         redeemed, retired or otherwise become payable;
                         provided that, in any such case, the cash or other
                         consideration is to be delivered to the Custodian;
                    6)   Transfer to Issuer, Nominee. Exchange.  To the
                         issuer thereof, or its agent, for transfer into
                         the name of the Fund or into the name of any
                         nominee or nominees of the Custodian or into the
                         name or nominee name of any agent appointed
                         pursuant to Section 2.9 or into the name or
                         nominee name of any sub-custodian appointed
                         pursuant to Article 1; or for exchange for a
                         different number of bonds, certificates or other
                         evidence representing the same aggregate face
                         amount or number of units and bearing the same
                         interest rate, maturity date and call provisions,















          PAGE 6
                         if any; provided that, in any such case, the new
                         securities are to be delivered to the Custodian;
                    7)   Sale to Broker or Dealer.  Upon the sale of such
                         securities for the account of the Fund, to the
                         broker or its clearing agent or dealer, against a
                         receipt, for examination in accordance with
                         "street delivery" custom; provided that in any
                         such case, the Custodian shall have no
                         responsibility or liability for any loss arising
                         from the delivery of such securities prior to
                         receiving payment for such securities except as
                         may arise from the Custodian's failure to act in
                         accordance with its duties as set forth in
                         Section 12.
                    8)   Exchange or Conversion.  For exchange or
                         conversion pursuant to any plan of merger,
                         consolidation, recapitalization, reorganization,
                         split-up of shares, change of par value or
                         readjustment of the securities of the issuer of
                         such securities, or pursuant to provisions for
                         conversion contained in such securities, or
                         pursuant to any deposit agreement provided that,
                         in any such case, the new securities and cash, if
                         any, are to be delivered to the Custodian;
                    9)   Warrants, Rights.  In the case of warrants, rights
                         or similar securities, the surrender thereof in
                         the exercise of such warrants, rights or similar
                         securities or the surrender of interim receipts or
                         temporary securities for definitive securities;
                         provided that, in any such case, the new
                         securities and cash, if any, are to be delivered
                         to the Custodian;
                    10)  Loans of Securities.  For delivery in connection
                         with any loans of securities made by the Fund, but
                         only against receipt of adequate collateral as
                         agreed upon from time to time by the Custodian and
                         the Fund, which may be in the form of cash,
                         obligations issued by the United States
                         government, its agencies or instrumentalities, or
                         such other property as mutually agreed by the
                         parties, except that in connection with any loans
                         for which collateral is to be credited to the
                         Custodian's account in the book-entry system
                         authorized by the U.S. Department of the Treasury,
                         the Custodian will not be held liable or
                         responsible for the delivery of securities owned
                         by the Fund prior to the receipt of such
                         collateral, unless the Custodian fails to act in
                         accordance with its duties set forth in
                         Article 12;















          PAGE 7

                    11)  Borrowings.  For delivery as security in
                         connection with any borrowings by the Fund
                         requiring a pledge of assets by the Fund, but only
                         against receipt of amounts borrowed, except where
                         additional collateral is required to secure a
                         borrowing already made, subject to Proper
                         Instructions, further securities may be released
                         for that purpose;
                    12)  Options.  For delivery in accordance with the
                         provisions of any agreement among the Fund, the
                         Custodian and a broker-dealer registered under the
                         Securities Exchange Act of 1934 (the "Exchange
                         Act") and a member of The National Association of
                         Securities Dealers, Inc. ("NASD"), relating to
                         compliance with the rules of The Options Clearing
                         Corporation, any registered national securities
                         exchange, any similar organization or
                         organizations, or the Investment Company Act of
                         1940, regarding escrow or other arrangements in
                         connection with transactions by the Fund;
                    13)  Futures.  For delivery in accordance with the
                         provisions of any agreement among the Fund, the
                         Custodian, and a Futures Commission Merchant
                         registered under the Commodity Exchange Act,
                         relating to compliance with the rules of the
                         Commodity Futures Trading Commission and/or any
                         Contract Market, any similar organization or
                         organizations, or the Investment Company Act of
                         1940, regarding account deposits in connection
                         with transactions by the Fund;
                    14)  In-Kind Distributions.  Upon receipt of
                         instructions from the transfer agent ("Transfer
                         Agent") for the Fund, for delivery to such
                         Transfer Agent or to the holders of shares in
                         connection with distributions in kind, as may be
                         described from time to time in the Fund's
                         currently effective prospectus and statement of
                         additional information ("prospectus"), in
                         satisfaction of requests by holders of Shares for
                         repurchase or redemption;
                    15)  Miscellaneous.  For any other proper corporate
                         purpose, but only upon receipt of, in addition to
                         Proper Instructions, a certified copy of a
                         resolution of the Board of Directors/Trustees or
                         of the Executive Committee signed by an officer of
                         the Fund and certified by the Secretary or an
                         Assistant Secretary, specifying the securities to
                         be delivered, setting forth the purpose for which
                         such delivery is to be made, declaring such















          PAGE 8
                         purpose to be a proper corporate purpose, and
                         naming the person or persons to whom delivery of
                         such securities shall be made; and
                    16)  Type of Payment.  In any or all of the above
                         cases, payments to the Fund shall be made in cash,
                         by a certified check upon or a treasurer's or
                         cashier's check of a bank, by effective bank wire
                         transfer through the Federal Reserve Wire System
                         or, if appropriate, outside of the Federal Reserve
                         Wire System and subsequent credit to the Fund's
                         Custodian account, or, in case of delivery through
                         a stock clearing company, by book-entry credit by
                         the stock clearing company in accordance with the
                         then current street custom, or such other form of
                         payment as may be mutually agreed by the parties,
                         in all such cases collected funds to be promptly
                         credited to the Fund.
               2.3  Registration of Securities.  Domestic securities held
               by the Custodian (other than bearer securities) shall be
               registered in the name of the Fund or in the name of any
               nominee of the Fund or of any nominee of the Custodian which
               nominee shall be assigned exclusively to the Fund, unless
               the Fund has authorized in writing the appointment of a
               nominee to be used in common with other registered
               investment companies having the same investment adviser as
               the Fund, or in the name or nominee name of any agent
               appointed pursuant to Section 2.9 or in the name or nominee
               name of any sub-custodian appointed pursuant to Article 1. 
               All securities accepted by the Custodian on behalf of the
               Fund under the terms of this Contract shall be in "street
               name" or other good delivery form.
               2.4  Bank Accounts.  The Custodian shall open and maintain a
               separate bank account or accounts in the United States in
               the name of the Fund, subject only to draft or order by the
               Custodian acting pursuant to the terms of this Contract, and
               shall hold in such account or accounts, subject to the
               provisions hereof all cash received by it from or for the
               account of the Fund, other than cash maintained by the Fund
               in a bank account established and used in accordance with
               Rule 17f-3 under the Investment Company Act of 1940.  Funds
               held by the Custodian for the Fund may be deposited for the
               Fund's credit in the Banking Department of the Custodian or
               in such other banks or trust companies as the Custodian may
               in its discretion deem necessary or desirable; provided,
               however, that every such bank or trust company shall be
               qualified to act as a custodian under the Investment Company
               Act of 1940 and that each such bank or trust company and the
               funds to be deposited with each such bank or trust company
               shall be approved by vote of a majority of the Board of
               Directors/Trustees of the Fund.  Such funds shall be















          PAGE 9
               deposited by the Custodian in its capacity as Custodian and
               shall be withdrawable by the Custodian only in that
               capacity.
               2.5  Sale of Shares and Availability of Federal Funds.  Upon
               mutual agreement between the Fund and the Custodian, the
               Custodian shall, upon the receipt of Proper Instructions,
               make federal funds available to the Fund as of specified
               times agreed upon from time to time by the Fund and the
               Custodian in the amount of checks received in payment for
               Shares of the Fund which are deposited into the Fund's
               account.
               2.6  Collection of Income, Dividends.  The Custodian shall
               collect on a timely basis all income and other payments with
               respect to United States registered securities held
               hereunder to which the Fund shall be entitled either by law
               or pursuant to custom in the securities business, and shall
               collect on a timely basis all income and other payments with
               respect to United States bearer securities if, on the date
               of payment by the issuer, such securities are held by the
               Custodian or its agent thereof and shall credit such income
               or other payments, as collected, to the Fund's custodian
               account.  Without limiting the generality of the foregoing,
               the Custodian shall detach and present for payment all
               coupons and other income items requiring presentation as and
               when they become due and shall collect interest when due on
               securities held hereunder.  The Custodian will also receive
               and collect all stock dividends, rights and other items of
               like nature as and when they become due or payable.  Income
               due the Fund on United States securities loaned pursuant to
               the provisions of Section 2.2 (10) shall be the
               responsibility of the Fund.  The Custodian will have no duty
               or responsibility in connection therewith, other than to
               provide the Fund with such information or data as may be
               necessary to assist the Fund in arranging for the timely
               delivery to the Custodian of the income to which the Fund is
               properly entitled.
               2.7  Payment of Fund Monies.  Upon receipt of Proper
               Instructions,
               which may be continuing instructions when deemed appropriate
               by mutual agreement of the parties, the Custodian shall pay
               out monies of the Fund in the following cases only:
                    1)   Purchases.  Upon the purchase of domestic
                         securities, options, futures contracts or options
                         on futures contracts for the account of the Fund
                         but only (a) against the delivery of such
                         securities, or evidence of title to such options,
                         futures contracts or options on futures contracts,
                         to the Custodian (or any bank, banking firm or
                         trust company doing business in the United States
                         or abroad which is qualified under the Investment















          PAGE 10
                         Company Act of 1940, as amended, to act as a
                         custodian and has been designated by the Custodian
                         as its agent for this purpose in accordance with
                         Section 2.9 hereof) registered in the name of the
                         Fund or in the name of a nominee of the Fund or of
                         the Custodian referred to in Section 2.3 hereof or
                         in other proper form for transfer; (b) in the case
                         of a purchase effected through a Securities
                         System, in accordance with the conditions set
                         forth in Section 2.10 hereof or (c) in the case of
                         a purchase involving the Direct Paper System, in
                         accordance with the conditions set forth in
                         Section 2.11; or (d) in the case of repurchase
                         agreements entered into between the Fund and the
                         Custodian, or another bank, or a broker-dealer
                         which is a member of NASD, (i) against delivery of
                         the securities either in certificate form or
                         through an entry crediting the Custodian's account
                         at the Federal Reserve Bank with such securities
                         or (ii) against delivery of the receipt evidencing
                         purchase by the Fund of securities owned by the
                         Custodian along with written evidence of the
                         agreement by the Custodian to repurchase such
                         securities from the Fund.  All coupon bonds
                         accepted by the Custodian shall have the coupons
                         attached or shall be accompanied by a check
                         payable on coupon payable date for the interest
                         due on such date.
                    2)   Exchanges.  In connection with conversion,
                         exchange or surrender of securities owned by the
                         Fund as set forth in Section 2.2 hereof;
                    3)   Redemptions.  For the redemption or repurchase of
                         Shares issued by the Fund as set forth in Article
                         4 hereof;
                    4)   Expense and Liability.  For the payment of any
                         expense or liability incurred by the Fund,
                         including but not limited to the following
                         payments for the account of the Fund:  interest,
                         taxes, management, accounting, transfer agent and
                         legal fees, and operating expenses of the Fund
                         whether or not such expenses are to be in whole or
                         part capitalized or treated as deferred expenses;
                    5)   Dividends.  For the payment of any dividends or
                         other distributions to shareholders declared
                         pursuant to the Governing Documents of the Fund;
                    6)   Short Sale Dividend.  For payment of the amount of
                         dividends received in respect of securities sold
                         short;
                    7)   Loan.  For repayment of a loan upon redelivery of
                         pledged securities and upon surrender of the















          PAGE 11
                         note(s), if any, evidencing the loan;
                    8)   Miscellaneous.  For any other proper purpose, but
                         only upon receipt of, in addition to Proper
                         Instructions, a certified copy of a resolution of
                         the Board of Directors/Trustees or of the
                         Executive Committee of the Fund signed by an
                         officer of the Fund and certified by its Secretary
                         or an Assistant Secretary, specifying the amount
                         of such payment, setting forth the purpose for
                         which such payment is to be made, declaring such
                         purpose to be a proper purpose, and naming the
                         person or persons to whom such payment is to be
                         made.
               2.8  Liability for Payment in Advance of Receipt of
               Securities Purchased.  In any and every case where payment
               for purchase of domestic securities for the account of the
               Fund is made by the Custodian in advance of receipt of the
               securities purchased in the absence of specific written
               instructions from the Fund to so pay in advance, the
               Custodian shall be absolutely liable to the Fund for such
               securities to the same extent as if the securities had been
               received by the Custodian.
               2.9  Appointment of Agents.  The Custodian may at any time
               or times in its discretion appoint (and may at any time
               remove) any other bank or trust company, which is itself
               qualified under the Investment Company Act of 1940, as
               amended, to act as a custodian, as its agent to carry out
               such of the provisions of this Article 2 as the Custodian
               may from time to time direct; provided, however, that the
               appointment of any agent shall not relieve the Custodian of
               its responsibilities or liabilities hereunder.
               2.10 Deposit of Securities in Securities Systems.  The
               Custodian may deposit and/or maintain domestic securities
               owned by the Fund in a clearing agency registered with the
               Securities and Exchange Commission under Section 17A of the
               Securities Exchange Act of 1934, which acts as a securities
               depository, or in the book-entry system authorized by the
               U.S. Department of the Treasury and certain federal
               agencies, collectively referred to herein as "Securities
               System" in accordance with applicable Federal Reserve Board
               and Securities and Exchange Commission rules and
               regulations, if any, and subject to the following
               provisions:
                    1)   Account of Custodian.  The Custodian may keep
                         domestic securities of the Fund in a Securities
                         System provided that such securities are
                         represented in an account ("Account") of the
                         Custodian in the Securities System which shall not
                         include any assets of the Custodian other than
                         assets held as a fiduciary, custodian or otherwise















          PAGE 12
                         for customers;
                    2)   Records.  The records of the Custodian, with
                         respect to domestic securities of the Fund which
                         are maintained in a Securities System, shall
                         identify by book-entry those securities belonging
                         to the Fund;
                    3)   Payment of Fund Monies, Delivery of Securities. 
                         Subject to Section 2.7, the Custodian shall pay
                         for domestic securities purchased for the account
                         of the Fund upon (i) receipt of advice from the
                         Securities System that such securities have been
                         transferred to the Account, and (ii) the making of
                         an entry on the records of the Custodian to
                         reflect such payment and transfer for the account
                         of the Fund.  Subject to Section 2.2, the
                         Custodian shall transfer domestic securities sold
                         for the account of the Fund upon (i) receipt of
                         advice from the Securities System that payment for
                         such securities has been transferred to the
                         Account, and (ii) the making of an entry on the
                         records of the Custodian to reflect such transfer
                         and payment for the account of the Fund.  Copies
                         of all advices from the Securities System of
                         transfers of domestic securities for the account
                         of the Fund shall identify the Fund, be maintained
                         for the Fund by the Custodian and be provided to
                         the Fund at its request.  The Custodian shall
                         furnish the Fund confirmation of each transfer to
                         or from the account of the Fund in the form of a
                         written advice or notice and shall furnish to the
                         Fund copies of daily transaction sheets reflecting
                         each day's transactions in the Securities System
                         for the account of the Fund;
                    4)   Reports.  The Custodian shall provide the Fund
                         with any report obtained by the Custodian on the
                         Securities System's accounting system, internal
                         accounting control and procedures for safeguarding
                         domestic securities deposited in the Securities
                         System, and further agrees to provide the Fund
                         with copies of any documentation it has relating
                         to its arrangements with the Securities Systems as
                         set forth in this Agreement or as otherwise
                         required by the Securities and Exchange
                         Commission;
                    5)   Annual Certificate.  The Custodian shall have
                         received the initial or annual certificate, as the
                         case may be, required by Article 13 hereof;
                    6)   Indemnification.  Anything to the contrary in this
                         Contract notwithstanding, the Custodian shall be
                         liable to the Fund for any loss or expense,















          PAGE 13
                         including reasonable attorneys fees, or damage to
                         the Fund resulting from use of the Securities
                         System by reason of any failure by the Custodian
                         or any of its agents or of any of its or their
                         employees or agents or from failure of the
                         Custodian or any such agent to enforce effectively
                         such rights as it may have against the Securities
                         System; at the election of the Fund, it shall be
                         entitled to be subrogated to the rights of the
                         Custodian with respect to any claim against the
                         Securities System or any other person which the
                         Custodian may have as a consequence of any such
                         loss, expense or damage if and to the extent that
                         the Fund has not been made whole for any such
                         loss, expense or damage.
               2.11 Fund Assets Held in the Custodian's Direct Paper
               System.  The Custodian may deposit and/or maintain
               securities owned by the Fund in the Direct Paper System of
               the Custodian subject to the following provisions:
                    1)   No transaction relating to securities in the
                         Direct Paper System will be effected in the
                         absence of Proper Instructions;
                    2)   The Custodian may keep securities of the Fund in
                         the Direct Paper System only if such securities
                         are represented in an account ("Account") of the
                         Custodian in the Direct Paper System which shall
                         not include any assets of the Custodian other than
                         assets held as a fiduciary, custodian or otherwise
                         for customers;
                    3)   The records of the Custodian with respect to
                         securities of the Fund which are maintained in the
                         Direct Paper System shall identify by book-entry
                         those securities belonging to the Fund;
                    4)   The Custodian shall pay for securities purchased
                         for the account of the Fund upon the making of an
                         entry on the records of the Custodian to reflect
                         such payment and transfer of securities to the
                         account of the Fund.  The Custodian shall transfer
                         securities sold for the account of the Fund upon
                         the making of an entry on the records of the
                         Custodian to reflect such transfer and receipt of
                         payment for the account of the Fund;
                    5)   The Custodian shall furnish the Fund confirmation
                         of each transfer to or from the account of the
                         Fund, in the form of a written advice or notice,
                         of Direct Paper on the next business day following
                         such transfer and shall furnish to the Fund copies
                         of daily transaction sheets reflecting each day's
                         transaction in the Securities System for the
                         account of the Fund;















          PAGE 14

                    6)   The Custodian shall provide the Fund with any
                         report on its system of internal accounting
                         control as the Fund may reasonably request from
                         time to time;
               2.12 Segregated Account.  The Custodian shall, upon receipt
               of Proper Instructions, which may be of a continuing nature
               where deemed appropriate by mutual agreement of the parties,
               establish and maintain a segregated account or accounts for
               and on behalf of the Fund, into which account or accounts
               may be transferred cash and/or securities, including
               securities maintained in an account by the Custodian
               pursuant to Section 2.10 hereof, (i) in accordance with the
               provisions of any agreement among the Fund, the Custodian
               and a broker-dealer registered under the Exchange Act and a
               member of the NASD (or any futures commission merchant
               registered under the Commodity Exchange Act), relating to
               compliance with the rules of The Options Clearing
               Corporation and of any registered national securities
               exchange (or the Commodity Futures Trading Commission or any
               registered contract market), or of any similar organization
               or organizations, regarding escrow or other arrangements in
               connection with transactions by the Fund, (ii) for purposes
               of segregating cash or government securities in connection
               with options purchased, sold or written by the Fund or
               commodity futures contracts or options thereon purchased or
               sold by the Fund, (iii) for the purposes of compliance by
               the Fund with the procedures required by Investment Company
               Act Release No. 10666, or any subsequent release, rule or
               policy, of the Securities and Exchange Commission relating
               to the maintenance of segregated accounts by registered
               investment companies and (iv) for other proper corporate
               purposes, but only, in the case of clause (iv), upon receipt
               of, in addition to Proper Instructions, a certified copy of
               a resolution of the Board of Directors/Trustees or of the
               Executive Committee signed by an officer of the Fund and
               certified by the Secretary or an Assistant Secretary,
               setting forth the purpose or purposes of such segregated
               account and declaring such purposes to be proper corporate
               purposes.
               2.13 Ownership Certificates for Tax Purposes.  The Custodian
               shall execute ownership and other certificates and
               affidavits for all federal and state tax purposes in
               connection with receipt of income or other payments with
               respect to domestic securities of the Fund held by it and in
               connection with transfers of such securities.
               2.14 Proxies.  If the securities are registered other than
               in the name of the Fund or a nominee of the Fund, the
               Custodian shall, with respect to the domestic securities
               held hereunder, cause to be promptly executed by the















          PAGE 15
               registered holder of such securities, all proxies, without
               indication of the manner in which such proxies are to be
               voted, and shall promptly deliver to the Fund such proxies,
               all proxy soliciting materials and all notices relating to
               such securities.
               2.15 Communications Relating to Fund Portfolio Securities. 
               The Custodian shall transmit promptly to the Fund all
               written information (including, without limitation, pendency
               of calls and maturities of domestic securities and
               expirations of rights in connection therewith and notices of
               exercise of call and put options written by the Fund and the
               maturity of futures contracts purchased or sold by the Fund)
               received by the Custodian from issuers of the domestic
               securities being held for the Fund by the Custodian, an
               agent appointed under Section 2.9, or sub-custodian
               appointed under Section 1.  With respect to tender or
               exchange offers, the Custodian shall transmit promptly to
               the Fund all written information received by the Custodian,
               an agent appointed under Section 2.9, or sub-custodian
               appointed under Section 1 from issuers of the domestic
               securities whose tender or exchange is sought and from the
               party (or his agents) making the tender or exchange offer. 
               If the Fund desires to take action with respect to any
               tender offer, exchange offer or any other similar
               transaction, the Fund shall notify the Custodian of such
               desired action at least 72 hours (excluding holidays and
               weekends) prior to the time such action must be taken under
               the terms of the tender, exchange offer, or other similar
               transaction, and it will be the responsibility of the
               Custodian to timely transmit to the appropriate person(s)
               the Fund's notice.  Where the Fund does not notify the
               Custodian of its desired action within the aforesaid 72 hour
               period, the Custodian shall use its best efforts to timely
               transmit the Fund's notice to the appropriate person. 
               2.16 Reports to Fund by Independent Public Accountants.  The
               Custodian shall provide the Fund, at such times as the Fund
               may reasonably require, with reports by independent public
               accountants on the accounting system, internal accounting
               control and procedures for safeguarding securities, futures
               contracts and options on futures contracts, including
               domestic securities deposited and/or maintained in a
               Securities System, relating to the services provided by the
               Custodian under this Contract; such reports shall be of
               sufficient scope and in sufficient detail, as may reasonably
               be required by the Fund to provide reasonable assurance that
               any material inadequacies existing or arising since the
               prior examination would be disclosed by such examination. 
               The reports must describe any material inadequacies
               disclosed and, if there are no such inadequacies, the
               reports shall so state.















          PAGE 16

          3.   Duties of the Custodian with Respect to Property of the Fund
               Held Outside of the United States
               3.1  Appointment of Foreign Sub-Custodians.  The Custodian
               is authorized and instructed to employ Chase Manhattan Bank,
               N.A, ("Chase") as sub-custodian for the Fund's securities,
               cash and other assets maintained outside of the United
               States ("foreign assets") all as described in the
               Subcustodian Agreement between the Custodian and Chase. 
               Upon receipt of "Proper Instructions", together with a
               certified resolution of the Fund's Board of
               Directors/Trustees, the Custodian and the Fund may agree to
               designate additional proper institutions and foreign
               securities depositories to act as sub-custodians of the
               Fund's foreign assets.  Upon receipt of Proper Instructions
               from the Fund, the Custodian shall cease the employment of
               any one or more of such sub-custodians for maintaining
               custody of the Fund's foreign assets.
               3.2  Assets to be Held.  The Custodian shall limit the
               foreign assets maintained in the custody of foreign sub-
               custodians to foreign assets specified under the terms of
               the Subcustodian Agreement between the Custodian and Chase.
               3.3  Foreign Securities Depositories.  Except as may
               otherwise be agreed upon in writing by the Custodian and the
               Fund, foreign assets of the Fund shall be maintained in
               foreign securities depositories only through arrangements
               implemented by the banking institutions serving as sub-
               custodians pursuant to the terms hereof.
               3.4  Segregation of Securities.  The Custodian shall
               identify on its books as belonging to the Fund, the foreign
               assets of the Fund held by Chase and by each foreign sub-
               custodian.
               3.5  Access of Independent Accountants of the Fund.  Upon
               request of the Fund, the Custodian will use its best efforts
               (subject to applicable law) to arrange for the independent
               accountants, officers or other representatives of the Fund
               or the Custodian to be afforded access to the books and
               records of Chase and any banking or other institution
               employed as a sub-custodian for the Fund by Chase or the
               Custodian insofar as such books and records relate to the
               performance of Chase or such banking or other institution
               under any agreement with the Custodian or Chase.  Upon
               request of the Fund, the Custodian shall furnish to the Fund
               such reports (or portions thereof) of Chase's external
               auditors as are available to the Custodian and which relate
               directly to Chase's system of internal accounting controls
               applicable to Chase's duties as a subcustodian or which
               relate to the internal accounting controls of any
               subcustodian employed by Chase with respect to foreign
               assets of the Fund.















          PAGE 17

               3.6  Reports by Custodian.  The Custodian will supply to the
               Fund from time to time, as mutually agreed upon, statements
               in respect of the foreign assets of the Fund held pursuant
               to the terms of the Subcustodian Agreement between the
               Custodian and Chase, including but not limited, to an
               identification of entities having possession of the Fund's
               foreign assets and advices or notifications of any transfers
               of foreign assets to or from each custodial account
               maintained by any sub-custodian on behalf of the Fund
               indicating, as to foreign assets acquired for the Fund, the
               identity of the entity having physical possession of such
               foreign assets.
               3.7  Transactions in Foreign Assets of the Fund.  All
               transactions with respect to the Fund's foreign assets shall
               be in accordance with, and subject to, the provisions of the
               Subcustodian Agreement between Chase and the Custodian.
               3.8  Responsibility of Custodian, Sub-Custodian, and Fund. 
               Notwithstanding anything to the contrary in this Custodian
               Contract, the Custodian shall not be liable to the Fund for
               any loss, damage, cost, expense, liability or claim arising
               out of or in connection with the maintenance of custody of
               the Fund's foreign assets by Chase or by any other banking
               institution or securities depository employed pursuant to
               the terms of any Subcustodian Agreement between Chase and
               the Custodian, except that the Custodian shall be liable for
               any such loss, damage, cost, expense, liability or claim to
               the extent provided in the Subcustodian Agreement between
               Chase and the Custodian or attributable to the failure of
               the Custodian to exercise the standard of care set forth in
               Article 12 hereof in the performance of its duties under
               this Contract or such Subcustodian Agreement.  At the
               election of the Fund, the Fund shall be entitled to be
               subrogated to the rights of the Custodian under the
               Subcustodian Agreement with respect to any claims arising
               thereunder against Chase or any other banking institution or
               securities depository employed by Chase if and to the extent
               that the Fund has not been made whole therefor.  As between
               the Fund and the Custodian, the Fund shall be solely
               responsible to assure that the maintenance of foreign
               securities and cash pursuant to the terms of the
               Subcustodian Agreement complies with all applicable rules,
               regulations, interpretations and orders of the Securities
               and Exchange Commission, and the Custodian assumes no
               responsibility and makes no representations as to such
               compliance.
               3.9  Monitoring Responsibilities.  With respect to the
               Fund's foreign assets, the Custodian shall furnish annually
               to the Fund, during the month of June, information
               concerning the sub-custodians employed by the Custodian. 















          PAGE 18
               Such information shall be similar in kind and scope to that
               furnished to the Fund in connection with the initial
               approval of this Contract.  In addition, the Custodian will
               promptly inform the Fund in the event that the Custodian
               learns of a material adverse change in the financial
               condition of a sub-custodian.
               3.10 Branches of U.S. Banks.  Except as otherwise set forth
               in this Contract, the provisions of this Article 3 shall not
               apply where the custody of the Fund's assets is maintained
               in a foreign branch of a banking institution which is a
               "bank" as defined by Section 2(a)(5) of the Investment
               Company Act of 1940 which meets the qualification set forth
               in Section 26(a) of said Act.  The appointment of any such
               branch as a sub-custodian shall be governed by Section 1 of
               this Contract.
          4.   Payments for Repurchases or Redemptions and Sales of Shares
               of the Fund
               From such funds as may be available for the purpose but
          subject to the limitations of the Governing Documents of the Fund
          and any applicable votes of the Board of Directors/Trustees of
          the Fund pursuant thereto, the Custodian shall, upon receipt of
          instructions from the Transfer Agent, make funds available for
          payment to holders of Shares who have delivered to the Transfer
          Agent a request for redemption or repurchase of their Shares.  In
          connection with the redemption or repurchase of Shares of the
          Fund, the Custodian is authorized upon receipt of instructions
          from the Transfer Agent to wire funds to or through a commercial
          bank designated by the redeeming shareholder.  In connection with
          the redemption or repurchase of Shares of the Fund, the Custodian
          shall honor checks drawn on the Custodian by a holder of Shares,
          which checks have been furnished by the Fund to the holder of
          Shares, when presented to the Custodian in accordance with such
          procedures and controls as are mutually agreed upon from time to
          time between the Fund and the Custodian.

               The Custodian shall receive from the distributor for the
          Fund's Shares or from the Transfer Agent of the Fund and deposit
          as received into the Fund's account such payments as are received
          for Shares of the Fund issued or sold from time to time by the
          Fund.  The Custodian will provide timely notification to the Fund
          and the Transfer Agent of any receipt by it of payments for
          Shares of the Fund.
          5.   Proper Instructions
               Proper Instructions as used herein means a writing signed or
          initialled by one or more person or persons as the Board of
          Directors/Trustees shall have from time to time authorized.  Each
          such writing shall set forth the specific transaction or type of
          transaction involved, including a specific statement of the
          purpose for which such action is requested, or shall be a blanket
          instruction authorizing specific transactions of a repeated or















          PAGE 19
          routine nature.  Oral instructions will be considered Proper
          Instructions if the Custodian reasonably believes them to have
          been given by a person authorized to give such instructions with
          respect to the transaction involved.  The Fund shall cause all
          oral instructions to be confirmed in writing.  Upon receipt of a
          certificate of the Secretary or an Assistant Secretary as to the
          authorization by the Board of Directors/Trustees of the Fund
          accompanied by a detailed description of procedures approved by
          the Board of Directors/Trustees, Proper Instructions may include
          communications effected directly between electro-mechanical or
          electronic devices provided that the Board of Directors/Trustees
          and the Custodian are satisfied that such procedures afford
          adequate safeguards for the Fund's assets.  
          6.  Actions Permitted without Express Authority
               The Custodian may in its discretion, without express
          authority from the Fund:
                    1)   make payments to itself or others for minor
                         expenses of handling securities or other similar
                         items relating to its duties under this Contract,
                         provided that all such payments shall be accounted
                         for to the Fund;
                    2)   surrender securities in temporary form for
                         securities in definitive form;
                    3)   endorse for collection, in the name of the Fund,
                         checks, drafts and other negotiable instruments on
                         the same day as received; and
                    4)   in general, attend to all non-discretionary
                         details in connection with the sale, exchange,
                         substitution, purchase, transfer and other
                         dealings with the securities and property of the
                         Fund except as otherwise directed by the Board of
                         Directors/Trustees of the Fund.
          7.   Evidence of Authority, Reliance on Documents
               The Custodian shall be protected in acting upon any
          instructions, notice, request, consent, certificate or other
          instrument or paper reasonably and in good faith believed by it
          to be genuine and to have been properly executed by or on behalf
          of the Fund in accordance with Article 5 hereof.  The Custodian
          may receive and accept a certified copy of a vote of the Board of
          Directors/Trustees of the Fund as conclusive evidence (a) of the
          authority of any person to act in accordance with such vote or
          (b) of any determination or of any action by the Board of
          Directors/Trustees pursuant to the Governing Documents of the
          Fund as described in such vote, and such vote may be considered
          as in full force and effect until receipt by the Custodian of
          written notice to the contrary.  So long as and to the extent
          that it is in the exercise of the standard of care set forth in
          Article 12 hereof, the Custodian shall not be responsible for the
          title, validity or genuineness of any property or evidence of
          title thereto received by it or delivered by it pursuant to this















          PAGE 20
          Contract and shall be held harmless in acting upon any notice,
          request, consent, certificate or other instrument reasonably
          believed by it to be genuine and to be signed by the proper party
          or parties.  
          8.   Duties of Custodian with Respect to the Books of Account and
               Calculation of Net Asset Value and Net Income
               The Custodian shall cooperate with and supply necessary
          information to the person or persons appointed by the Board of
          Directors/Trustees of the Fund to keep the books of account of
          the Fund and/or compute the net asset value per share of the
          outstanding shares of the Fund or, if directed in writing to do
          so by the Fund, shall itself keep such books of account and/or
          compute such net asset value per share.  If so directed, the
          Custodian shall also calculate daily the net income of the Fund
          as described in the Fund's currently effective prospectus and
          shall advise the Fund and the Transfer Agent daily of the total
          amounts of such net income and, if instructed in writing by an
          officer of the Fund to do so, shall advise the Transfer Agent
          periodically of the division of such net income among its various
          components.  The calculations of the net asset value per share
          and the daily income of the Fund shall be made at the time or
          times and in the manner described from time to time in the Fund's
          currently effective prospectus.  
          9.   Records, Inventory
               The Custodian shall create and maintain all records relating
          to its activities and obligations under this Contract in such
          manner as will meet the obligations of the Fund under the
          Investment Company Act of 1940, with particular attention to
          Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
          applicable federal and state tax laws and any other law or
          administrative rules or procedures which may be applicable to the
          Fund.  All such records shall be the property of the Fund and
          shall at all times during the regular business hours of the
          Custodian be open for inspection and audit by duly authorized
          officers, employees or agents of the Fund and employees and
          agents of the Securities and Exchange Commission, and, in the
          event of termination of this Agreement, will be delivered in
          accordance with Section 14 hereof.  The Custodian shall, at the
          Fund's request, supply the Fund with a tabulation of securities
          owned by the Fund and held by the Custodian and shall, when
          requested to do so by the Fund and for such compensation as shall
          be agreed upon between the Fund and the Custodian, include
          certificate numbers in such tabulations.  The Custodian shall
          conduct a periodic inventory of all securities and other property
          subject to this Agreement and provide to the Fund a periodic
          reconciliation of the vaulted position of the Fund to the
          appraised position of the Fund.  The Custodian will promptly
          report to the Fund the results of the reconciliation, indicating
          any shortages or discrepancies uncovered thereby, and take
          appropriate action to remedy any such shortages or discrepancies.















          PAGE 21

          10.  Opinion of Fund's Independent Accountant
               The Custodian shall cooperate with the Fund's independent
          public accountants in connection with the annual and other audits
          of the books and records of the Fund and take all reasonable
          action, as the Fund may from time to time request, to provide
          from year to year the necessary information to such accountants
          for the expression of their opinion without any qualification as
          to the scope of their examination, including but not limited to,
          any opinion in connection with the preparation of the Fund's Form
          N-lA, and Form N-SAR or other annual reports to the Securities
          and Exchange Commission and with respect to any other
          requirements of such Commission.  
          11.  Compensation of Custodian
               The Custodian shall be entitled to reasonable compensation
          for its services and expenses as Custodian, as agreed upon from
          time to time between the Fund and the Custodian.  
          12.  Responsibility of Custodian
               Notwithstanding anything to the contrary in this Agreement,
          the Custodian shall be held to the exercise of reasonable care in
          carrying out the provisions of this Contract, but shall be kept
          indemnified by and shall be without liability to the Fund for any
          action taken or omitted by it in good faith without negligence. 
          In order for the indemnification provision contained in this
          Section to apply, it is understood that if in any case the Fund
          may be asked to indemnify or save the Custodian harmless, the
          Fund shall be fully and promptly advised of all pertinent facts
          concerning the situation in question, and it is further
          understood that the Custodian will use all reasonable care to
          identify and notify the Fund promptly concerning any situation
          which presents or appears likely to present the probability of
          such a claim for indemnification against the Fund.  The Fund,
          shall have the option to defend the Custodian against any claim
          which may be the subject of this indemnification, and in the
          event that the Fund so elects, it will so notify the Custodian,
          and thereupon the Fund shall take over complete defense of the
          claim and the Custodian shall in such situation initiate no
          further legal or other expenses for which it shall seek
          indemnification under this Section.  The Custodian shall in no
          case confess any claim or make any compromise in any case in
          which the Fund will be asked to indemnify the Custodian except
          with the Fund's prior written consent.  Nothing herein shall be
          construed to limit any right or cause of action on the part of
          the Custodian under this Contract which is independent of any
          right or cause of action on the part of the Fund.  The Custodian
          shall be entitled to rely on and may act upon advice of counsel
          (who may be counsel for the Fund or such other counsel as may be
          agreed to by the parties) on all matters, and shall be without
          liability for any action reasonably taken or omitted pursuant to
          such advice.  Notwithstanding the foregoing, the responsibility















          PAGE 22
          of the Custodian with respect to redemptions effected by check
          shall be in accordance with a separate Agreement entered into
          between the Custodian and the Fund.
               If the Fund requires the Custodian to take any action with
          respect to securities, which action involves the payment of money
          or which action may, in the opinion of the Custodian, result in
          the Custodian or its nominee assigned to the Fund being liable
          for the payment of money or incurring liability of some other
          form, the Fund, as a prerequisite to requiring the Custodian to
          take such action, shall provide indemnity to the Custodian in an
          amount and form satisfactory to it.
               If the Fund requires the Custodian to advance cash or
          securities for any purpose or in the event that the Custodian or
          its nominee shall incur or be assessed any taxes, charges,
          expenses, assessments, claims or liabilities in connection with
          the performance of this Contract, except such as may arise from
          its or its nominee's own negligent action, negligent failure to
          act or willful misconduct, any property at any time held for the
          account of the Fund shall be security therefor and should the
          Fund fail to repay the Custodian promptly, the Custodian shall be
          entitled to utilize available cash and to dispose of the Fund's
          assets to the extent necessary to obtain reimbursement, provided
          that the Custodian gives the Fund reasonable notice to repay such
          cash or securities advanced, however, such notice shall not
          preclude the Custodian's right to assert any lien under this
          provision.
          13.  Effective Period, Termination and Amendment
               This Contract shall become effective as of its execution,
          shall continue in full force and effect until terminated as
          hereinafter provided, may be amended at any time by mutual
          agreement of the parties hereto and may be terminated by either
          party by an instrument in writing delivered or mailed, postage
          prepaid to the other party, such termination to take effect not
          sooner than sixty (60) days after the date of such delivery or
          mailing in the case of a termination by the Fund, and not sooner
          than 180 days after the date of such delivery or mailing in the
          case of a termination by the Custodian; provided, however that
          the Custodian shall not act under Section 2.10 hereof in the
          absence of receipt of an initial certificate of the Secretary or
          an Assistant Secretary that the Board of Directors/Trustees of
          the Fund has approved the initial use of a particular Securities
          System and the receipt of an annual certificate of the Secretary
          or an Assistant Secretary that the Board of Directors/Trustees
          has reviewed the use by the Fund of such Securities System, as
          required in each case by Rule 17f-4 under the Investment Company
          Act of 1940, as amended and that the Custodian shall not act
          under Section 2.11 hereof in the absence of receipt of an initial
          certificate of the Secretary or an Assistant Secretary that the
          Board of Directors/Trustees has approved the initial use of the
          Direct Paper System and the receipt of an annual certificate of















          PAGE 23
          the Secretary or an Assistant Secretary that the Board of
          Directors/Trustees has reviewed the use by the Fund of the Direct
          Paper System; provided further, however, that the Fund shall not
          amend or terminate this Contract in contravention of any
          applicable federal or state regulations, or any provision of the
          Governing Documents of the Fund, and further provided, that the
          Fund may at any time by action of its Board of Directors/Trustees
          (i) substitute another bank or trust company for the Custodian by
          giving notice as described above to the Custodian, or (ii)
          immediately terminate this Contract in the event of the
          appointment of a conservator or receiver for the Custodian by the
          Comptroller of the Currency or upon the happening of a like event
          at the direction of an appropriate regulatory agency or court of
          competent jurisdiction.
               Upon termination of the Contract, the Fund shall pay to the
          Custodian such compensation as may be due as of the date of such
          termination and shall likewise reimburse the Custodian for its
          costs, expenses and disbursements, provided that the Custodian
          shall not incur any costs, expenses or disbursements specifically
          in connection with such termination unless it has received prior
          approval from the Fund, which approval shall not be unreasonably
          withheld.
          14.  Successor Custodian
               If a successor custodian shall be appointed by the Board of
          Directors/Trustees of the Fund, the Custodian shall, upon
          termination, deliver to such successor custodian at the office of
          the Custodian, duly endorsed and in the form for transfer, all
          securities, funds and other properties then held by it hereunder
          and shall transfer to an account of the successor custodian all
          of the Fund's securities held in a Securities System.  The
          Custodian shall also use its best efforts to assure that the
          successor custodian will continue any subcustodian agreement
          entered into by the Custodian and any subcustodian on behalf of
          the Fund.

               If no such successor custodian shall be appointed, the
          Custodian shall, in like manner, upon receipt of a certified copy
          of a vote of the Board of Directors/Trustees of the Fund, deliver
          at the office of the Custodian and transfer such securities,
          funds and other properties in accordance with such vote.

               In the event that no written order designating a successor
          custodian or certified copy of a vote of the Board of
          Directors/Trustees shall have been delivered to the Custodian on
          or before the date when such termination shall become effective,
          then the Custodian shall have the right to deliver to a bank
          or trust company, which is a "bank" as defined in the Investment
          Company Act of 1940, doing business in Boston, Massachusetts, of
          its own selection, having an aggregate capital, surplus, and
          undivided profits, as shown by its last published report, of not















          PAGE 24
          less than $25,000,000, all securities, funds and other properties
          held by the Custodian and all instruments held by the Custodian
          relative thereto and all other property held by it under this
          Contract and to transfer to an account of such successor
          custodian all of the Fund's securities held in any Securities
          System.  Thereafter, such bank or trust company shall be the
          successor of the Custodian under this Contract.

               In the event that securities, funds and other properties
          remain in the possession of the Custodian after the date of
          termination hereof owing to failure of the Fund to procure the
          certified copy of the vote referred to or of the Board of
          Directors/Trustees to appoint a successor custodian, the
          Custodian shall be entitled to fair compensation for its services
          during such period as the Custodian retains possession of such
          securities, funds and other properties and the provisions of this
          Contract relating to the duties and obligations of the Custodian
          shall remain in full force and effect.  If while this Contract is
          in force the Fund shall be liquidated pursuant to law, the
          Custodian shall distribute, either in cash or (if the Fund so
          orders) in the portfolio securities and other assets of the Fund,
          pro rata among the holders of shares of the Fund as certified by
          the Transfer Agent, the property of the Fund which remains after
          paying or satisfying all expenses and liabilities of the Fund. 
          Section 12 hereof shall survive any termination of this Contract.
          15.  Interpretive and Additional Provisions
               In connection with the operation of this Contract, the
          Custodian and the Fund may from time to time agree on such
          provisions interpretive of or in addition to the provisions of
          this Contract as may in their joint opinion be consistent with
          the general tenor of this Contract.  Any such interpretive or
          additional provisions shall be in a writing signed by both
          parties and shall be annexed hereto, provided that no such
          interpretive or additional provisions shall contravene any
          applicable federal or state regulations or any provision of the
          Governing Documents of the Fund.  No interpretive or additional
          provisions made as provided in the preceding sentence shall be
          deemed to be an amendment of this Contract.  

          16.  Notice
               Any notice shall be sufficiently given when sent by
          registered or certified mail, or by such other means as the
          parties shall agree, to the other party at the address of such
          party set forth above or at such other address as such party may
          from time to time specify in writing to the other party.
          17.  Bond
               The Custodian shall, at all times, maintain a bond in such
          form and amount as is acceptable to the Fund which shall be
          issued by a reputable fidelity insurance company authorized to do
          business in the place where such bond is issued against larceny















          PAGE 25
          and embezzlement, covering each officer and employee of the
          Custodian who may, singly or jointly with others, have access to
          securities or funds of the Fund, either directly or through
          authority to receive and carry out any certificate instruction,
          order request, note or other instrument required or permitted by
          this Agreement.  The Custodian agrees that it shall not cancel,
          terminate or modify such bond insofar as it adversely affects the
          Fund except after written notice given to the Fund not less than
          10 days prior to the effective date of such cancellation,
          termination or modification.  The Custodian shall furnish to the
          Fund a copy of each such bond and each amendment thereto.
          18.  Confidentiality
               The Custodian agrees to treat all records and other
          information relative to the Fund and its prior, present or future
          shareholders as confidential, and the Custodian, on behalf of
          itself and its employees, agrees to keep confidential all such
          information except, after prior notification to and approval in
          writing by the Fund, which approval shall not be unreasonably
          withheld and may not be withheld where the Custodian may be
          exposed to civil or criminal contempt proceedings for failure to
          comply, when requested to divulge such information by duly
          constituted authorities, or when so requested by the Fund.
          19.  Exemption from Liens
               The securities and other assets held by the Custodian for
          the Fund shall be subject to no lien or charge of any kind in
          favor of the Custodian or any person claiming through the
          Custodian, but nothing herein shall be deemed to deprive the
          Custodian of its right to invoke any and all remedies available
          at law or equity to collect amounts due it under this Agreement. 
          Neither the Custodian nor any sub-custodian appointed pursuant to
          Section 1 hereof shall have any power or authority to assign,
          hypothecate, pledge or otherwise dispose of any securities held
          by it for the Fund, except upon the direction of the Fund, duly
          given as herein provided, and only for the account of the Fund.
          20.  Massachusetts Law to Apply
               This Contract shall be construed and the provisions thereof
          interpreted under and in accordance with laws of The Commonwealth
          of Massachusetts.
          21.  Prior Contracts
               Without derogating any of the rights established by such
          contracts, this Contract supersedes and terminates, as of the
          date hereof, all prior contracts between the Fund and the
          Custodian relating to the custody of the Fund's assets.
          22.  The Parties  
               All references herein to "the Fund" are to each of the funds
          listed on Appendix A individually, as if this Contract were
          between such individual fund and the Custodian.  In the case of a
          series fund or trust, all references to "the Fund" are to the
          individual series or portfolio of such fund or trust, or to such
          fund or trust on behalf of the individual series or portfolio, as















          PAGE 26
          appropriate.  Any reference in this Contract to "the parties"
          shall mean the Custodian and such other individual Fund as to
          which the matter pertains.
          23.  Governing Documents.
               The term "Governing Documents" means the Articles of
          Incorporation, Agreement of Trust, By-Laws and Registration
          Statement filed under the Securities Act of 1933, as amended from
          time to time.
          24.  Subcustodian Agreement.
               Reference to the "Subcustodian Agreement" between the
          Custodian and Chase shall mean any such agreement which shall be
          in effect from time to time between Chase and the Custodian with
          respect to foreign assets of the Fund.
          25.  Directors and Trustees.
               It is understood and is expressly stipulated that neither
          the holders of shares in the Fund nor any Directors or Trustees
          of the Fund shall be personally liable hereunder.
          26.  Massachusetts Business Trust
               With respect to any Fund which is a party to this Contract
          and which is organized as a Massachusetts business trust, the
          term Fund means and refers to the trustees from time to time
          serving under the applicable trust agreement (Declaration of
          Trust) of such Trust as the same may be amended from time to
          time.  It is expressly agreed that the obligations of any such
          Trust hereunder shall not be binding upon any of the trustees,
          shareholders, nominees, officers, agents or employees of the
          Trust, personally, but bind only the trust property of the Trust,
          as provided in the Declaration of Trust of the Trust.  The
          execution and delivery of this Contract has been authorized by
          the trustees and signed by an authorized officer of the Trust,
          acting as such, and neither such authorization by such Trustees
          nor such execution and delivery by such officer shall be deemed
          to have been made by any of them but shall bind only the trust
          property of the Trust as provided in its Declaration of Trust.
          27.  Successors of Parties.
               This Contract shall be binding on and shall inure to the
          benefit of the Fund and the Custodian and their respective
          successors.

                    IN WITNESS WHEREOF, each of the parties has caused this
          instrument to be executed in its name and behalf by its duly
          authorized representative and its seal to be hereunder affixed as
          of the dates indicated below.

          DATED:    September 28, 1987
                    __________________



















          PAGE 27

                                      STATE STREET BANK AND TRUST
                                           COMPANY
          ATTEST:

          /s/Kathleen M. Kubit           By/s/Charles Cassidy
          _____________________       _________________________________
          Assistant Secretary            Vice President


                              T. ROWE PRICE GROWTH STOCK FUND, INC.

                              T. ROWE PRICE NEW HORIZONS FUND, INC.

                              T. ROWE PRICE NEW ERA FUND, INC.

                              T. ROWE PRICE NEW INCOME FUND, INC.

                              T. ROWE PRICE PRIME RESERVE FUND, INC.

                              T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                              T. ROWE PRICE INTERNATIONAL TRUST
                                T. Rowe Price International Stock Fund

                              T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                              T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                              T. ROWE PRICE GROWTH & INCOME FUND, INC.

                              T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                              FUND, INC.

                              T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                              T. ROWE PRICE HIGH YIELD FUND, INC.

                              T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                              T. ROWE PRICE NEW AMERICA GROWTH FUND

                              T. ROWE PRICE EQUITY INCOME FUND

                              T. ROWE PRICE GNMA FUND

                              T. ROWE PRICE CAPITAL APPRECIATION FUND

                              T. ROWE PRICE INSTITUTIONAL TRUST
                                Tax-Exempt Reserve Portfolio















          PAGE 28
                                (SIGNATURES CONTINUED)

                              T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                                New York Tax-Free Money Fund

                              T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                                New York Tax-Free Bond Fund

                              T. ROWE PRICE INTERNATIONAL TRUST
                                T. Rowe Price International Bond Fund

                              T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
                              TRUST
                                California Tax-Free Money Fund

                              T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
                              TRUST
                                California Tax-Free Bond Fund

                              T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                                Maryland Tax-Free Bond Fund

                              T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

          DATED:    September 28, 1987
                    ___________________

          ATTEST:

          /s/Nancy J. Wortman           By/s/Carmen F. Deyesu
          ____________________________  __________________________________


































          PAGE 29
                                      Appendix A

               The following Funds are parties to this Agreement and have
          so indicated their intention to be bound by such Agreement by
          executing the Agreement on the dates indicated thereon.

               T. Rowe Price California Tax-Free Income Trust on behalf of
          the 
                  California Tax-Free Bond Fund and 
                  California Tax-Free Money Fund
               T. Rowe Price Capital Appreciation Fund 

               T. Rowe Price Equity Income Fund 
               T. Rowe Price GNMA Fund 

               T. Rowe Price Growth & Income Fund, Inc. 
               T. Rowe Price Growth Stock Fund, Inc. 

               T. Rowe Price High Yield Fund, Inc. 
               T. Rowe Price Institutional Trust on behalf of the 
                  Tax-Exempt Reserve Portfolio

               T. Rowe Price International Trust on behalf of the 
                  T. Rowe Price International Bond Fund and 
                  T. Rowe Price International Stock Fund 

               T. Rowe Price New America Growth Fund 
               T. Rowe Price New Era Fund, Inc. 

               T. Rowe Price New Horizons Fund, Inc. 
               T. Rowe Price New Income Fund, Inc. 

               T. Rowe Price Prime Reserve Fund, Inc. 
               T. Rowe Price Science & Technology Fund, Inc.

               T. Rowe Price Short-Term Bond Fund, Inc. 
               T. Rowe Price State Tax-Free Income Trust on behalf of the 
                  Maryland Tax-Free Bond Fund, 
                  New York Tax-Free Bond Fund and 
                  New York Tax-Free Money Fund 

               T. Rowe Price Tax-Exempt Money Fund, Inc. 
               T. Rowe Price Tax-Free High Yield Fund, Inc. 

               T. Rowe Price Tax-Free Income Fund, Inc. 
               T. Rowe Price Tax-Free Short-Intermediate Fund, Inc. 

               T. Rowe Price U.S. Treasury Money Fund, Inc.

















          PAGE 30
                    AMENDMENT NO. 1 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

               THIS AGREEMENT, made as of this 24th day of June, 1988, by
          and between: T. Rowe Price Growth Stock Fund, Inc., T. Rowe Price
          New Horizons Fund, Inc., T. Rowe Price New Era Fund, Inc., T.
          Rowe Price New Income Fund, Inc., T. Rowe Price Prime Reserve
          Fund, Inc., T. Rowe Price International Trust, T. Rowe Price U.S.
          Treasury Money Fund, Inc., T. Rowe Price Growth & Income Fund,
          Inc., T. Rowe Price Tax-Exempt Money Fund, Inc., T. Rowe Price
          Tax-Free Income Fund, Inc., T. Rowe Price Tax-Free Short-
          Intermediate Fund, Inc., T. Rowe Price Short-Term Bond Fund,
          Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price Tax-Free
          High Yield Fund, Inc., T. Rowe Price New America Growth Fund, T.
          Rowe Price Equity Income Fund, T. Rowe Price GNMA Fund, T. Rowe
          Price Capital Appreciation Fund, T. Rowe Price Institutional
          Trust, T. Rowe Price State Tax-Free Income Trust, T. Rowe Price
          California Tax-Free Income Trust, T. Rowe Price Science &
          Technology Fund, Inc., (hereinafter together called the "Funds"
          and individually "Fund") and State Street Bank and Trust Company,
          a Massachusetts trust,

                                 W I T N E S S E T H:

               It is mutually agreed that the Custodian Contract made by
          the parties on the 28th day of September, 1987, is hereby amended
          by adding thereto the T. Rowe Price Small-Cap Value Fund, Inc.


                      T. ROWE PRICE GROWTH STOCK FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE NEW HORIZONS FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE NEW ERA FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President


















          PAGE 31
                      (SIGNATURES CONTINUED)

                      T. ROWE PRICE NEW INCOME FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE PRIME RESERVE FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE INTERNATIONAL TRUST
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
                      /s/Henry H.Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE GROWTH & INCOME FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE SHORT-TERM BOND FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE TAX-FREE INCOME FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President
















          PAGE 32
                      (SIGNATURES CONTINUED)

                      T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                           FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE HIGH YIELD FUND, INC.
                      /s/ Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE NEW AMERICA GROWTH FUND
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE EQUITY INCOME FUND
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE GNMA FUND
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE CAPITAL APPRECIATION FUND
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE INSTITUTIONAL TRUST
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President















          PAGE 33
                      (SIGNATURES CONTINUED)

                      T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                           TRUST
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE SCIENCE & TECHNOLOGY 
                           FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
                      /s/Henry H. Hopkins
                      ______________________________________________
                      By: Henry H. Hopkins
                      Vice President

                      STATE STREET BANK AND TRUST COMPANY
                      /s/William Blackwell
                      ______________________________________________
                      By:

































          PAGE 34
                    AMENDMENT NO. 2 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, between State Street Bank and Trust Company and
          each of the Parties listed on Appendix A thereto is hereby
          further amended, as of October 19, 1988, by adding thereto the T.
          Rowe Price International Discovery Fund, Inc., a separate series
          of T. Rowe Price International Trust.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND















          PAGE 35

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          /s/Henry H. Hopkins
                          ______________________________________________
                          By: Henry H. Hopkins
                          Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/Guy R. Sturgeon
                          ______________________________________________
                          By:

































          PAGE 36
                    AMENDMENT NO. 3 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988 and October 19, 1988, between State Street Bank and
          Trust Company and each of the Parties listed on Appendix A
          thereto is hereby further amended, as of February 22, 1989, by
          adding thereto the T. Rowe Price International Equity Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND
















          PAGE 37

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          /s/Henry H. Hopkins
                          ______________________________________________
                          By: Henry H. Hopkins
                          Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/K. Donelson
                          ______________________________________________
                          By:






























          PAGE 38
                    AMENDMENT NO. 4 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988 and February 22, 1989, between
          State Street Bank and Trust Company and each of the Parties
          listed on Appendix A thereto is hereby further amended, as of
          July 19, 1989, by adding thereto the Institutional International
          Funds, Inc., on behalf of the Foreign Equity Fund.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND















          PAGE 39
                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          /s/Henry H. Hopkins
                          ______________________________________________
                          By: Henry H. Hopkins
                          Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ______________________________________________
                          By:




























          PAGE 40
                    AMENDMENT NO. 5 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, and July 19,
          1989 between State Street Bank and Trust Company and each of the
          Parties listed on Appendix A thereto is hereby further amended,
          as of September 15, 1989, by adding thereto the T. Rowe Price
          U.S. Treasury Funds, Inc., on behalf of the U.S. Treasury
          Intermediate Fund and the U.S. Treasury Long-Term Fund.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND
















          PAGE 41

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund

                          /s/Henry H. Hopkins
                          ____________________________________
                          By: Henry H. Hopkins
                          Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ____________________________________
                          By:





















          PAGE 42
                    AMENDMENT NO. 6 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS


                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989
          and September 15, 1989, between State Street Bank and Trust
          Company and each of the Parties listed on Appendix A thereto is
          hereby further amended, as of December 15, 1989, by restating
          Section 2.15 as follows:

          2.15   Communications Relating to Fund Portfolio Securities.  The
          Custodian shall transmit promptly to the Fund all written
          information (including, without limitation, pendency of calls and
          maturities of domestic securities and expirations of rights in
          connection therewith and notices of exercise of call and put
          options written by the Fund and the maturity of futures contracts
          purchased or sold by the Fund) received by the Custodian from
          issuers of the domestic securities being held for the Fund by the
          Custodian, an agent appointed under Section 2.9, or sub-custodian
          appointed under Section 1.  With respect to tender or exchange
          offers, the Custodian shall transmit promptly to the Fund all
          written information received by the Custodian, an agent appointed
          under Section 2.9, or sub-custodian appointed under Section 1
          from issuers of the domestic securities whose tender or exchange
          is sought and from the party (or his agents) making the tender or
          exchange offer.  If the Fund desires to take action with respect
          to any tender offer, exchange offer or any other similar
          transaction, the Fund shall notify the Custodian of such desired
          action at least 48 hours (excluding holidays and weekends) prior
          to the time such action must be taken under the terms of the
          tender, exchange offer, or other similar transaction, and it will
          be the responsibility of the Custodian to timely transmit to the
          appropriate person(s) the Fund's notice.  Where the Fund does not
          notify the custodian of its desired action within the aforesaid
          48 hour period, the Custodian shall use its best efforts to
          timely transmit the Fund's notice to the appropriate person.  It
          is expressly noted that the parties may negotiate and agree to
          alternative procedures with respect to such 48 hour notice period
          on a selective and individual basis.


                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.















          PAGE 43

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.















          PAGE 44

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U. S. TREASURY FUNDS, INC.
                             U. S. Treasury Intermediate Fund
                             U. S. Treasury Long-Term Fund


                          /s/Carmen F. Deyesu
                          _________________________________________
                          By: Carmen F. Deyesu,
                              Treasurer

                          STATE STREET BANK AND TRUST COMPANY

                          /s/ E. D. Hawkes, Jr.
                          _________________________________________
                          By: E. D. Hawkes, Jr.
                              Vice President








































          PAGE 45
          Amendment No. 7 filed on Form SE January 25, 1990 with
          International Trust (CIK 313212) Post Effective Amendment No. 17.































































          PAGE 46
                    AMENDMENT NO. 8 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, and December 20,
          1989, between State Street Bank and Trust Company and each of the
          Parties listed on Appendix A thereto is hereby further amended,
          as of January 25, 1990, by adding thereto the T. Rowe Price
          European Stock Fund, a separate series of T. Rowe Price
          International Trust.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND
















          PAGE 47

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund

                          /s/Henry H. Hopkins
                          _________________________________________
                          By: Henry H. Hopkins
                          Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          _________________________________________
                          By:



















          PAGE 48
                    AMENDMENT NO. 9 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          and January 25, 1990 between State Street Bank and Trust Company
          and each of the Parties listed on Appendix A thereto is hereby
          further amended, as of February 21, 1990, by adding thereto the
          T. Rowe Price Index Trust, Inc., on behalf of the T. Rowe Price
          Equity Index Fund.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND
















          PAGE 49
                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                             /s/Henry H. Hopkins
                             _____________________________________
                             By:      Henry H. Hopkins
                                      Vice President


                             STATE STREET BANK AND TRUST COMPANY

                             /s/
                             ______________________________________
                             By:

















          PAGE 50
                    AMENDMENT NO. 10 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, between State Street Bank
          and Trust Company and each of the Parties listed on Appendix A
          thereto is hereby further amended, as of June 12, 1990, by adding
          thereto the T. Rowe Price Spectrum Fund, Inc., on behalf of the
          Spectrum Growth Fund and the Spectrum Income Fund.  


                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL TRUST
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund

                          T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND















          PAGE 51
                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                             /s/Henry H. Hopkins
                             _____________________________________
                             By: Henry H. Hopkins, Vice President

                             STATE STREET BANK AND TRUST COMPANY

                             /s/
                             ______________________________________
                             By:















          PAGE 52
                    AMENDMENT NO. 11 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, and June 12, 1990 between
          State Street Bank and Trust Company and each of the Parties
          listed on Appendix A thereto is hereby further amended, as of
          July 18, 1990, by adding thereto the T. Rowe Price New Asia Fund,
          a separate series of the T. Rowe Price International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND















          PAGE 53
                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                             /s/Henry H. Hopkins
                             _____________________________________
                             By: Henry H. Hopkins, Vice President

                             STATE STREET BANK AND TRUST COMPANY

                             /s/ Guy R. Sturgeon
                             ______________________________________
                             By: Guy R. Sturgeon
















          PAGE 54
                    AMENDMENT NO. 12 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, and July 18,
          1990 between State Street Bank and Trust Company and each of the
          Parties listed on Appendix A thereto is hereby further amended,
          as of October 15, 1990, by adding thereto the T. Rowe Price
          Global Government Bond Fund, a separate series of the T. Rowe
          Price International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND















          PAGE 55
                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE INSTITUTIONAL TRUST
                             Tax-Exempt Reserve Portfolio

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                             /s/Henry H. Hopkins
                             _____________________________________
                             By:  Henry H. Hopkins, Vice President

                             STATE STREET BANK AND TRUST COMPANY
                             /s/ Guy R. Sturgeon
                             ______________________________________
                             By:















          PAGE 56
                    AMENDMENT NO. 13 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, and October 15, 1990, between State Street Bank and Trust
          Company and each of the Parties listed on Appendix A thereto is
          hereby further amended, as of February 13, 1991, by adding
          thereto the Virginia Tax-Free Bond Fund and New Jersey Tax-Free
          Bond Fund, two separate series of the T. Rowe Price State Tax-
          Free Income Trust

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
















          PAGE 57
                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             Virginia Tax-Free Bond Fund
                             New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                             /s/Henry H. Hopkins
                             _____________________________________
                             By:  Henry H. Hopkins, Vice President
                             STATE STREET BANK AND TRUST COMPANY
                             /s/ Guy Sturgeon
                             ______________________________________
                             By: Vice President















          PAGE 58
                    AMENDMENT NO. 14 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, and February 13, 1991, between State
          Street Bank and Trust Company and each of the Parties listed on
          Appendix A thereto is hereby further amended, as of March 6,
          1991, by adding thereto the T. Rowe Price Balanced Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND
















          PAGE 59
                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             Virginia Tax-Free Bond Fund
                             New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                             /s/Henry H. Hopkins
                             _____________________________________
                             By:  Henry H. Hopkins, Vice President
                             STATE STREET BANK AND TRUST COMPANY
                             /s/
                             ______________________________________
                             By:















          PAGE 60
                    AMENDMENT NO. 15 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, and March 6, 1991,
          between State Street Bank and Trust Company and each of the
          Parties listed on Appendix A thereto is hereby further amended,
          as of September 12, 1991, by adding thereto the T. Rowe Price
          Adjustable Rate U.S. Government Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND















          PAGE 61
                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             Virginia Tax-Free Bond Fund
                             New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S.
                             GOVERNMENT FUND, INC.


                             /s/Henry H. Hopkins
                             _____________________________________
                             By: Henry H. Hopkins, Vice President















          PAGE 62
                             STATE STREET BANK AND TRUST COMPANY

                             /s/
                             ______________________________________
                             By:




























































          PAGE 63
                    AMENDMENT NO. 16 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

               The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991 and
          September 12, 1991, between State Street Bank and Trust Company
          and each of the Parties listed on Appendix A thereto is hereby
          further amended, as of November 6, 1991, by adding thereto the T.
          Rowe Price Japan Fund, a separate series of the T. Rowe Price
          International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund
                             T. Rowe Price Japan Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                               FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.















          PAGE 64
                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             Virginia Tax-Free Bond Fund
                             New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME 
                               TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY 
                               FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL 
                               EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                             T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S.
                             GOVERNMENT FUND, INC.


















          PAGE 65
                             /s/Henry H. Hopkins
                             _____________________________________
                             By: Henry H. Hopkins, Vice President

                             STATE STREET BANK AND TRUST COMPANY

                             /s/ 
                             ______________________________________
                             By:
























































          PAGE 66
                    AMENDMENT NO. 17 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991 and November 6, 1991, between State Street
          Bank and Trust Company and each of the Parties listed on
          Appendix A thereto is hereby further amended, as of April 23,
          1992, by adding thereto the T. Rowe Price Mid-Cap Growth Fund,
          Inc. and T. Rowe Price Short-Term Global Income Fund, a separate
          series of the T. Rowe Price International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.















          PAGE 67
                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

















          PAGE 68
                          /s/Henry H. Hopkins
                            _________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ____________________________________
                          By:
























































          PAGE 69
                    AMENDMENT NO. 18 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, and April 23, 1992, between
          State Street Bank and Trust Company and each of the Parties
          listed on Appendix A thereto is hereby further amended, as of
          September 2, 1992, by adding thereto the T. Rowe Price OTC Fund,
          a series of the T. Rowe Price OTC Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.















          PAGE 70
                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

















          PAGE 71
                          /s/Henry H. Hopkins
                          __________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          __________________________________
                          By:
























































          PAGE 72
                    AMENDMENT NO. 19 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, and
          September 2, 1992, between State Street Bank and Trust Company
          and each of the Parties listed on Appendix A thereto is hereby
          further amended, as of November 3, 1992, by adding thereto the T.
          Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.
















          PAGE 73

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund















          PAGE 74
                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          /s/Henry H. Hopkins
                          _________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          _________________________________________
                          By:




















































          PAGE 75
                    AMENDMENT NO. 20 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, and November 3, 1992, between State Street Bank and
          Trust Company and each of the Parties listed on Appendix A
          thereto is hereby further amended, as of December 16, 1992, by
          adding thereto the T. Rowe Price Dividend Growth Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.
















          PAGE 76

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund















          PAGE 77

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          /s/Henry H. Hopkins
                          _________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          _________________________________________
                          By:


















































          PAGE 78
                    AMENDMENT NO. 21 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, and December 16, 1992, between State
          Street Bank and Trust Company and each of the Parties listed on
          Appendix A thereto is hereby further amended, as of December 21,
          1992, by adding thereto the Maryland Short-Term Tax-Free Bond
          Fund, an additional series to the T. Rowe Price State Tax-Free
          Income Trust.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.
















          PAGE 79

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.















          PAGE 80
                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          /s/Henry H. Hopkins
                          _________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          _________________________________________
                          By:















































          PAGE 81
                    AMENDMENT NO. 22 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, and December 21,
          1992, between State Street Bank and Trust Company and each of the
          Parties listed on Appendix A thereto is hereby further amended,
          as of January 28, 1993, by adding thereto the Georgia Tax-Free
          Bond Fund and the Florida Insured Intermediate Tax-Free Fund,
          additional series to the T. Rowe Price State Tax-Free Income
          Trust.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.















          PAGE 82

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.















          PAGE 83
                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          /s/Henry H. Hopkins
                          _________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          _________________________________________
                          By:














































          PAGE 84
                    AMENDMENT NO. 23 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          and January 28, 1993, between State Street Bank and Trust Company
          and each of the Parties listed on Appendix A thereto is hereby
          further amended, as of April 22, 1993, by adding thereto the T.
          Rowe Price Blue Chip Growth Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.















          PAGE 85

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT 
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.
















          PAGE 86
                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          /s/Henry H. Hopkins
                          _________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          __________________________________________
                          By:














































          PAGE 87
                    AMENDMENT NO. 24 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:


                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, between State Street Bank and
          Trust Company and each of the Parties listed on Appendix A
          thereto is hereby further amended, as of September 16, 1993, by
          adding thereto the T. Rowe Price Summit Funds, Inc. and T. Rowe
          Price Summit Municipal Funds, Inc.

                 Notwithstanding anything to the contrary herein, it is
          understood that the T. Rowe Price Summit Funds, Inc. and T. Rowe
          Price Summit Municipal Funds, Inc. (collectively referred to as
          the "Funds") shall not be responsible for paying any of the fees
          or expenses set forth herein but that, in accordance with the
          Investment Management Agreement, dated September 16, 1993,
          between the Funds and T. Rowe Price Associates, Inc. ("T. Rowe
          Price"), the Funds will require T. Rowe Price to pay all such
          fees and expenses.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
















          PAGE 88
                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

















          PAGE 89
                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T. Rowe Price Summit Municipal Money Market
                            Fund
                            T. Rowe Price Summit Municipal Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ________________________________________
                          By:



















          PAGE 90
                    AMENDMENT NO. 25 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

                 The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, and September 16, 1993, between
          State Street Bank and Trust Company and each of the Parties
          listed on Appendix A thereto is hereby further amended, as of
          November 3, 1993, by adding thereto the T. Rowe Price Latin
          America Fund, a separate series of the T. Rowe Price
          International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

















          PAGE 91
                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.
















          PAGE 92
                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T. Rowe Price Summit Municipal Money Market
                            Fund
                            T. Rowe Price Summit Municipal Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ________________________________________
                          By:




























          PAGE 93
                    AMENDMENT NO. 26 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

              The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, and
          November 3, 1993, between State Street Bank and Trust Company and
          each of the Parties listed on Appendix A thereto is hereby
          further amended, as of March 1, 1994, by adding thereto the T.
          Rowe Price Equity Income Portfolio and T. Rowe Price New America
          Growth Portfolio, two separate series of the T. Rowe Price Equity
          Series, Inc. and T. Rowe Price International Stock Portfolio, a
          separate series of the T. Rowe Price International Series, Inc.

              Notwithstanding anything to the contrary herein, it is
          understood that the T. Rowe Price Equity Series, Inc. and T. Rowe
          Price International Series, Inc. (collectively referred to as the
          "Funds") shall not be responsible for paying any of the fees or
          expenses set forth herein but that, in accordance with the
          Investment Management Agreements, dated March 1, 1994, between
          the Funds and T. Rowe Price Associates, Inc. and Rowe Price-
          Fleming International, Inc. (collectively referred to as "T. Rowe
          Price"), the Funds will require T. Rowe Price to pay all such
          fees and expenses.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.























          PAGE 94
                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
















          PAGE 95
                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T. Rowe Price Summit Municipal Money Market
                            Fund
                            T. Rowe Price Summit Municipal Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
















          PAGE 96
                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ________________________________________
                          By:




















































          PAGE 97
                    AMENDMENT NO. 27 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

              The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, and March 1, 1994, between State Street Bank and Trust
          Company and each of the Parties listed on Appendix A thereto is
          hereby further amended, as of April 21, 1994, by adding thereto
          the T. Rowe Price Limited-Term Bond Portfolio, a separate series
          of the T. Rowe Price Fixed Income Series, Inc.

              Notwithstanding anything to the contrary herein, it is
          understood that the T. Rowe Price Fixed Income Series, Inc.
          (referred to as the "Fund") shall not be responsible for paying
          any of the fees or expenses set forth herein but that, in
          accordance with the Investment Management Agreement, dated April
          21, 1994, between the Fund and T. Rowe Price Associates, Inc.
          (referred to as "T. Rowe Price"), the Fund will require T. Rowe
          Price to pay all such fees and expenses.


                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund















          PAGE 98

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund
















          PAGE 99
                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T. Rowe Price Summit Municipal Money Market
                            Fund
                            T. Rowe Price Summit Municipal Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio




















          PAGE 100
                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President


                          STATE STREET BANK AND TRUST COMPANY

                          /s/
                          ________________________________________
                          By:























































          PAGE 101
                    AMENDMENT NO. 28 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

              The Custodian Contract of September 28, 1987, as amended
          June 24, 1988, October 19, 1988, February 22, 1989, July 19,
          1989, September 15, 1989, December 15, 1989, December 20, 1989,
          January 25, 1990, February 21, 1990, June 12, 1990, July 18,
          1990, October 15, 1990, February 13, 1991, March 6, 1991,
          September 12, 1991, November 6, 1991, April 23, 1992, September
          2, 1992, November 3, 1992, December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March 1, 1994, and April 21, 1994, between State Street
          Bank and Trust Company and each of the Parties listed on
          Appendix A thereto is hereby further amended, as of July 27,
          1994, by adding thereto the T. Rowe Price Personal Strategy
          Balanced Fund, T. Rowe Price Personal Strategy Growth Fund, and
          T. Rowe Price Personal Strategy Income Fund, three separate
          series of the T. Rowe Price Personal Strategy Funds, Inc.

              Notwithstanding anything to the contrary herein, it is
          understood that the T. Rowe Price Personal Strategy Funds, Inc.
          (collectively referred to as the "Funds") shall not be
          responsible for paying any of the fees or expenses set forth
          herein but that, in accordance with the Investment Management
          Agreements, dated July 27, 1994, between the Funds and T. Rowe
          Price Associates, Inc. (referred to as "T. Rowe Price"), the
          Funds will require T. Rowe Price to pay all such fees and
          expenses.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.
























          PAGE 102
                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
















          PAGE 103
                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T. Rowe Price Summit Municipal Money Market
                            Fund
                            T. Rowe Price Summit Municipal Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
















          PAGE 104
                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund

                            T. Rowe Price Personal Strategy Income Fund

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY
                          /s/
                          ________________________________________
                          By:













































          PAGE 105
                    AMENDMENT NO. 29 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS


                                 W I T N E S S E T H:

              The Custodian  Contract  of September  28,  1987, as  amended
          June  24, 1988,  October 19, 1988,  February 22,  1989, July  19,
          1989, September 15, 1989,  December 15, 1989, December  20, 1989,
          January  25, 1990,  February 21,  1990, June  12, 1990,  July 18,
          1990, October  15,  1990,  February  13,  1991,  March  6,  1991,
          September  12, 1991, November 6,  1991, April 23, 1992, September
          2, 1992, November 3, 1992,  December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March  1, 1994,  and April 21,  1994, between  State Street
          Bank  and  Trust  Company  and  each of  the  Parties  listed  on
          Appendix A  thereto is  hereby further  amended, as  of July  27,
          1994,  by  adding thereto  the  T. Rowe  Price  Personal Strategy
          Balanced Strategy Balanced Portfolio, a separate series of the T.
          Rowe Price Equity Series, Inc.

              Notwithstanding  anything  to  the  contrary  herein,  it  is
          understood  that the  T. Rowe  Price  Personal Strategy  Balanced
          Portfolio, a separate series of  the T. Rowe Price Equity Series,
          Inc.  (referred to  as the  "Fund) shall  not be  responsible for
          paying any of the fees or expenses set forth herein but  that, in
          accordance with the Investment  Management Agreement, dated  July
          27, 1994,  between the  Fund and T.  Rowe Price  Associates, Inc.
          (referred to as "T.  Rowe Price"), the Fund will require  T. Rowe
          Price to pay all such fees and expenses.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

























          PAGE 106
                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE  PRICE TAX-FREE SHORT-INTERMEDIATE  FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
















          PAGE 107
                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE  TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T.  Rowe Price  Summit  Municipal Money  Market
                            Fund
                            T.  Rowe  Price Summit  Municipal  Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio















                            T. Rowe Price Personal Strategy Balanced
                            Portfolio


          PAGE 108
                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Personal Strategy Income Fund

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY
                          /s/
                          ________________________________________
                          By:














































          PAGE 109

                    AMENDMENT NO. 30 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS

                                 W I T N E S S E T H:

              The Custodian  Contract  of September  28,  1987, as  amended
          June  24, 1988,  October 19, 1988,  February 22,  1989,  July 19,
          1989, September 15,  1989, December 15, 1989,  December 20, 1989,
          January  25, 1990,  February 21,  1990, June  12, 1990,  July 18,
          1990,  October  15,  1990,  February  13,  1991,  March  6, 1991,
          September 12, 1991, November  6, 1991, April 23, 1992,  September
          2, 1992, November 3, 1992,  December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March  1, 1994, April  21, 1994, and July  27, 1994 between
          State  Street Bank  and Trust  Company  and each  of the  Parties
          listed on  Appendix A thereto  is hereby  further amended, as  of
          September 21,  1994, by  adding thereto the  T. Rowe  Price Value
          Fund, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.
















                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.


          PAGE 110
                          T. ROWE  PRICE TAX-FREE SHORT-INTERMEDIATE  FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.















                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

          PAGE 111
                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                          FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE  TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T.  Rowe Price  Summit  Municipal Money  Market
                            Fund
                            T.  Rowe  Price Summit  Municipal  Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
                            T.  Rowe   Price  Personal  Strategy   Balanced
                            Portfolio

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Personal Strategy Income Fund
























          PAGE 112
                          T. ROWE PRICE VALUE FUND, INC.

                          /s/Henry H. Hopkins
                          ________________________________________
                          By:Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/Carol C. Ayotte
                          ________________________________________
                          By:Carol C. Ayotte, Vice President















































          PAGE 113
                    AMENDMENT NO. 31 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS


                                 W I T N E S S E T H:


              The Custodian  Contract  of September  28,  1987, as  amended
          June  24,  1988, October 19,  1988, February  22, 1989,  July 19,
          1989,  September 15, 1989, December 15,  1989, December 20, 1989,
          January  25, 1990,  February 21,  1990, June  12, 1990,  July 18,
          1990,  October  15, 1990,  February  13,  1991,  March  6,  1991,
          September 12, 1991,  November 6, 1991, April  23, 1992, September
          2, 1992, November 3, 1992,  December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March 1, 1994, April 21, 1994, July 27, 1994, and September
          21, 1994 between State Street Bank  and Trust Company and each of
          the  Parties listed  on  Appendix A  thereto  is  hereby  further
          amended, as  of November 1,  1994, by adding thereto  the T. Rowe
          Price Virginia Short-Term  Tax-Free Bond Fund, a  separate series
          of the T. Rowe Price State Tax-Free Income Trust.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.
















          PAGE 114
                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE  PRICE TAX-FREE SHORT-INTERMEDIATE  FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            Virginia Short-Term Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund















          PAGE 115

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.


                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T.  ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T.  Rowe Price  Summit  Municipal Money  Market
                            Fund
                            T.  Rowe  Price Summit  Municipal  Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
                            T. Rowe Price Personal Strategy Balanced
                               Portfolio

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Personal Strategy Income Fund


















          PAGE 116
                          T. ROWE PRICE VALUE FUND, INC.

                          /s/Henry H. Hopkins
                          ________________________________________
                          By: Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/Carol C. Ayotte
                          ________________________________________
                          By:Carol C. Ayotte, Vice President






















































          PAGE 117
                    AMENDMENT NO. 32 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS


                                 W I T N E S S E T H:


              The Custodian  Contract  of September  28,  1987, as  amended
          June  24,  1988, October 19,  1988, February  22, 1989,  July 19,
          1989,  September 15, 1989, December 15,  1989, December 20, 1989,
          January  25, 1990,  February 21,  1990, June  12, 1990,  July 18,
          1990,  October  15, 1990,  February  13,  1991,  March  6,  1991,
          September 12, 1991,  November 6, 1991, April  23, 1992, September
          2, 1992, November 3, 1992,  December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March 1, 1994, April 21, 1994, July 27, 1994, September 21,
          1994, and  November 1, 1994  between State Street Bank  and Trust
          Company and each  of the Parties listed on  Appendix A thereto is
          hereby further amended, as of November 2, 1994, by adding thereto
          the T. Rowe Price Capital Opportunity Fund, Inc. and the T.  Rowe
          Price Emerging  Markets Bond  Fund, a separate  series of  the T.
          Rowe Price International Funds, Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund
                            T. Rowe Price Emerging Markets Bond Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.
















          PAGE 118
                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE  PRICE TAX-FREE SHORT-INTERMEDIATE  FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            Virginia Short-Term Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

















          PAGE 119
                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE  BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T.  Rowe  Price Summit  Municipal  Money Market
                            Fund
                            T.  Rowe  Price Summit  Municipal  Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
                            T. Rowe Price Personal Strategy Balanced
                               Portfolio

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Personal Strategy Income Fund
















                          T. ROWE PRICE VALUE FUND, INC.


          PAGE 120
                          T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                          /s/Henry H. Hopkins
                          ________________________________________
                          By: Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY

                          /s/Carol C. Ayotte
                          ________________________________________
                          By:Carol C. Ayotte, Vice President



















































          PAGE 121
                    AMENDMENT NO. 33 TO CUSTODIAN CONTRACT BETWEEN
                       STATE STREET BANK AND TRUST COMPANY AND 
                               THE T. ROWE PRICE FUNDS


                                 W I T N E S S E T H:


              The Custodian  Contract  of September  28,  1987, as  amended
          June  24,  1988, October 19,  1988, February  22, 1989,  July 19,
          1989,  September 15, 1989, December 15,  1989, December 20, 1989,
          January  25, 1990,  February 21,  1990, June  12, 1990,  July 18,
          1990,  October  15, 1990,  February  13,  1991,  March  6,  1991,
          September 12, 1991,  November 6, 1991, April  23, 1992, September
          2, 1992, November 3, 1992,  December 16, 1992, December 21, 1992,
          January 28, 1993, April 22, 1993, September 16, 1993, November 3,
          1993, March 1, 1994, April 21, 1994, July 27, 1994, September 21,
          1994, November 1, 1994, and November 2, 1994 between State Street
          Bank  and  Trust  Company  and  each of  the  Parties  listed  on
          Appendix A  thereto is hereby further amended,  as of January 25,
          1995, by adding thereto the  T. Rowe Price Emerging Markets Stock
          Fund, a separate series of the T. Rowe Price International Funds,
          Inc.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUND, INC.

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                            T. Rowe Price International Bond Fund
                            T. Rowe Price International Stock Fund
                            T. Rowe Price International Discovery Fund
                            T. Rowe Price European Stock Fund
                            T. Rowe Price New Asia Fund
                            T. Rowe Price Global Government Bond Fund
                            T. Rowe Price Japan Fund
                            T. Rowe Price Short-Term Global Income Fund
                            T. Rowe Price Latin America Fund
                            T. Rowe Price Emerging Markets Bond Fund
                            T. Rowe Price Emerging Markets Stock Fund

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.















          PAGE 122
                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE  PRICE TAX-FREE SHORT-INTERMEDIATE  FUND,
                          INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                            Maryland Tax-Free Bond Fund
                            Maryland Short-Term Tax-Free Bond Fund
                            New York Tax-Free Bond Fund
                            New York Tax-Free Money Fund
                            Virginia Tax-Free Bond Fund
                            Virginia Short-Term Tax-Free Bond Fund
                            New Jersey Tax-Free Bond Fund
                            Georgia Tax-Free Bond Fund
                            Florida Insured Intermediate Tax-Free Fund

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                            California Tax-Free Bond Fund
                            California Tax-Free Money Fund

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                            Foreign Equity Fund

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                            U.S. Treasury Intermediate Fund
                            U.S. Treasury Long-Term Fund
                            U.S. Treasury Money Fund

                          T. ROWE PRICE INDEX TRUST, INC. 
                            T. Rowe Price Equity Index Fund

















          PAGE 123
                          T. ROWE PRICE SPECTRUM FUND, INC.
                            Spectrum Growth Fund
                            Spectrum Income Fund

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                            FUND, INC.

                          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                            T. Rowe Price OTC Fund

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE  BOND
                          FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                            T. Rowe Price Summit Cash Reserves Fund
                            T. Rowe Price Summit Limited-Term Bond Fund
                            T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                            T.  Rowe  Price Summit  Municipal  Money Market
                            Fund
                            T.  Rowe  Price Summit  Municipal  Intermediate
                            Fund
                            T. Rowe Price Summit Municipal Income Fund

                          T. ROWE PRICE EQUITY SERIES, INC.
                            T. Rowe Price Equity Income Portfolio
                            T. Rowe Price New America Growth Portfolio
                            T.  Rowe   Price  Personal  Strategy   Balanced
                            Portfolio

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                            T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                            T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                            T. Rowe Price Personal Strategy Balanced Fund
                            T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Personal Strategy Income Fund
















                          T. ROWE PRICE VALUE FUND, INC.

          PAGE 124
                          T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.


                          _____________________________________________
                          By: Henry H. Hopkins, Vice President

                          STATE STREET BANK AND TRUST COMPANY


                          _____________________________________________
                          By: Carol C. Ayotte, Vice President

















































          
 The Global Custody Agreement dated January 3, 1994, as
          amended, between The Chase Manhattan Bank, N.A. and T. Rowe Price
          Funds should be inserted here.
             






          PAGE 1
                               GLOBAL CUSTODY AGREEMENT


               This AGREEMENT is effective January 3, 1994, and is between
          THE CHASE MANHATTAN BANK, N.A. (the "Bank") and EACH OF THE

          ENTITIES LISTED ON SCHEDULE A HERETO, Individually and Separately
          (each individually, the "Customer").

          1.   Customer Accounts.

               The Bank agrees to establish and maintain the following
               accounts ("Accounts"):

               (a)  A custody account in the name of the Customer 
          ("Custody Account") for any and all stocks, shares, bonds,
          debentures, notes, mortgages or other obligations for the payment
          of money, bullion, coin and any certificates, receipts, warrants
          or other instruments representing rights to receive, purchase or
          subscribe for the same or evidencing or representing any other
          rights or interests therein and other similar property whether
          certificated or uncertificated as may be received by the Bank or
          its Subcustodian (as defined in Section 3) for the account of the
          Customer ("Securities"); and

               (b)  A deposit account in the name of the Customer ("Deposit
          Account") for any and all cash in any currency received by the
          Bank or its Subcustodian for the account of the Customer, which
          cash shall not be subject to withdrawal by draft or check.

               The Customer warrants its authority to: 1) deposit the cash
          and Securities ("Assets") received in the Accounts and 2) give
          Instructions (as defined in Section 11) concerning the Accounts. 
          The Bank may deliver securities of the same class in place of
          those deposited in the Custody Account.

               Upon written agreement between the Bank and the Customer,
          additional Accounts may be established and separately accounted
          for as additional Accounts under the terms of this Agreement.

          2.   Maintenance of Securities and Cash at Bank and Subcustodian
               Locations.

               Unless Instructions specifically require another location
               acceptable to the Bank:

               (a)  Securities will be held in the country or other
          jurisdiction in which the principal trading market for such
          Securities is located, where such Securities are to be presented
          for payment or where such Securities are acquired; and















          PAGE 2
               (b)  Cash will be credited to an account in a country or
          other jurisdiction in which such cash may be legally deposited or
          is the legal currency for the payment of public or private debts.

               Cash may be held pursuant to Instructions in either interest
          or non-interest bearing accounts as may be available for the
          particular currency.  To the extent Instructions are issued and
          the Bank can comply with such Instructions, the Bank is
          authorized to maintain cash balances on deposit for the Customer
          with itself or one of its affiliates at such reasonable rates of
          interest as may from time to time be paid on such accounts, or in
          non-interest bearing accounts as the Customer may direct, if
          acceptable to the Bank.

               If the Customer wishes to have any of its Assets held in the
          custody of an institution other than the established
          Subcustodians as defined in Section 3 (or their securities
          depositories), such arrangement must be authorized by a written
          agreement, signed by the Bank and the Customer.

          3.   Subcustodians and Securities Depositories.

               The Bank may act under this Agreement through the
          subcustodians listed in Schedule B of this Agreement with which
          the Bank has entered into subcustodial agreements
          ("Subcustodians").  The Customer authorizes the Bank to hold
          Assets in the Accounts in accounts which the Bank has established
          with one or more of its branches or Subcustodians.  The Bank and
          Subcustodians are authorized to hold any of the Securities in
          their account with any securities depository in which they
          participate.

               The Bank reserves the right to add new, replace or remove
          Subcustodians.  The Customer will be given reasonable notice by
          the Bank of any amendment to Schedule B.  Upon request by the
          Customer, the Bank will identify the name, address and principal
          place of business of any Subcustodian of the Customer's Assets
          and the name and address of the governmental agency or other
          regulatory authority that supervises or regulates such
          Subcustodian.

          4.   Use of Subcustodian.

               (a)  The Bank will identify such Assets on its books as
               belonging to the Customer.

               (b)  A Subcustodian will hold such Assets together with
          assets belonging to other customers of the Bank in accounts
          identified on such Subcustodian's books as special custody
          accounts for the exclusive benefit of customers of the Bank.

               (c)  Any Assets in the Accounts held by a Subcustodian will
          be subject only to the instructions of the Bank or its agent.  












          PAGE 3
          Any Securities held in a securities depository for the account of
          a Subcustodian will be subject only to the instructions of such
          Subcustodian.

               (d)  Any agreement the Bank enters into with a Subcustodian
          for holding its customer's assets shall provide that such assets
          will not be subject to any right, charge, security interest, lien
          or claim of any kind in favor of such Subcustodian or its
          creditors except for a claim for payment for safe custody or
          administration, and that the beneficial ownership of such assets
          will be freely transferable without the payment of money or value
          other than for safe custody or administration.  The foregoing
          shall not apply to the extent of any special agreement or
          arrangement made by the Customer with any particular
          Subcustodian.

          5.   Deposit Account Transactions.

               (a)  The Bank or its Subcustodians will make payments from
          the Deposit Account upon receipt of Instructions which include
          all information required by the Bank.

               (b)  In the event that any payment to be made under this
          Section 5 exceeds the funds available in the Deposit Account, the
          Bank, in its discretion, may advance the Customer such excess
          amount which shall be deemed a loan payable on demand, bearing
          interest at the rate customarily charged by the Bank on similar
          loans.

               (c)  If the Bank credits the Deposit Account on a payable
          date, or at any time prior to actual collection and
          reconciliation to the Deposit Account, with interest, dividends,
          redemptions or any other amount due, the Customer will promptly
          return any such amount upon oral or written notification: (i)
          that such amount has not been received in the ordinary course of
          business or (ii) that such amount was incorrectly credited.  If
          the Customer does not promptly return any amount upon such
          notification, the Bank shall be entitled, upon oral or written
          notification to the Customer, to reverse such credit by debiting
          the Deposit Account for the amount previously credited.  The Bank
          or its Subcustodian shall have no duty or obligation to institute
          legal proceedings, file a claim or a proof of claim in any
          insolvency proceeding or take any other action with respect to
          the collection of such amount, but may act for the Customer upon
          Instructions after consultation with the Customer.

          6.   Custody Account Transactions.

               (a)  Securities will be transferred, exchanged or delivered
          by the Bank or its Subcustodian upon receipt by the Bank of
          Instructions which include all information required by the Bank. 
          Settlement and payment for Securities received for, and delivery
          of Securities out of, the Custody Account may be made in 












          PAGE 4
          accordance with the customary or established securities trading
          or securities processing practices and procedures in the
          jurisdiction or market in which the transaction occurs,
          including, without limitation, delivery of Securities to a
          purchaser, dealer or their agents against a receipt with the
          expectation of receiving later payment and free delivery. 
          Delivery of Securities out of the Custody Account may also be
          made in any manner specifically required by Instructions
          acceptable to the Bank.

               (b)  The Bank, in its discretion, may credit or debit the
          Accounts on a contractual settlement date with cash or Securities
          with respect to any sale, exchange or purchase of Securities. 
          Otherwise, such transactions will be credited or debited to the
          Accounts on the date cash or Securities are actually received by
          the Bank and reconciled to the Account.

               (i)  The Bank may reverse credits or debits made to the
               Accounts in its discretion if the related transaction
               fails to settle within a reasonable period, determined
               by the Bank in its discretion, after the contractual
               settlement date for the related transaction.

               (ii) If any Securities delivered pursuant to this
               Section 6 are returned by the recipient thereof, the
               Bank may reverse the credits and debits of the
               particular transaction at any time.

          7.   Actions of the Bank.

               The Bank shall follow Instructions received regarding assets
          held in the Accounts.  However, until it receives Instructions to
          the contrary, the Bank will:

               (a)  Present for payment any Securities which are called,
          redeemed or retired or otherwise become payable and all coupons
          and other income items which call for payment upon presentation,
          to the extent that the Bank or Subcustodian is actually aware of
          such opportunities.

               (b)  Execute in the name of the Customer such ownership and
          other certificates as may be required to obtain payments in
          respect of Securities.

               (c)  Exchange interim receipts or temporary Securities for
          definitive Securities.

               (d)  Appoint brokers and agents for any transaction
          involving the Securities, including, without limitation,
          affiliates of the Bank or any Subcustodian.

               (e)  Issue statements to the Customer, at times mutually
          agreed upon, identifying the Assets in the Accounts.












          PAGE 5
               The Bank will send the Customer an advice or notification of
          any transfers of Assets to or from the Accounts.  Such
          statements, advices or notifications shall indicate the identity
          of the entity having custody of the Assets.  Unless the Customer
          sends the Bank a written exception or objection to any Bank
          statement within ninety (90) days of receipt, the Customer shall
          be deemed to have approved such statement.  The Bank shall, to
          the extent permitted by law, be released, relieved and discharged
          with respect to all matters set forth in such statement or
          reasonably implied therefrom as though it had been settled by the
          decree of a court of competent jurisdiction in an action where
          the Customer and all persons having or claiming an interest in
          the Customer or the Customer's Accounts were parties if: (a) the
          Customer has failed to provide a written exception or objection
          to any Bank statement within ninety (90) days of receipt and
          where the Customer's failure to so provide a written exception or
          objection within such ninety (90) day period has limited the
          Bank's (i) access to the records, materials and other information
          required to investigate the Customer's exception or objection,
          and (ii) ability to recover from third parties any amounts for
          which the Bank may become liable in connection with such
          exception or objection, or (b) where the Customer has otherwise
          explicitly approved any such statement.

               All collections of funds or other property paid or
          distributed in respect of Securities in the Custody Account shall
          be made at the risk of the Customer.  The Bank shall have no
          liability for any loss occasioned by delay in the actual receipt
          of notice by the Bank or by its Subcustodians of any payment,
          redemption or other transaction regarding Securities in the
          Custody Account in respect of which the Bank has agreed to take
          any action under this Agreement.

          8.   Corporate Actions; Proxies.

               Whenever the Bank receives information concerning the
          Securities which requires discretionary action by the beneficial
          owner of the Securities (other than a proxy), such as
          subscription rights, bonus issues, stock repurchase plans and
          rights offerings, or legal notices or other material intended to
          be transmitted to securities holders ("Corporate Actions"), the
          Bank will give the Customer notice of such Corporate Actions to
          the extent that the Bank's central corporate actions department
          has actual knowledge of a Corporate Action in time to notify its
          customers.

               When a rights entitlement or a fractional interest resulting
          from a rights issue, stock dividend, stock split or similar
          Corporate Action is received which bears an expiration date, the
          Bank will endeavor to obtain Instructions from the Customer or
          its Authorized Person, but if Instructions are not received in
          time for the Bank to take timely action, or actual notice of such
          Corporate Action was received too late to seek Instructions, the 












          PAGE 6
          Bank is authorized to sell such rights entitlement or fractional
          interest and to credit the Deposit Account with the proceeds or
          take any other action it deems, in good faith, to be appropriate
          in which case it shall be held harmless for any such action.

               The Bank will deliver proxies to the Customer or its
          designated agent pursuant to special arrangements which may have
          been agreed to in writing.  Such proxies shall be executed in the
          appropriate nominee name relating to Securities in the Custody
          Account registered in the name of such nominee but without
          indicating the manner in which such proxies are to be voted; and
          where bearer Securities are involved, proxies will be delivered
          in accordance with Instructions.

          9.   Nominees.

               Securities which are ordinarily held in registered form may
          be registered in a nominee name of the Bank, Subcustodian or
          securities depository, as the case may be.  The Bank may without
          notice to the Customer cause any such Securities to cease to be
          registered in the name of any such nominee and to be registered
          in the name of the Customer.  In the event that any Securities
          registered in a nominee name are called for partial redemption by
          the issuer, the Bank may allot the called portion to the
          respective beneficial holders of such class of security pro rata
          or in any other manner that is fair, equitable and practicable. 
          The Customer agrees to hold the Bank, Subcustodians, and their
          respective nominees harmless from any liability arising directly
          or indirectly from their status as a mere record holder of
          Securities in the Custody Account.

          10.  Authorized Persons.

               As used in this Agreement, the term "Authorized Person"
          means employees or agents including investment managers as have
          been designated by written notice from the Customer or its
          designated agent to act on behalf of the Customer under this
          Agreement.  Such persons shall continue to be Authorized Persons
          until such time as the Bank receives Instructions from the
          Customer or its designated agent that any such employee or agent
          is no longer an Authorized Person.

          11.  Instructions.

               The term "Instructions" means instructions of any Authorized
          Person received by the Bank, via telephone, telex, TWX, facsimile
          transmission, bank wire or other teleprocess or electronic
          instruction or trade information system acceptable to the Bank
          which the Bank believes in good faith to have been given by
          Authorized Persons or which are transmitted with proper testing
          or authentication pursuant to terms and conditions which the Bank
          may specify.  Unless otherwise expressly provided, all 













          PAGE 7
          Instructions shall continue in full force and effect until
          canceled or superseded.

               Any Instructions delivered to the Bank by telephone shall
          promptly thereafter be confirmed in writing by an Authorized
          Person (which confirmation may bear the facsimile signature of
          such Person), but the Customer will hold the Bank harmless for
          the failure of an Authorized Person to send such confirmation in
          writing, the failure of such confirmation to conform to the
          telephone instructions received or the Bank's failure to produce
          such confirmation at any subsequent time.  The Bank may
          electronically record any Instructions given by telephone, and
          any other telephone discussions with respect to the Custody
          Account.  The Customer shall be responsible for safeguarding any
          testkeys, identification codes or other security devices which
          the Bank shall make available to the Customer or its Authorized
          Persons.

          12.  Standard of Care; Liabilities.

               (a)  The Bank shall be responsible for the performance of
          only such duties as are set forth in this Agreement or expressly
          contained in Instructions which are consistent with the
          provisions of this Agreement.  Notwithstanding anything to the
          contrary in this Agreement:

               (i)  The Bank will use reasonable care with respect to
               its obligations under this Agreement and the
               safekeeping of Assets.  The Bank shall be liable to the
               Customer for any loss which shall occur as the result
               of the failure of a Subcustodian to exercise reasonable
               care with respect to the safekeeping of such Assets to
               the same extent that the Bank would be liable to the
               Customer if the Bank were holding such Assets in New
               York.  In the event of any loss to the Customer by
               reason of the failure of the Bank or its Subcustodian
               to utilize reasonable care, the Bank shall be liable to
               the Customer only to the extent of the Customer's
               direct damages, and shall in no event be liable for any
               special or consequential damages.

               (ii) The Bank will not be responsible for any act,
               omission, default or for the solvency of any broker or
               agent which it or a Subcustodian appoints unless such
               appointment was made negligently or in bad faith or for
               any loss due to the negligent act of such broker or
               agent except to the extent that such broker or agent
               (other than a Subcustodian) performs in a negligent
               manner which is the cause of the loss to the Customer
               and the Bank failed to exercise reasonable care in
               monitoring such broker's or agent's performance where
               Customer has requested and Bank has agreed to accept
               such monitoring responsibility.












          PAGE 8
               (iii)      The Bank shall be indemnified by, and
               without liability to the Customer for any action taken
               or omitted by the Bank whether pursuant to Instructions
               or otherwise within the scope of this Agreement if such
               act or omission was in good faith, without negligence. 
               In performing its obligations under this Agreement, the
               Bank may rely on the genuineness of any document which
               it believes in good faith to have been validly
               executed.

               (iv) The Customer agrees to pay for and hold the Bank
               harmless from any liability or loss resulting from the
               imposition or assessment of any taxes or other
               governmental charges, and any related expenses with
               respect to income from or Assets in the Accounts,
               except to the extent that the Bank has failed to
               exercise reasonable care in performing any obligations
               which the Bank may have agreed to assume (in addition
               to those stated in this Agreement) with respect to
               taxes and such failure by the Bank is the direct cause
               of such imposition or assessment of such taxes, charges
               or expenses.

               (v)  The Bank shall be entitled to rely, and may act,
               upon the advice of counsel (who may be counsel for the
               Customer) on all legal matters and shall be without
               liability for any action reasonably taken or omitted
               pursuant to such advice; provided, that the Bank gives
               (to the extent practicable) prior notice to Customer of
               Bank's intention to so seek advice of counsel and an
               opportunity for consultation with Customer on the
               proposed contact with counsel.

               (vi) The Bank represents and warrants that it currently
               maintain a banker's blanket bond which provides
               standard fidelity and non-negligent loss coverage with
               respect to the Securities and Cash which may be held by
               Subcustodians pursuant to this Agreement.  The Bank
               agrees that if at any time it for any reason
               discontinues such coverage, it shall immediately give
               sixty (60) days' prior written notice to the Customer. 
               The Bank need not maintain any insurance for the
               benefit of the Customer.

               (vii)      Without limiting the foregoing, the Bank
               shall not be liable for any loss which results from: 
               (1) the general risk of investing, or (2) investing or
               holding Assets in a particular country including, but
               not limited to, losses resulting from nationalization,
               expropriation or other governmental actions; regulation
               of the banking or securities industry; currency
               restrictions, devaluations or fluctuations; and market 













          PAGE 9
               conditions which prevent the orderly execution of securities
               transactions or affect the value of Assets.

               (viii)    Neither party shall be liable to the other
               for any loss due to forces beyond their control
               including, but not limited to strikes or work
               stoppages, acts of war or terrorism, insurrection,
               revolution, nuclear fusion, fission or radiation, or
               acts of God.

               (b)  Consistent with and without limiting the first
          paragraph of this Section 12, it is specifically acknowledged
          that the Bank shall have no duty or responsibility to:

               (i)  question Instructions or make any suggestions to
               the Customer or an Authorized Person regarding such
               Instructions;

               (ii) supervise or make recommendations with respect to
               investments or the retention of Securities;

               (iii)     advise the Customer or an Authorized Person
               regarding any default in the payment of principal or
               income of any security other than as provided in
               Section 5(c) of this Agreement;

               (iv) evaluate or report to the Customer or an
               Authorized Person regarding the financial condition of
               any broker, agent (other than a Subcustodian) or other
               party to which Securities are delivered or payments are
               made pursuant to this Agreement;

               (v)  review or reconcile trade confirmations received
               from brokers.  The Customer or its Authorized Persons
               (as defined in Section 10) issuing Instructions shall
               bear any responsibility to review such confirmations
               against Instructions issued to and statements issued by
               the Bank.

               (c)  The Customer authorizes the Bank to act under this
          Agreement notwithstanding that the Bank or any of its divisions
          or affiliates may have a material interest in a transaction, or
          circumstances are such that the Bank may have a potential
          conflict of duty or interest including the fact that the Bank or
          any of its affiliates may provide brokerage services to other
          customers, act as financial advisor to the issuer of Securities,
          act as a lender to the issuer of Securities, act in the same
          transaction as agent for more than one customer, have a material
          interest in the issue of Securities, or earn profits from any of
          the activities listed herein.

          13.  Fees and Expenses.













          PAGE 10
               The Customer agrees to pay the Bank for its services under
          this Agreement such amount as may be agreed upon in writing,
          together with the Bank's reasonable out-of-pocket or incidental
          expenses, including, but not limited to, reasonable legal fees. 
          The Bank shall have a lien on and is authorized to charge any
          Accounts of the Customer for any amount owing to the Bank under
          any provision of this Agreement upon notice to the Customer.

          14.  Miscellaneous.

               (a)  Foreign Exchange Transactions.  Pursuant to
          Instructions, which may be standing Instructions, to facilitate
          the administration of the Customer's trading and investment
          activity, the Bank is authorized to enter into spot or forward
          foreign exchange contracts with the Customer or an Authorized
          Person for the Customer and may also provide foreign exchange
          through its subsidiaries or Subcustodians.  The Bank may
          establish rules or limitations concerning any foreign exchange
          facility made available.  In all cases where the Bank, its
          subsidiaries, affiliates or Subcustodians enter into a foreign
          exchange contract related to Accounts, the terms and conditions
          of the then current foreign exchange contract of the Bank, its
          subsidiary, affiliate or Subcustodian and, to the extent not
          inconsistent, this Agreement shall apply to such transaction.

               (b)  Certification of Residency, etc.  The Customer
          certifies that it is a resident of the United States and agrees
          to notify the Bank of any changes in residency.  The Bank may
          rely upon this certification or the certification of such other
          facts as may be required to administer the Bank's obligations
          under this Agreement.  The Customer will indemnify the Bank
          against all losses, liability, claims or demands arising directly
          or indirectly from any such certifications.

               (c)  Access to Records.  The Bank shall allow the Customer's
          independent public accountants, officers and advisers reasonable
          access to the records of the Bank relating to the Assets as is
          required in connection with their examination of books and
          records pertaining to the Customer's affairs.  Subject to
          restrictions under applicable law, the Bank shall also obtain an
          undertaking to permit the Customer's independent public
          accountants reasonable access to the records of any Subcustodian
          which has physical possession of any Assets as may be required in
          connection with the examination of the Customer's books and
          records.

               (d)  Governing Law; Successors and Assigns.  This Agreement
          shall be governed by the laws of the State of New York and shall
          not be assignable by either party, but shall bind the successors
          in interest of the Customer and the Bank.















          PAGE 11
               (e)  Entire Agreement; Applicable Riders.  Customer
          represents that the Assets deposited in the Accounts are (Check
          one):

                  X *  Employee Benefit Plan or other assets subject to the
               Employee Retirement Income
                    Security Act of 1974, as amended ("ERISA");

                  X **  Mutual Fund assets subject to certain Securities
          and Exchange Commission
                     ("SEC") rules and regulations;

                  X ***  Neither of the above.

               With respect to each Customer, this Agreement consists
               exclusively of this document together with Schedules A, B,
               Exhibits I - _______ and the following Rider(s) to the
               extent indicated on Schedule A hereto opposite the name of
               the Customer under the column headed "Applicable Riders to
               Agreement":

                 X    ERISA


                 X    MUTUAL FUND


                      SPECIAL TERMS AND CONDITIONS

               There are no other provisions of this Agreement and this
          Agreement supersedes any other agreements, whether written or
          oral, between the parties.  Any amendment to this Agreement must
          be in writing, executed by both parties.

               (f)  Severability.  In the event that one or more provisions
          of this Agreement are held invalid, illegal or enforceable in any
          respect on the basis of any particular circumstances or in any
          jurisdiction, the validity, legality and enforceability of such
          provision or provisions under other circumstances or in other
          jurisdictions and of the remaining provisions will not in any way
                                        ____________________

               *    With  respect to  each Customer  listed  on Schedule  A
                    hereto under the heading "ERISA Trusts".

               **   With  respect to  each Customer  listed  on Schedule  A
                    hereto      under      the      heading     "Investment
                    Companies/Portfolios  Registered  under  the Investment
                    Company Act of 1940".

               ***  With  respect to  certain of  the  Customers listed  on
                    Schedule A hereto under the heading "Separate Accounts"
                    as indicated on Schedule A.












          be affected or impaired.


          PAGE 12
               (g)  Waiver.  Except as otherwise provided in this
          Agreement, no failure or delay on the part of either party in
          exercising any power or right under this Agreement operates as a
          waiver, nor does any single or partial exercise of any power or
          right preclude any other or further exercise, or the exercise of
          any other power or right.  No waiver by a party of any provision
          of this Agreement, or waiver of any breach or default, is
          effective unless in writing and signed by the party against whom
          the waiver is to be enforced.

               (h)  Notices.  All notices under this Agreement shall be
          effective when actually received.  Any notices or other
          communications which may be required under this Agreement are to
          be sent to the parties at the following addresses or such other
          addresses as may subsequently be given to the other party in
          writing:


               Bank:     The Chase Manhattan Bank, N.A.
                         Chase MetroTech Center
                         Brooklyn, NY  11245
                         Attention:  Global Investor Services
                         Telephone:  (718) 242-3455
                         Facsimile:  (718) 242-1374                         
                                 
               Copy to:  The Chase Manhattan Bank, N.A.
                         Woolgate House
                         Coleman Street
                         London EC2P 2HD England
                         Attention: Global Investor Services
                         Telephone: 44-71-962-5000
                         Facsimile: 44-71-962-5377
                         Telex: 8954681CMBG 

               Customer: Name of Customer from Schedule A
                         c/o T. Rowe Price
                         100 East Pratt Street
                         Baltimore, MD  21202
                         Attention: Treasurer
                         Telephone: (410) 625-6658
                         Facsimile: (410) 547-0180

               (i)  Termination.  This Agreement may be terminated by the
          Customer or the Bank by giving ninety (90) days written notice to
          the other, provided that such notice to the Bank shall specify
          the names of the persons to whom the Bank shall deliver the
          Assets in the Accounts.  If notice of termination is given by the
          Bank, the Customer shall, within ninety (90) days following
          receipt of the notice, deliver to the Bank Instructions
          specifying the names of the persons to whom the Bank shall












          deliver the Assets.  In either case the Bank will deliver the
          Assets to the persons so specified, after deducting any amounts
          which the Bank determines in good faith to be owed to it under 

          PAGE 13
          Section 13.  If within ninety (90) days following receipt of a
          notice of termination by the Bank, the Bank does not receive
          Instructions from the Customer specifying the names of the
          persons to whom the Bank shall deliver the Assets, the Bank, at
          its election, may deliver the Assets to a bank or trust company
          doing business in the State of New York to be held and disposed
          of pursuant to the provisions of this Agreement, or to Authorized
          Persons, or may continue to hold the Assets until Instructions
          are provided to the Bank.

               (j)  Entire Agreement.  This Agreement, including the
          Schedules and Riders hereto, embodies the entire agreement and
          understanding of the parties in respect of the subject matter
          contained in this Agreement.  This Agreement supersedes all other
          custody or other agreements between the parties with respect to
          such subject matter, which prior agreements are hereby terminated
          effective as of the date hereof and shall have no further force
          or effect. 


                                   EACH OF THE CUSTOMERS, INDIVIDUALLY
                                   AND SEPARATELY LISTED ON SECTION I OF
                                   SCHEDULE A HERETO

                                   /s/Carmen F. Deyesu
                                   By:________________________________
                                        Carmen F. Deyesu
                                        Treasurer & Vice President


                                   EACH OF THE CUSTOMERS, INDIVIDUALLY
                                   AND SEPARATELY LISTED ON SECTION II OF
                                   SCHEDULE A HERETO

                                   /s/Alvin M. Younger
                                   By:____________________________________
                                        Alvin M. Younger
                                        Treasurer


                                   EACH OF THE CUSTOMERS, INDIVIDUALLY
                                   AND SEPARATELY LISTED ON SECTION III OF
                                   SCHEDULE A HERETO

                                   /s/Alvin M. Younger
                                   By:___________________________________
                                        Alvin M. Younger
                                        Treasurer















































































          PAGE 14
                                   THE CHASE MANHATTAN BANK, N.A.

                                   /s/Alan Naughton
                                   By:_________________________________
                                        Alan Naughton
                                        Vice President


          STATE OF            )
                              :  ss.
          COUNTY OF           )


          On this           day of                    , 19  , before me
          personally came                                , to me known, who
          being by me duly sworn, did depose and say that he/she resides in 
                                at                                      ;
          that he/she is                                           of       
                                                         , the entity
          described in and which executed the foregoing instrument; that
          he/she knows the seal of said entity, that the seal affixed to
          said instrument is such seal, that it was so affixed by order of
          said entity, and that he/she signed his/her name thereto by like
          order.



                                   __________________________________


          Sworn to before me this               
          day of               , 19     .

          ________________________________
                  Notary






























          PAGE 15
          STATE OF       )
                         :  ss.
          COUNTY OF      )


               On this                 day of                               
          ,19  , before me personally came                            , to
          me known, who being by me duly sworn, did depose and say that
          he/she resides in
          at                                                      ; that
          he/she is a Vice President of THE CHASE MANHATTAN BANK, (National
          Association), the corporation described in and which executed the
          foregoing instrument; that he/she knows the seal of said
          corporation, that the seal affixed to said instrument is such
          corporate seal, that it was so affixed by order of the Board of
          Directors of said corporation, and that he/she signed his/her
          name thereto by like order.



                                   ___________________________________


          Sworn to before me this                     
          day of                 , 19        .


          ___________________________________
                  Notary




































          PAGE 16
                                                            Schedule A

                                                            Page 1 of 2



                   LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO

                            GLOBAL CUSTODY AGREEMENT WITH
                            THE CHASE MANHATTAN BANK, N.A.

                                DATED JANUARY 3, 1994



                                                   APPLICABLE RIDERS TO
             CUSTOMER                              GLOBAL CUSTODY AGREEMENT


          I. INVESTMENT COMPANIES/PORTFOLIOS       The Mutual Fund Rider is
             REGISTERED UNDER THE INVESTMENT       applicable to all
             COMPANY ACT OF 1940                   Customers listed under
                                                   Section I of this 
                                                   Schedule A.

             Equity Funds

             T. Rowe Price Balanced Fund, Inc.
             T. Rowe Price Blue Chip Growth Fund, Inc.
             T. Rowe Price Capital Appreciation Fund
             T. Rowe Price Dividend Growth Fund, Inc.
             T. Rowe Price Equity Income Fund
             T. Rowe Price Growth & Income Fund, Inc.
             T. Rowe Price Growth Stock Fund, Inc.
             Institutional International Funds, Inc. on behalf of:
                Foreign Equity Fund
             T. Rowe Price International Funds, Inc. on behalf of:
                T. Rowe Price European Stock Fund
                T. Rowe Price International Discovery Fund
                T. Rowe Price International Stock Fund
                T. Rowe Price Japan Fund
                T. Rowe Price Latin America Fund
                T. Rowe Price New Asia Fund
             T. Rowe Price Mid-Cap Growth Fund, Inc.
             T. Rowe Price New Era Fund, Inc.
             T. Rowe Price New Horizons Fund, Inc.
             T. Rowe Price OTC Fund, Inc. on behalf of:
                T. Rowe Price OTC Fund
             T. Rowe Price Science & Technology Fund, Inc.
             T. Rowe Price Small Cap Value Fund, Inc.
             CUNA Mutual Funds, Inc. on behalf of:
                CUNA Mutual Cornerstone Fund













          PAGE 17
                                                   Schedule A
                                                   Page 2 of 2



                                                   APPLICABLE RIDERS TO
             CUSTOMER                              GLOBAL CUSTODY AGREEMENT


             Income Funds

             T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
             T. Rowe Price High Yield Fund, Inc.
             T. Rowe Price New Income Fund, Inc.
             T. Rowe Price Short-Term Bond Fund, Inc.
             T. Rowe Price Summit Funds, Inc. on behalf of:
                T. Rowe Price Summit Limited-Term Bond Fund
             T. Rowe Price International Funds, Inc. on behalf of:
                T. Rowe Price Global Government Bond Fund
                T. Rowe Price International Bond Fund
                T. Rowe Price Short-Term Global Income Fund

          II.  ACCOUNTS SUBJECT TO ERISA           The ERISA Rider is
                                                   applicable to all
               T. Rowe Price Trust Company, as     Customers under Section
                 Trustee for the Johnson Matthey   II of this Schedule A.
                 Salaried Employee Savings Plan

               Common Trust Funds

               T. Rowe Price Trust Company, as Trustee
               for the International Common Trust Fund
               on behalf of the Underlying Trusts:

                 Foreign Discovery Trust
                 Foreign Discovery Trust-Augment
                 Pacific Discovery Trust
                 European Discovery Trust
                 Japan Discovery Trust
                 Latin American Discovery Trust

               New York City International Common Trust Fund

          III. OTHER                               No Riders are applicable
                                                   to the Customer listed
               RPFI International Partners, L.P.   under Section III of
                                                   this Schedule A. 
















          PAGE 18
                       ERISA Rider to Global Custody Agreement
                      Between The Chase Manhattan Bank, N.A. and
                   Each of the Entities Listed on Schedule A Hereto
                              effective  January 3, 1994


             Customer represents that the Assets being placed in the
          Bank's custody are subject to ERISA.  It is understood that in
          connection therewith the Bank is a service provider and not a
          fiduciary of the plan and trust to which the assets are related. 
          The Bank shall not be considered a party to the underlying plan
          and trust and the Customer hereby assumes all responsibility to
          assure that Instructions issued under this Agreement are in
          compliance with such plan and trust and ERISA.

             This Agreement will be interpreted as being in compliance
          with the Department of Labor Regulations Section 2550.404b-1
          concerning the maintenance of indicia of ownership of plan assets
          outside of the jurisdiction of the district courts of the United
          States.

             The following modifications are made to the Agreement:

             Section 3.  Subcustodians and Securities Depositories.

             Add the following language to the end of Section 3:

             As used in this Agreement, the term Subcustodian and the
             term securities depositories include a branch of the Bank,
             a branch of a qualified U.S. bank, an eligible foreign
             custodian, or an eligible foreign securities depository,
             where such terms shall mean:

             (a) "qualified U.S. bank" shall mean a U.S. bank as
                 described in paragraph (a)(2)(ii)(A)(1) of the
                 Department of Labor Regulations Section 2550.404b-1;

             (b) "eligible foreign custodian" shall mean a banking
                 institution incorporated or organized under the laws
                 of a country other than the United States which is
                 supervised or regulated by that country's government
                 or an agency thereof or other regulatory authority in
                 the foreign jurisdiction having authority over banks;
                 and

             (c) "eligible foreign securities depository" shall mean a
                 securities depository or clearing agency,
                 incorporated or organized under the laws of a country
                 other than the United States, which is supervised or
                 regulated by that country's government or an agency
                 thereof or other regulatory authority in the foreign
                 jurisdiction having authority over such depositories
                 or clearing agencies and which is described in
                 paragraph (c)(2) of the Department of Labor
                 Regulations Section 2550.404b-1.

             Section 4.  Use of Subcustodian.








          PAGE 19
             Subsection (d) of this section is modified by deleting the
             last sentence.

             Section 5.  Deposit Account Payments.

             Subsection (b) is amended to read as follows:

             (b)  In the event that any payment made under this Section
             5 exceeds the funds available in the Deposit Account, such
             discretionary advance shall be deemed a service provided
             by the Bank under this Agreement for which it is entitled
             to recover its costs as may be determined by the Bank in
             good faith.

             Section 10.  Authorized Persons.

             Add the following paragraph at the end of Section 10:

             Customer represents that: a) Instructions will only be issued
             by or for a fiduciary pursuant to Department of Labor
             Regulation Section 404b-1 (a)(2)(i) and b) if Instructions
             are to be issued by an investment manager, such entity will
             meet the requirements of Section 3(38) of ERISA and will have
             been designated by the Customer to manage assets held in the
             Customer Accounts ("Investment Manager"). An Investment
             Manager may designate certain of its employees to act as
             Authorized Persons under this Agreement.

             Section 14(a).  Foreign Exchange Transactions.

             Add the following paragraph at the end of Subsection 14(a):

             Instructions to execute foreign exchange transactions with
             the Bank, its subsidiaries, affiliates or Subcustodians will
             include (1) the time period in which the transaction must be
             completed; (2) the location i.e., Chase New York, Chase
             London, etc. or the Subcustodian with whom the contract is to
             be executed and (3) such additional information and
             guidelines as may be deemed necessary; and, if the
             Instruction is a standing Instruction, a provision allowing
             such Instruction to be overridden by specific contrary
             Instructions.























          PAGE 20
                    Mutual Fund Rider to Global Custody Agreement
                      Between The Chase Manhattan Bank, N.A. and
                   Each of the Entities Listed on Schedule A Hereto
                              effective January 3, 1994


             Customer represents that the Assets being placed in the
          Bank's custody are subject to the Investment Company Act of 1940
          (the Act), as the same may be amended from time to time.

             Except to the extent that the Bank has specifically agreed to
          comply with a condition of a rule, regulation, interpretation
          promulgated by or under the authority of the SEC or the Exemptive
          Order applicable to accounts of this nature issued to the Bank
          (Investment Company Act of 1940, Release No. 12053, November 20,
          1981), as amended, or unless the Bank has otherwise specifically
          agreed, the Customer shall be solely responsible to assure that
          the maintenance of Assets under this Agreement complies with such
          rules, regulations, interpretations or exemptive order
          promulgated by or under the authority of the Securities Exchange
          Commission.

             The following modifications are made to the Agreement:

             Section 3.  Subcustodians and Securities Depositories.

             Add the following language to the end of Section 3:

             The terms Subcustodian and securities depositories as used in
             this Agreement shall mean a branch of a qualified U.S. bank,
             an eligible foreign custodian or an eligible foreign
             securities depository, which are further defined as follows:

             (a)  "qualified U.S. Bank" shall mean a qualified U.S. bank
             as defined in Rule 17f-5 under the Investment Company Act of
             1940;

             (b)  "eligible foreign custodian" shall mean (i) a banking
             institution or trust company incorporated or organized under
             the laws of a country other than the United States that is
             regulated as such by that country's government or an agency
             thereof and that has shareholders' equity in excess of $200
             million in U.S. currency (or a foreign currency equivalent
             thereof), (ii) a majority owned direct or indirect subsidiary
             of a qualified U.S. bank or bank holding company that is
             incorporated or organized under the laws of a country other
             than the United States and that has shareholders' equity in
             excess of $100 million in U.S. currency (or a foreign
             currency equivalent thereof)(iii) a banking institution or
             trust company incorporated or organized under the laws of a
             country other than the United States or a majority owned
             direct or indirect subsidiary of a qualified U.S. bank or
             bank holding company that is incorporated or organized under
             the laws of a country other than the United States which has
             such other qualifications as shall be specified in
             Instructions and approved by the Bank; or (iv) any other 









          PAGE 21
             entity that shall have been so qualified by exemptive order,
             rule or other appropriate action of the SEC; and

             (c)  "eligible foreign securities depository" shall mean a
             securities depository or clearing agency, incorporated or
             organized under the laws of a country other than the United
             States, which operates (i) the central system for handling
             securities or equivalent book-entries in that country, or
             (ii) a transnational system for the central handling of
             securities or equivalent book-entries.

             The Customer represents that its Board of Directors has
          approved each of the Subcustodians listed in Schedule B to this
          Agreement and the terms of the subcustody agreements between the
          Bank and each Subcustodian, which are attached as Exhibits I
          through       of Schedule B, and further represents that its
          Board has determined that the use of each Subcustodian and the
          terms of each subcustody agreement are consistent with the best
          interests of the Fund(s) and its (their) shareholders.  The Bank
          will supply the Customer with any amendment to Schedule B for
          approval.  As requested by the Bank, the Customer will supply the
          Bank with certified copies of its Board of Directors
          resolution(s) with respect to the foregoing prior to placing
          Assets with any Subcustodian so approved.

             Section 11.  Instructions.

             Add the following language to the end of Section 11:

             Deposit Account Payments and Custody Account Transactions
             made pursuant to Section 5 and 6 of this Agreement may be
             made only for the purposes listed below.  Instructions must
             specify the purpose for which any transaction is to be made
             and Customer shall be solely responsible to assure that
             Instructions are in accord with any limitations or
             restrictions applicable to the Customer by law or as may be
             set forth in its prospectus.

             (a)  In connection with the purchase or sale of Securities at
             prices as confirmed by Instructions;

             (b)  When Securities are called, redeemed or retired, or
             otherwise become payable;

             (c)  In exchange for or upon conversion into other securities
             alone or other securities and cash pursuant to any plan or
             merger, consolidation, reorganization, recapitalization or
             readjustment;

             (d)  Upon conversion of Securities pursuant to their terms
             into other securities;

             (e)  Upon exercise of subscription, purchase or other similar
             rights represented by Securities;

             (f)  For the payment of interest, taxes, management or
             supervisory fees, distributions or operating expenses;








          PAGE 22
             (g)  In connection with any borrowings by the Customer
             requiring a pledge of Securities, but only against receipt of
             amounts borrowed;

             (h)  In connection with any loans, but only against receipt
             of adequate collateral as specified in Instructions which
             shall reflect any restrictions applicable to the Customer;

             (i)  For the purpose of redeeming shares of the capital stock
             of the Customer and the delivery to, or the crediting to the
             account of, the Bank, its Subcustodian or the Customer's
             transfer agent, such shares to be purchased or redeemed;

             (j)  For the purpose of redeeming in kind shares of the
             Customer against delivery to the Bank, its Subcustodian or
             the Customer's transfer agent of such shares to be so
             redeemed;

             (k)  For delivery in accordance with the provisions of any
             agreement among the Customer, the Bank and a broker-dealer
             registered under the Securities Exchange Act of 1934 (the
             "Exchange Act") and a member of The National Association of
             Securities Dealers, Inc. ("NASD"), relating to compliance
             with the rules of The Options Clearing Corporation and of any
             registered national securities exchange, or of any similar
             organization or organizations, regarding escrow or other
             arrangements in connection with transactions by the Customer;

             (l)  For release of Securities to designated brokers under
             covered call options, provided, however, that such Securities
             shall be released only upon payment to the Bank of monies for
             the premium due and a receipt for the Securities which are to
             be held in escrow.  Upon exercise of the option, or at
             expiration, the Bank will receive from brokers the Securities
             previously deposited.  The Bank will act strictly in
             accordance with Instructions in the delivery of Securities to
             be held in escrow and will have no responsibility or
             liability for any such Securities which are not returned
             promptly when due other than to make proper request for such
             return;

             (m)  For spot or forward foreign exchange transactions to
             facilitate security trading, receipt of income from
             Securities or related transactions;

             (n)  For other proper purposes as may be specified in
             Instructions issued by an officer of the Customer which shall
             include a statement of the purpose for which the delivery or
             payment is to be made, the amount of the payment or specific
             Securities to be delivered, the name of the person or persons
             to whom delivery or payment is to be made, and a
             certification that the purpose is a proper purpose under the
             instruments governing the Customer; and

             (o)  Upon the termination of this Agreement as set forth in
             Section 14(i).









          PAGE 23
             Section 12.  Standard of Care; Liabilities.

             Add the following subsection (c) to Section 12:

             (c)  The Bank hereby warrants to the Customer that in its
             opinion, after due inquiry, the established procedures to be
             followed by each of its branches, each branch of a qualified
             U.S. bank, each eligible foreign custodian and each eligible
             foreign securities depository holding the Customer's
             Securities pursuant to this Agreement afford protection for
             such Securities at least equal to that afforded by the Bank's
             established procedures with respect to similar securities
             held by the Bank and its securities depositories in New York.

             Section 14.  Access to Records.

             Add the following language to the end of Section 14(c):

             Upon reasonable request from the Customer, the Bank shall
             furnish the Customer such reports (or portions thereof) of
             the Bank's system of internal accounting controls applicable
             to the Bank's duties under this Agreement.  The Bank shall
             endeavor to obtain and furnish the Customer with such similar
             reports as it may reasonably request with respect to each
             Subcustodian and securities depository holding the Customer's
             assets.

                                   GLOBAL CUSTODY AGREEMENT


                                   WITH                                    



                                   DATE                                    



                          SPECIAL TERMS AND CONDITIONS RIDER


























          PAGE 24
          January, 1994            Schedule B


                              SUB-CUSTODIANS EMPLOYED BY

                THE CHASE MANHATTAN BANK, N.A. LONDON, GLOBAL CUSTODY


          COUNTRY        SUB-CUSTODIAN                   CORRESPONDENT BANK

          ARGENTINA      The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         Main Branch                     N.A. Buenos Aires
                         25 De Mayo 130/140
                         Buenos Aires
                         ARGENTINA

          AUSTRALIA      The Chase Manhattan Bank,       The Chase
                          Australia Limited              Manhattan Bank
                         36th Floor                      Australia Limited
                         World Trade Centre              Sydney
                         Jamison Street
                         Sydney
                         New South Wales 2000
                         AUSTRALIA

          AUSTRIA        Creditanstalt - Bankvereln      Credit Lyonnais
                         Schottengasse 6                 Vienna
                         A - 1011, Vienna
                         AUSTRIA

          BANGLADESH     Standard Chartered Bank         Standard Chartered
                         18-20 Motijheel C.A.            Bank Dhaka
                         Box 536,
                         Dhaka-1000
                         BANGLADESH

          BELGIUM        Generale Bank                   Credit Lyonnais
                         3 Montagne Du Parc              Bank Brussels
                         1000 Bruxelles
                         BELGIUM

          BOTSWANA       Standard Chartered Bank         Standard Chartered
                          Botswana Ltd.                  Bank Botswana Ltd.
                         4th Floor Commerce House        Gaborone
                         The Mall
                         Gaborone
                         BOTSWANA

          BRAZIL         Banco Chase Manhattan, S.A.     Banco Chase
                         Chase Manhattan Center          Manhattan S.A.
                         Rua Verbo Divino, 1400          Sao Paulo
                         Sao Paulo, SP 04719-002
                         BRAZIL











          PAGE 25
          CANADA         The Royal Bank of Canada        Toronto Dominion
                         Royal Bank Plaza                Bank
                         Toronto                         Toronto
                         Ontario  M5J 2J5
                         CANADA

                         Canada Trust                    Toronto Dominion
                         Canada Trust Tower              Bank
                         BCE Place                       Toronto
                         161 Bay at Front
                         Toronto
                         Ontario M5J 2T2
                         CANADA

          CHILE          The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         Agustinas 1235                  N.A.
                         Casilla 9192                    Santiago
                         Santiago
                         CHILE

          COLOMBIA       Cititrust Colombia S.A.         Cititrust Colombia
                          Sociedad Fiduciaria            S.A. Sociedad
                         Av. Jimenez No 8-89             Fiduciaria
                         Santafe de Bogota, DC           Santafe de Bogota
                         COLOMBIA

          CZECH          Ceskoslovenska Obchodni         Ceskoslovenska
          REPUBLC        Banka, A.S.                     Obchodni Banka,
                         Na Prikoope 14                  A.S.
                         115 20 Praha 1                  Praha
                         CZECH REPUBLIC

          DENMARK        Den Danske Bank                 Den Danske Bak
                         2 Holmens Kanala DK 1091        Copenhagen
                         Copenhagen
                         DENMARK

          EUROBONDS      Cedel S.A.                      ECU:Lloyds Bank
                         67 Boulevard Grande Duchesse    PLC
                         Charlotte                       International
                         LUXEMBOURG                      Banking  Dividion
                         A/c The Chase Manhattan         London
                         Bank, N.A.                      For all other
                         London                          currencies: see
                         A/c No. 17817                   relevant country

          EURO CDS       First Chicago Clearing          ECU:Lloyds Bank
                         Centre                          PLC
                         27 Leadenhall Street            Banking Division
                         London EC3A 1AA                 London
                         UNITED KINGDOM                  For all other
                                                         currencies: see
                                                         relevant country











          PAGE 26
          FINLAND        Kansallis-Osake-Pankki          Kanasallis-Osake-
                         Aleksanterinkatu 42             Pankki
                         00100 Helsinki 10
                         FINLAND

          FRANCE         Banque Paribas                  Societe Generale
                         Ref 256                         Paris
                         BP 141
                         3, Rue D'Antin
                         75078 Paris
                         Cedex 02
                         FRANCE

          GERMANY        Chase Bank A.G.                 Chase Bank A.G.
                         Alexanderstrasse 59             Frankfurt
                         Postfach 90 01 09
                         60441 Frankfurt/Main
                         GERMANY

          GREECE         National Bank of Greece S.A.    National Bank of
                         38 Stadiou Street               Greece S.A. Athens
                         Athens                          A/c Chase
                         GREECE                          Manhattan Bank,
                                                         N.A., London
                                                         A/c No.
                                                         040/7/921578-68

          HONG KONG      The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         40/F One Exchange Square        N.A.
                         8, Connaught Place              Hong Kong
                         Central, Hong Kong
                         HONG KONG

          HUNGARY        Citibank Budapest Rt.           Citibank Budapest
                         Vaci Utca 19-21                 Rt.
                         1052 Budapest V                 Budapest
                         HUNGARY

          INDIA          The Hongkong and Shanghai       The Hongkong and
                          Banking Corporation Limited    Shanghai
                         52/60 Mahatma Gandhi Road       Banking
                         Bombay 400 001                  Corporation
                         INDIA                           Limited
                                                         Bombay

          INDONESIA      The Hongkong and Shanghai       The Chase
                          Banking Corporation Limited    Manhattan Bank,
                         World Trade Center              N.A.
                         J1. Jend Sudirman Kav. 29-31    Jakarta
                         Jakarta 10023
                         INDONESIA













          PAGE 27
          IRELAND        Bank of Ireland                 Allied Irish Bank
                         International Financial         Dublin
                         Services Centre
                         1 Hargourmaster Place
                         Dublin 1
                         IRELAND

          ISRAEL         Bank Leumi Le-Israel B.M.       Bank Leumi Le-
                         19 Herzi Street                 Israel B.M.
                         65136 Tel Aviv                  Tel Aviv
                         ISRAEL

          ITALY          The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         Piazza Meda 1                   N.A.
                         20121 Milan                     Milan
                         ITALY

          JAPAN          The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         1-3 Marunouchi 1-Chome          N.A.
                         Chiyoda-Ku                      Tokyo
                         Tokyo 100
                         JAPAN

          JORDAN         Arab Bank Limited               Arab Bank Limited
                         P.O. Box 950544-5               Amman
                         Amman
                         Shmeisani
                         JORDAN

          LUXEMBOURG     Banque Generale du              Banque Generale du
                         Luxembourg S.A.                 Luxembourg S.A.
                         27 Avenue Monterey              Luxembourg
                         LUXEMBOURG

          MALAYSIA       The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         Pernas International            N.A.
                         Jalan Sultan Ismail             Kuala Lumpur
                         50250, Kuala Lumpur
                         MALAYSIA

          MEXICO         The Chase Manhattan Bank,       No correspondent
          (Equities)     N.A.                            Bank
                         Hamburgo 213, Piso 7
                         06660 Mexico D.F.
                         MEXICO

          (Government    Banco Nacional de Mexico,       Banque Commerciale
          Bonds)         Avenida Juarez No. 104 - 11     du Maroc
                         Piso                            Casablanca
                         06040 Mexico D.F.
                         MEXICO











          PAGE 28

          NETHERLANDS    ABN AMRO N.V.                   Credit Lyonnais
                         Securities Centre               Bank Nederland
                         P.O. Box 3200                   N.V.
                         4800 De Breda                   Rotterdam
                         NETHERLANDS

          NEW ZEALAND    National Nominees Limited       National Bank of
                         Level 2 BNZ Tower               New Zealand
                         125 Queen Street                Wellington
                         Auckland
                         NEW ZEALAND

          NORWAY         Den Norske Bank                 Den Norske Bank
                         Kirkegaten 21                   Oslo
                         Oslo 1
                         NORWAY

          PAKISTAN       Citibank N.A.                   Citibank N.A.
                         State Life Building No.1        Karachi
                         I.I. Chundrigar Road
                         Karachi
                         PAKISTAN

          PERU           Citibank, N.A.                  Citibank N.A.
                         Camino Real 457                 Lima
                         CC Torre Real - 5th Floor
                         San Isidro, Lima 27
                         PERU

          PHILIPPINES    The Hongkong and Shanghai       The Hongkong and
                          Banking Corporation Limited    Shaghai Banking
                         Hong Kong Bank Centre 3/F       Corporation
                         San Miguel Avenue               Limited
                         Ortigas Commercial Centre       Manila
                         Pasig Metro Manila
                         PHILIPPINES

          POLAND         Bank Polska Kasa Opieki S.A.    Bank Potska Kasa
                         6/12 Nowy Swiat Str             Opieki S.A.
                         00-920 Warsaw                   Warsaw
                         POLAND

          PORTUGAL       Banco Espirito Santo &          Banco Pinto &
                         Comercial de Lisboa             Sotto Mayor
                         Servico de Gestaode Titulos     Avenida Fontes
                         R. Mouzinho da Silvelra, 36     Pereira de Melo
                         r/c                             1000 Lisbon
                         1200 Lisbon
                         PORTUGAL















          PAGE 29
          SHANGHAI       The Hongkong and Shanghai       The Chase
          (CHINA)         Banking Corporation Limited    Manhattan Bank,
                         Shanghai Branch                 N.A.
                         Corporate Banking Centre        Hong Kong
                         Unit 504, 5/F Shanghai
                         Centre
                         1376 Hanjing Xi Lu
                         Shanghai
                         THE PEOPLE'S REPUBLIC OF
                         CHINA

          SCHENZHEN      The Hongkong and Shanghai       The Chase
          (CHINA)         Banking Corporation Limited    Manhattan Bank,
                         1st Floor                       N.A.
                         Central Plaza Hotel             Hong Kong
                         No. 1 Chun Feng Lu
                         Shenzhen
                         THE PEOPLE'S REPUBLIC OF
                         CHINA

          SINGAPORE      The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         Shell Tower                     N.A.
                         50 Raffles Place                Singapore
                         Singapore 0104
                         SINGAPORE

          SOUTH KOREA    The Hongkong & Shanghai         The Hongkong &
                          Banking Corporation Limited    Shanghai Banking
                         6/F Kyobo Building              Corporation
                         #1 Chongro, 1-ka Chongro-Ku,    Limited
                         Seoul                           Seoul
                         SOUGH KOREA

          SPAIN          The Chase Manhattan Bank,       Banco Zaragozano,
                         N.A.                            S.A.
                         Calle Peonias 2                 Madrid
                         7th Floor
                         La Piovera
                         28042 Madrid
                         SPAIN

          URUGUAY        The First National Bank of      The First National
                         Boston                          Bank of Boston
                         Zabala 1463                     Montevideo
                         Montevideo
                         URUGUAY

          U.S.A          The Chase Manhattan Bank,       The Chase
                         N.A.                            Manhattan Bank,
                         1 Chase Manhattan Plaza         N.A.
                         New York                        New York
                         NY 10081
                         U.S.A.











          PAGE 30
          VENEZUELA      Citibank N.A.                   Citibank N.A.
                         Carmelitas a Altagracia         Caracas
                         Edificio Citibank
                         Caracas 1010
                         VENEZUELA




























































          PAGE 31
                                 AMENDMENT AGREEMENT

             AMENDMENT AGREEMENT, dated as of April 18, 1994 (the
          "Amendment Agreement") to the Global Custody Agreement, effective
          January 3, 1994 (the "Custody Agreement") by and between each of
          the Entities listed in Attachment A hereto, separately and
          individually (each such entity referred to hereinafter as the
          "Customer") and THE CHASE MANHATTAN BANK, N.A. (the "Bank"). 
          Terms defined in the Custody Agreement are used herein as therein
          defined.

                                     WITNESSETH:

             WHEREAS, the Customer wishes to appoint the Bank as its
          global custodian and the bank wishes to accept such appointment
          pursuant to the terms of the Custody Agreement;

             NOW, THEREFORE, the parties hereto agree as follows:

             1.  Amendment.  Section I of Schedule A of the Custody
                 Agreement ("Schedule A") shall be amended to add each
                 Customer listed in Attachment A hereto.  The revised
                 Schedule A incorporating these changes in the form
                 attached hereto as Attachment B shall supersede the
                 existing Schedule A in its entirety.

             2.  Agreement.  The Customer agrees to be bound in all
                 respects by all the terms and conditions of the Custody
                 Agreement and shall be fully liable thereunder as a
                 "Customer" as defined in the Custody Agreement.

             3.  Confirmation of Agreement.  Except as amended hereby, the
                 Custody Agreement is in full force and effect and as so
                 amended is hereby ratified, approved and confirmed by the
                 Customer and the Bank in all respects.

             4.  Governing Law.  This Amendment Agreement shall be
                 construed in accordance with and governed by the law of
                 the State of New York without regard to its conflict of
                 law principles.

























          PAGE 32
             IN WITNESS WHEREOF, the parties have executed this Amendment
          Agreement as of the day and year first above written.

                                   THE CHASE MANHATTAN BANK, N.A.

                                        /s/Alan P. Naughton
                                   By:________________________________
                                        Alan P. Naughton
                                        Vice President

                                   EACH OF THE CUSTOMERS LISTED IN
                                   ATTACHMENT A HERETO, SEPARATELY AND
                                   INDIVIDUALLY

                                        /s/Carmen F. Deyesu
                                   By:  ______________________________
                                        Carmen F. Deyesu
                                        Treasurer















































          PAGE 33
                                                               Attachment A



                                  LIST OF CUSTOMERS



          T. Rowe Price International Series, Inc. on behalf of the
             T. Rowe Price International Stock Portfolio


          T. Rowe Price Equity Series, Inc. on behalf of the
             T. Rowe Price Equity Income Portfolio
             T. Rowe Price New America Growth Portfolio


          T. Rowe Price New America Growth Fund, Inc.


          T. Rowe Price Income Series, Inc. on behalf of
             T. Rowe Price Limited-Term Bond Portfolio











































          PAGE 34
                                                               Attachment B

                                                                 Schedule A

                                                                Page 1 of 2


                   LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO
                            GLOBAL CUSTODY AGREEMENT WITH
                            THE CHASE MANHATTAN BANK, N.A.
                                DATED JANUARY 3, 1993


                                                 APPLICABLE RIDERS TO
                      CUSTOMER                 GLOBAL CUSTODY AGREEMENT

          I.   INVESTMENT                       The Mutual Fund Rider is
               COMPANIES/PORTFOLIOS             applicable to all Customers
               REGISTERED UNDER THE             listed under Section I
               INVESTMENT COMPANY ACT OF 1940   of this Schedule A.













































          PAGE 35
               Equity Funds

               T. Rowe Price Balanced Fund, Inc.
               T. Rowe Price Blue Chip Growth Fund, Inc.
               T. Rowe Price Capital Appreciation Fund
               T. Rowe Price Dividend Growth Fund, Inc.
               T. Rowe Price Equity Income Fund
               T. Rowe Price Growth & Income Fund, Inc.
               T. Rowe Price Growth Stock Fund, Inc.
               Institutional International Funds, Inc. on behalf of:
                   Foreign Equity Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price European Stock Fund
                   T. Rowe Price International Discovery Fund
                   T. Rowe Price International Stock Fund
                   T. Rowe Price Japan Fund
                   T. Rowe Price Latin America Fund
                   T. Rowe Price New Asia Fund
               T. Rowe Price International Series, Inc., on behalf of:
                   T. Rowe Price International Stock Portfolio
               T. Rowe Price Mid-Cap Growth Fund, Inc.
               T. Rowe Price New Era Fund, Inc.
               T. Rowe Price New Horizons Fund, Inc.
               T. Rowe Price OTC Fund, Inc. on behalf of:
                   T. Rowe Price OTC Fund
               T. Rowe Price Science & Technology Fund, Inc.
               T. Rowe Price Small-Cap Value Fund, Inc.
               CUNA Mutual Funds, Inc. on behalf of:
                   CUNA Mutual Cornerstone Fund
               T. Rowe Price Equity Series, Inc. on behalf of:
                   T. Rowe Price Equity Income Portfolio
                   T. Rowe Price New America Growth Portfolio
               T. Rowe Price New America Growth Fund, Inc.

               Income Funds

               T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
               T. Rowe Price High Yield Fund, Inc.
               T. Rowe Price New Income Fund, Inc.
               T. Rowe Price Short-Term Bond Fund, Inc.
               T. Rowe Price Summit Funds, Inc. on behalf of:
                   T. Rowe Price Summit Limited-Term Bond Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price Global Government Income Fund
                   T. Rowe Price International Bond Fund
                   T. Rowe Price Short-Term Global Income Fund
               T. Rowe Price Income Series, Inc. on behalf of:
                   T. Rowe Price Limited-Term Bond Portfolio

          II.  ACCOUNTS SUBJECT TO ERISA        The ERISA Rider is
                                                applicable to all Customers
               T. Rowe Price Trust Company,     under Section II of this
                  as Trustee for the Johnson    Schedule A.
                  Matthey Salaried Employee
                  Savings Plan










          PAGE 36
               Common Trust Funds

               T. Rowe Price Trust company,
               as Trustee for the International
               Common Trust Fund on behalf of
               the Underlying Trusts:

                  Foreign Discovery Trust
                  Foreign Discovery Trust-Augment
                  Pacific Discovery Trust
                  European Discovery Trust
                  Japan Discovery Trust
                  Latin American Discovery Trust

               New York City International Common Trust Fund

          III. OTHER                            No Riders are applicable to
                                                the Customer listed under
               RPFI International               Section III of this
                  Partners, L.P.                Schedule A.













































          PAGE 37
                                 AMENDMENT AGREEMENT

               AMENDMENT AGREEMENT, dated as of August 15, 1994 (the
          "Amendment Agreement") to the Global Custody Agreement, effective
          January 3, 1994, as amended (the "Custody Agreement") by and
          between each of the Entities listed in Attachment A hereto,
          separately and individually (each such entity referred to
          hereinafter as the "Customer") and THE CHASE MANHATTAN BANK, N.A.
          (the "Bank").  Terms defined in the Custody Agreement are used
          herein as therein defined.

                                     WITNESSETH:

               WHEREAS, the Customer wishes to appoint the Bank as its
          global custodian and the Bank wishes to accept such appointment
          pursuant to the terms of the Custody Agreement;

               NOW, THEREFORE, the parties hereto agree as follows:

               1.   Amendment.  Section I of Schedule A of the Custody
          Agreement ("Schedule A") shall be amended to add each Customer
          listed in Attachment A hereto.  The revised Schedule A
          incorporating these changes in the form attached hereto as
          Attachment B shall supersede the existing Schedule A in its
          entirety.

               2.   Agreement.  The Customer agrees to be bound in all
          respects by all the terms and conditions of the Custody Agreement
          and shall be fully liable thereunder as a "Customer" as defined
          in the Custody Agreement.

               3.   Confirmation of Agreement.  Except as amended hereby,
          the Custody Agreement is in full force and effect and as so
          amended is hereby ratified, approved and confirmed by the
          Customer and the Bank in all respects.

               4.   Governing Law.  This Amendment Agreement shall be
          construed in accordance with and governed by the law of the State
          of New York without regard to its conflict of law principles.


























          PAGE 38
               IN WITNESS WHEREOF, the parties have executed this Amendment
          Agreement as of the day and year first above written.

                                   THE CHASE MANHATTAN BANK, N.A.

                                        /s/Alan P. Naughton
                                   By:_________________________________
                                        Alan P. Naughton
                                        Vice President

                                   EACH OF THE CUSTOMERS LISTED IN
                                   ATTACHMENT A HERETO, SEPARATELY AND
                                   INDIVIDUALLY

                                        /s/Carmen F. Deyesu
                                   By:_________________________________
                                        Carmen F. Deyesu
                                        Treasurer















































          PAGE 39
                                                               Attachment A



                                  LIST OF CUSTOMERS


          T. Rowe Price Equity Series, Inc. on behalf of the
             T. Rowe Price Personal Strategy Balanced Portfolio


          T. Rowe Price Personal Strategy Funds, Inc. on behalf of
             T. Rowe Price Personal Strategy Balanced Fund
             T. Rowe Price Personal Strategy Growth Fund
             T. Rowe Price Personal Strategy Income Fund


















































          PAGE 40
                                                               Attachment B

                                                                 Schedule A

                                                                Page 1 of 2


                   LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO
                            GLOBAL CUSTODY AGREEMENT WITH
                            THE CHASE MANHATTAN BANK, N.A.
                                DATED JANUARY 3, 1993


                                                 APPLICABLE RIDERS TO
                      CUSTOMER                 GLOBAL CUSTODY AGREEMENT

          I.   INVESTMENT                       The Mutual Fund Rider is
               COMPANIES/PORTFOLIOS             applicable to all Customers
               REGISTERED UNDER THE             listed under Section I
               INVESTMENT COMPANY ACT OF 1940   of this Schedule A.

               Equity Funds

               T. Rowe Price Balanced Fund, Inc.
               T. Rowe Price Blue Chip Growth Fund, Inc.
               T. Rowe Price Capital Appreciation Fund
               T. Rowe Price Dividend Growth Fund, Inc.
               T. Rowe Price Equity Income Fund
               T. Rowe Price Growth & Income Fund, Inc.
               T. Rowe Price Growth Stock Fund, Inc.
               Institutional International Funds, Inc. on behalf of:
                   Foreign Equity Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price European Stock Fund
                   T. Rowe Price International Discovery Fund
                   T. Rowe Price International Stock Fund
                   T. Rowe Price Japan Fund
                   T. Rowe Price Latin America Fund
                   T. Rowe Price New Asia Fund
               T. Rowe Price International Series, Inc., on behalf of:
                   T. Rowe Price International Stock Portfolio
               T. Rowe Price Mid-Cap Growth Fund, Inc.
               T. Rowe Price New Era Fund, Inc.
               T. Rowe Price New Horizons Fund, Inc.
               T. Rowe Price OTC Fund, Inc. on behalf of:
                   T. Rowe Price OTC Fund
               T. Rowe Price Science & Technology Fund, Inc.
               T. Rowe Price Small-Cap Value Fund, Inc.
               CUNA Mutual Funds, Inc. on behalf of:
                   CUNA Mutual Cornerstone Fund
               T. Rowe Price Equity Series, Inc. on behalf of:
                   T. Rowe Price Equity Income Portfolio
                   T. Rowe Price New America Growth Portfolio
                   T. Rowe Price Personal Strategy Balanced Portfolio
               T. Rowe Price New America Growth Fund, Inc.










          PAGE 41
               Income Funds

               T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
               T. Rowe Price High Yield Fund, Inc.
               T. Rowe Price New Income Fund, Inc.
               T. Rowe Price Short-Term Bond Fund, Inc.
               T. Rowe Price Summit Funds, Inc. on behalf of:
                   T. Rowe Price Summit Limited-Term Bond Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price Global Government Income Fund
                   T. Rowe Price International Bond Fund
                   T. Rowe Price Short-Term Global Income Fund
               T. Rowe Price Income Series, Inc. on behalf of:
                   T. Rowe Price Limited-Term Bond Portfolio
               T. Rowe Price Personal Strategy Funds, Inc. on behalf of:
                   T. Rowe Price Personal Strategy Balanced Fund
                   T. Rowe Price Personal Strategy Growth Fund
                   T. Rowe Price Personal Strategy Income Fund


          II.  ACCOUNTS SUBJECT TO ERISA        The ERISA Rider is
                                                applicable to all Customers
               T. Rowe Price Trust Company,     under Section II of this
                  as Trustee for the Johnson    Schedule A.
                  Matthey Salaried Employee
                  Savings Plan

               Common Trust Funds

               T. Rowe Price Trust company,
               as Trustee for the International
               Common Trust Fund on behalf of
               the Underlying Trusts:

                  Foreign Discovery Trust
                  Foreign Discovery Trust-Augment
                  Pacific Discovery Trust
                  European Discovery Trust
                  Japan Discovery Trust
                  Latin American Discovery Trust

               New York City International Common Trust Fund

          III. OTHER                            No Riders are applicable to
                                                the Customer listed under
               RPFI International               Section III of this
                  Partners, L.P.                Schedule A.


















          PAGE 42
                                 AMENDMENT AGREEMENT

               AMENDMENT AGREEMENT, dated as of November 28, 1994 (the
          "Amendment Agreement") to the Global Custody Agreement, effective
          January 3, 1994, as amended (the "Custody Agreement") by and
          between each of the Entities listed in Attachment A hereto,
          separately and individually (each such entity referred to
          hereinafter as the "Customer") and THE CHASE MANHATTAN BANK, N.A.
          (the "Bank").  Terms defined in the Custody Agreement are used
          herein as therein defined.

                                     WITNESSETH:

               WHEREAS, the Customer wishes to appoint the Bank as its
          global custodian and the Bank wishes to accept such appointment
          pursuant to the terms of the Custody Agreement;

               NOW, THEREFORE, the parties hereto agree as follows:

               1.   Amendment.  Section I of Schedule A of the Custody
          Agreement ("Schedule A") shall be amended to add each Customer
          listed in Attachment A hereto.  The revised Schedule A
          incorporating these changes in the form attached hereto as
          Attachment B shall supersede the existing Schedule A in its
          entirety.

               2.   Agreement.  The Customer agrees to be bound in all
          respects by all the terms and conditions of the Custody Agreement
          and shall be fully liable thereunder as a "Customer" as defined
          in the Custody Agreement.

               3.   Confirmation of Agreement.  Except as amended hereby,
          the Custody Agreement is in full force and effect and as so
          amended is hereby ratified, approved and confirmed by the
          Customer and the Bank in all respects.

               4.   Governing Law.  This Amendment Agreement shall be
          construed in accordance with and governed by the law of the State
          of New York without regard to its conflict of law principles.


























          PAGE 43
               IN WITNESS WHEREOF, the parties have executed this Amendment
          Agreement as of the day and year first above written.

                                   THE CHASE MANHATTAN BANK, N.A.

                                        /s/Alan P. Naughton
                                   By:_________________________________
                                        Alan P. Naughton
                                        Vice President

                                   EACH OF THE CUSTOMERS LISTED IN
                                   ATTACHMENT A HERETO, SEPARATELY AND
                                   INDIVIDUALLY

                                        /s/Carmen F. Deyesu
                                   By:_________________________________
                                        Carmen F. Deyesu
                                        Treasurer















































          PAGE 44
                                                               Attachment A



                                  LIST OF CUSTOMERS


          T. Rowe Price Value Fund, Inc.

          T. Rowe Price Capital Opportunity Fund, Inc.

          T. Rowe Price International Funds, Inc. on behalf of:
             T. Rowe Price Emerging Markets Bond Fund




















































          PAGE 45
                                                               Attachment B

                                                                 Schedule A

                                                                Page 1 of 2


                   LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO
                            GLOBAL CUSTODY AGREEMENT WITH
                            THE CHASE MANHATTAN BANK, N.A.
                                DATED JANUARY 3, 1993


                                                 APPLICABLE RIDERS TO
                      CUSTOMER                 GLOBAL CUSTODY AGREEMENT

          I.   INVESTMENT                       The Mutual Fund Rider is
               COMPANIES/PORTFOLIOS             applicable to all Customers
               REGISTERED UNDER THE             listed under Section I
               INVESTMENT COMPANY ACT OF 1940   of this Schedule A.

               Equity Funds

               T. Rowe Price Balanced Fund, Inc.
               T. Rowe Price Blue Chip Growth Fund, Inc.
               T. Rowe Price Capital Appreciation Fund
               T. Rowe Price Capital Opportunity Fund, Inc.
               T. Rowe Price Dividend Growth Fund, Inc.
               T. Rowe Price Equity Income Fund
               T. Rowe Price Growth & Income Fund, Inc.
               T. Rowe Price Growth Stock Fund, Inc.
               Institutional International Funds, Inc. on behalf of:
                   Foreign Equity Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price European Stock Fund
                   T. Rowe Price International Discovery Fund
                   T. Rowe Price International Stock Fund
                   T. Rowe Price Japan Fund
                   T. Rowe Price Latin America Fund
                   T. Rowe Price New Asia Fund
               T. Rowe Price International Series, Inc., on behalf of:
                   T. Rowe Price International Stock Portfolio
               T. Rowe Price Mid-Cap Growth Fund, Inc.
               T. Rowe Price New Era Fund, Inc.
               T. Rowe Price New Horizons Fund, Inc.
               T. Rowe Price OTC Fund, Inc. on behalf of:
                   T. Rowe Price OTC Fund
               T. Rowe Price Science & Technology Fund, Inc.
               T. Rowe Price Small-Cap Value Fund, Inc.
               CUNA Mutual Funds, Inc. on behalf of:
                   CUNA Mutual Cornerstone Fund
               T. Rowe Price Equity Series, Inc. on behalf of:
                   T. Rowe Price Equity Income Portfolio
                   T. Rowe Price New America Growth Portfolio
                   T. Rowe Price Personal Strategy Balanced Portfolio
               T. Rowe Price New America Growth Fund, Inc.
               T. Rowe Price Value Fund, Inc.








          PAGE 46
               Income Funds

               T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
               T. Rowe Price High Yield Fund, Inc.
               T. Rowe Price New Income Fund, Inc.
               T. Rowe Price Short-Term Bond Fund, Inc.
               T. Rowe Price Summit Funds, Inc. on behalf of:
                   T. Rowe Price Summit Limited-Term Bond Fund
               T. Rowe Price International Funds, Inc. on behalf of:
                   T. Rowe Price Global Government Income Fund
                   T. Rowe Price International Bond Fund
                   T. Rowe Price Short-Term Global Income Fund
                   T. Rowe Price Emerging Markets Bond Fund
               T. Rowe Price Income Series, Inc. on behalf of:
                   T. Rowe Price Limited-Term Bond Portfolio
               T. Rowe Price Personal Strategy Funds, Inc. on behalf of:
                   T. Rowe Price Personal Strategy Balanced Fund
                   T. Rowe Price Personal Strategy Growth Fund
                   T. Rowe Price Personal Strategy Income Fund


          II.  ACCOUNTS SUBJECT TO ERISA        The ERISA Rider is
                                                applicable to all Customers
               T. Rowe Price Trust Company,     under Section II of this
                  as Trustee for the Johnson    Schedule A.
                  Matthey Salaried Employee
                  Savings Plan

               Common Trust Funds

               T. Rowe Price Trust company,
               as Trustee for the International
               Common Trust Fund on behalf of
               the Underlying Trusts:

                  Foreign Discovery Trust
                  Foreign Discovery Trust-Augment
                  Pacific Discovery Trust
                  European Discovery Trust
                  Japan Discovery Trust
                  Latin American Discovery Trust

               New York City International Common Trust Fund

          III. OTHER                            No Riders are applicable to
                                                the Customer listed under
               RPFI International               Section III of this
                  Partners, L.P.                Schedule A.
















          
 The Transfer Agency and Service Agreement between T. Rowe
          Price Services, Inc. and T. Rowe Price Funds, dated January 1,
          1995, as amended, should be inserted here.
             






          PAGE 1
                        TRANSFER AGENCY AND SERVICE AGREEMENT

                                       between

                             T. ROWE PRICE SERVICES, INC.

                                         and

                     EACH OF THE PARTIES INDICATED ON APPENDIX A
























































          PAGE 2
                                  TABLE OF CONTENTS

                                                                  Page
          Article A Terms of Appointment  . . . . . . . . . . . . . 2

          Article B Duties of Price Services  . . . . . . . . . . . 2
                    1.   Receipt of Orders/Payments . . . . . . . . 3

                    2.   Written Redemptions  . . . . . . . . . . . 4
                    3.   Transfers  . . . . . . . . . . . . . . . . 5

                    4.   Confirmations  . . . . . . . . . . . . . . 6
                    5.   Returned Checks and ACH Debits . . . . . . 6

                    6.   Redemptions of Shares under Ten Day Hold . 6
                    7.   Dividends, Distributions and Other
                         Corporate Actions  . . . . . . . . . . . . 8

                    8.   Unclaimed Payments and Certificates  . . . 9
                    9.   Books and Records  . . . . . . . . . . . . 9

                    10.  Authorized Issued and Outstanding Shares  11
                    11.  Tax Information  . . . . . . . . . . . .  11

                    12.  Information to be Furnished to the Fund   12
                    13.  Correspondence . . . . . . . . . . . . .  12

                    14.  Lost or Stolen Securities  . . . . . . .  12
                    15.  Telephone Services . . . . . . . . . . .  12

                    16.  Proxies  . . . . . . . . . . . . . . . .  13
                    17.  Form N-SAR . . . . . . . . . . . . . . .  13

                    18.  Cooperation With Accountants . . . . . .  13
                    19.  Blue Sky . . . . . . . . . . . . . . . .  13

                    20.  Other Services . . . . . . . . . . . . .  14
                    21.  Fees and Out-of-Pocket Expenses  . . . .  14

          Article C Representations and Warranties of the Price
                    Services  . . . . . . . . . . . . . . . . . .  15
          Article D Representations and Warranties of the Fund  .  16

          Article E Standard of Care/Indemnification  . . . . . .  17
          Article F Dual Interests  . . . . . . . . . . . . . . .  19

          Article G Documentation . . . . . . . . . . . . . . . .  19


















          PAGE 3
          Article H References to Price Services  . . . . . . . .  20

          Article I Compliance with Governmental Rules and
                    Regulations . . . . . . . . . . . . . . . . .  21
          Article J Ownership of Software and Related Material  .  21

          Article K Quality Service Standards . . . . . . . . . .  21
          Article L As of Transactions  . . . . . . . . . . . . .  21

          Article M Term and Termination of Agreement . . . . . .  24
          Article N Notice  . . . . . . . . . . . . . . . . . . .  25

          Article O Assignment  . . . . . . . . . . . . . . . . .  25
          Article P Amendment/Interpretive Provisions . . . . . .  25

          Article Q Further Assurances  . . . . . . . . . . . . .  25
          Article R Maryland Law to Apply . . . . . . . . . . . .  26

          Article S Merger of Agreement . . . . . . . . . . . . .  26
          Article T Counterparts  . . . . . . . . . . . . . . . .  26

          Article U The Parties . . . . . . . . . . . . . . . . .  26
          Article V Directors, Trustees, Shareholders and
                    Massachusetts Business Trust  . . . . . . . .  26

          Article W Captions  . . . . . . . . . . . . . . . . . .  27







































          PAGE 4
                        TRANSFER AGENCY AND SERVICE AGREEMENT

               AGREEMENT made as of the first day of January, 1995, by and

          between T. ROWE PRICE SERVICES, INC., a Maryland corporation

          having its principal office and place of business at 100 East

          Pratt Street, Baltimore, Maryland 21202 ("Price Services"), and

          EACH FUND WHICH IS LISTED ON APPENDIX A (as such Appendix may be

          amended from time to time) and which evidences its agreement to

          be bound hereby by executing a copy of this Agreement (each such

          Fund individually hereinafter referred to as "the Fund", whose

          definition may be found in Article U); 

               WHEREAS, the Fund desires to appoint Price Services as its

          transfer agent, dividend disbursing agent and agent in connection

          with certain other activities, and Price Services desires to

          accept such appointment;

               WHEREAS, Price Services represents that it is registered

          with the Securities and Exchange Commission as a Transfer Agent

          under Section 17A of the Securities Exchange Act of 1934 ("'34

          Act") and will notify each Fund promptly if such registration is

          revoked or if any proceeding is commenced before the Securities

          and Exchange Commission which may lead to such revocation;

               WHEREAS, certain of the Funds are named investment options

          under various tax-sheltered retirement plans including, but not

          limited to, individual retirement accounts, simplified employee 




















          PAGE 5

          pension plans, deferred compensation plans, 403(b) plans, and

          profit sharing, thrift, and money purchase pension plans for

          self-employed individuals and professional partnerships and

          corporations, (collectively referred to as "Retirement Plans");

               WHEREAS, Price Services has the capability of providing

          special services, on behalf of the Funds, for the accounts of

          shareholders participating in these Retirement Plans ("Retirement

          Accounts"). 

               WHEREAS, Price Services may subcontract or jointly contract

          with other parties, on behalf of the Funds, including, but not

          limited to, DST, SRI, Moore Business Forms, Boston Financial Data

          Services, Inc., and The Analytical Sciences Corporation, to

          perform certain of the functions and services described herein

          including services to Retirement Plans and Retirement Accounts. 

          Price Services may also enter into, on behalf of the Funds,

          certain banking relationships to perform various banking services

          including, but not limited to, check deposits, check

          disbursements, automated clearing house transactions ("ACH") and

          wire transfers.  Subject to guidelines mutually agreed upon by

          the Funds and Price Services, excess balances, if any, resulting

          from these banking relationships will be invested and the income

          therefrom will be used to offset fees which would otherwise be

          charged to the Funds under this Agreement.  



















          PAGE 6

               NOW, THEREFORE, in consideration of the mutual covenants

          herein contained, the parties hereto agree as follows:

          A.   Terms of Appointment

               Subject to the terms and conditions set forth in this

          Agreement, the Fund hereby employs and appoints Price Services to

          act, and Price Services agrees to act, as the Fund's transfer

          agent, dividend disbursing agent and agent in connection with: 

          (1) the Fund's authorized and issued shares of its common stock

          or shares of beneficial interest (all such stock and shares to be

          referred to as "Shares"); (2) any accumulation, open-account or

          similar plans provided to the shareholders of the Fund

          ("Shareholders"), including, without limitation, any periodic

          investment plan or periodic withdrawal program; and (3) certain

          Retirement Plan and Retirement Accounts as agreed upon by the

          parties.

               The parties to the Agreement hereby acknowledge that from

          time to time, Price Services and T. Rowe Price Trust Company may

          enter into contracts ("Other Contracts") with employee benefit

          plans and/or their sponsors for the provision of certain plan

          participant services to Retirement Plans and Retirement Accounts. 

           Compensation paid to Price Services pursuant to this Agreement

          is with respect to the services described herein and not with

          respect to services provided under Other Contracts.  



















          PAGE 7

          B.   Duties of Price Services

               Price Services agrees that it will perform the following

          services:

               1.   Receipt of Orders/Payments

                    Receive for acceptance, orders/payments for the

               purchase of Shares and promptly deliver payment and

               appropriate documentation thereof to the authorized

               custodian of the Fund (the "Custodian").  Upon receipt of

               any check or other instrument drawn or endorsed to it as

               agent for, or identified as being for the account of, the

               Fund, Price Services will process the order as follows: 

               o    Examine the check to determine if the check conforms to

                    the Funds' acceptance procedures (including certain

                    third-party check procedures).  If the check conforms,

                    Price Services will endorse the check and include the

                    date of receipt, will process the same for payment, and

                    deposit the net amount to the parties agreed upon

                    designated bank account prior to such deposit in the

                    Custodial account, and will notify the Fund and the

                    Custodian, respectively, of such deposits (such

                    notification to be given on a daily basis of the total

                    amount deposited to said accounts during the prior

                    business day);  



















          PAGE 8

               o    Open a new account, if necessary, and credit the

                    account of the investor with the number of Shares to be

                    purchased according to the price of the Fund's Shares

                    in effect for purchases made on that date,  subject to

                    any instructions which the Fund may have given to Price

                    Services with respect to acceptance of orders for

                    Shares relating to payments so received by it; 

               o    Maintain a record of all unpaid purchases and report

                    such information to the Fund daily;  

               o    Process periodic payment orders, as authorized by

                    investors, in accordance with the payment procedures

                    for pre-authorized checking ("PAC") and ACH purchases 

                    mutually agreed upon by both parties; 

               o    Receive monies from Retirement Plans and determine the

                    proper allocation of such monies to the Retirement

                    Accounts based upon instructions received from

                    Retirement Plan participants or Retirement Plan

                    administrators ("Administrators"); and

               o    Process telephone orders for purchases of Fund shares

                    from the Shareholder's bank account (via wire or ACH)

                    to the Fund in accordance with procedures mutually

                    agreed upon by both parties.





















          PAGE 9

                    Upon receipt of funds through the Federal Reserve Wire

          System that are designated for purchases in Funds which declare

          dividends at 12:00 p.m. (or such time as set forth in the Fund's

          current prospectus),  Price Services shall promptly notify the

          Fund and the Custodian of such deposit. 

               2.   Redemptions

                    Receive for acceptance redemption requests, including

               telephone redemptions and requests received from

               Administrators for distributions to participants or their

               designated beneficiaries or for payment of fees due the

               Administrator or such other person, including Price

               Services, and deliver the appropriate documentation thereof

               to the Custodian.  Price Services shall receive and stamp

               with the date of receipt, all requests for redemptions of

               Shares (including all certificates delivered to it for

               redemption) and shall process said redemption requests as

               follows, subject to the provisions of Section 7 hereof:

               o    Examine the redemption request and, for written

                    redemptions, the supporting documentation, to determine

                    that the request is in good order and all requirements

                    have been met;























          PAGE 10

               o    Notify the Fund on the next business day of the total

                    number of Shares presented and covered by all such

                    requests;

               o    As set forth in the prospectus of the Fund, and in any

                    event, on or prior to the seventh (7th) calendar day

                    succeeding any such request for redemption, Price

                    Services shall, from funds available in the accounts

                    maintained by Price Services as agent for the Funds,

                    pay the applicable redemption price in accordance with

                    the current prospectus of the Fund, to the investor,

                    participant, beneficiary, Administrator or such other

                    person, as the case may be;  

               o    If any request for redemption does not comply with the

                    Fund's requirements, Price Services shall promptly

                    notify the investor of such fact, together with the

                    reason therefore, and shall effect such redemption at

                    the price in effect at the time of receipt of all

                    appropriate documents; 

               o    Make such withholdings as may be required under

                    applicable Federal and State 

                    taxlaw;  

               o    In the event redemption proceeds for the payment of

                    fees are to be wired through the Federal Reserve Wire 



















          PAGE 11

                    System or by bank wire, Price Services shall cause such

                    proceeds to be wired in Federal funds to the bank

                    account designated; and

               o    Process periodic redemption orders as authorized by the

                    investor in accordance with the periodic withdrawal

                    procedures for Systematic Withdrawal Plan ("SWP") and

                    systematic ACH redemptions mutually agreed upon by both

                    parties.

                    Procedures and requirements for effecting and accepting

               redemption orders from investors by telephone, Tele*Access,

               Mailgram, or written instructions shall be established by

               mutual agreement between Price Services and the Fund

               consistent with the Fund's current prospectus.

               3.   Transfers

                    Effect transfers of Shares by the registered owners

               thereof upon receipt of appropriate instructions and

               documentation and examine such instructions for conformance

               with appropriate procedures and requirements.  In this

               regard, Price Services, upon receipt of a proper request for

               transfer, including any transfer involving the surrender of

               certificates of Shares, is authorized to transfer, on the

               records of the Fund, Shares of the Fund, including

               cancellation of surrendered certificates, if any, to credit 



















          PAGE 12

               a like amount of Shares to the transferee and to

               countersign, issue and deliver new certificates, if

               requested, for those Funds issuing certificates.

               4.   Confirmations

                    Mail all confirmations and other enclosures requested

               by the Fund to the shareholder, and in the case of

               Retirement Accounts, to the Administrators, as may be

               required by the Funds or by applicable Federal or state law.

               5.   Returned Checks and ACH Debits

                    In order to minimize the risk of loss to the Fund by

               reason of any check being returned unpaid, Price Services

               will promptly identify and follow-up on any check or ACH

               debit returned unpaid.  For items returned, Price Services

               may telephone the investor and/or redeposit the check or

               debit for collection or cancel the purchase, as deemed

               appropriate.

               6.   Redemption of Shares under Ten Day Hold

               o    Uncollected Funds

                    Shares purchased by personal, corporate, or

                    governmental check, or by ACH will be considered

                    uncollected until the tenth calendar date following the

                    trade date of the trade ("Uncollected Funds");





















          PAGE 13

               o    Good Funds

                    Shares purchased by treasurer's, cashier, certified, or

                    official check, or by wire transfer will be considered

                    collected immediately ("Good Funds").  Absent

                    information to the contrary (i.e., notification from

                    the payee institution), Uncollected Funds will be

                    considered Good Funds on the tenth calendar day

                    following trade date.

               o    Redemption of Uncollected Funds

                    o    Shareholders making telephone requests for

                         redemption of shares purchased with Uncollected

                         Funds will be given two options:

                         1.   The Shareholder will be permitted to exchange

                         to a money market fund to preserve principal until

                         the payment is deemed Good Funds,

                         2.   The redemption can be processed utilizing the

                         same procedures for written redemptions described

                         below.

                    o    If a written redemption request is made for shares

                         where any portion of the payment for said shares

                         is in Uncollected Funds, and the request is in

                         good order, Price Services will promptly obtain

                         the information relative to the payment necessary 



















          PAGE 14

                         to determine when the payment becomes Good Funds. 

                         The redemption will be processed in accordance

                         with normal procedures, and the proceeds will be

                         held until confirmation that the payment is Good

                         Funds.  On the seventh (7th) calendar day after

                         trade date, and each day thereafter until either

                         confirmation is received or the tenth (10th)

                         calendar day, Price Services will call the paying

                         institution to request confirmation that the check

                         or ACH in question has been paid.  On the tenth

                         calendar day after trade date, the redemption

                         proceeds will be released, regardless of whether

                         confirmation has been received.

               o    Checkwriting Redemptions.

                    o    Daily, all checkwriting redemptions $10,000 and

                         over reported as Uncollected Funds or insufficient

                         funds will be reviewed.  An attempt will be made

                         to contact the shareholder to make good the funds

                         (through wire, exchange, transfer).  Generally by

                         12:00 p.m. the same day, if the matter has not

                         been resolved, the redemption request will be

                         rejected and the check returned to the

                         Shareholder.



















          PAGE 15

                    o    All checkwriting redemptions under $10,000

                         reported as Uncollected or insufficient funds will

                         be rejected and the check returned to the

                         Shareholder.

               o    Confirmations of Available Funds

                    The Fund expects that situations may develop whereby it

                    would be beneficial to determine if a person who has

                    placed an order for Shares has sufficient funds in his

                    or her checking account to cover the payment for the

                    Shares purchased.  When this situation occurs,  Price

                    Services may call the bank in question and request that

                    it confirm that sufficient funds to cover the purchase

                    are currently credited to the account in question. 

                    Price Services will maintain written documentation or a

                    recording of each telephone call which is made under

                    the procedures outlined above.  None of the above

                    procedures shall preclude Price Services from inquiring

                    as to the status of any check received by it in payment

                    for the Fund's Shares as Price Services may deem

                    appropriate or necessary to protect both the Fund and

                    Price Services. If a conflict arises between Section 2

                    and this Section 7, Section 7 will govern.





















          PAGE 16

               7.   Dividends, Distributions and Other Corporate Actions

               o    The Fund will promptly inform Price Services of the

                    declaration of any dividend,  distribution, stock split

                    or any other distributions of a similar kind on account

                    of its Capital Stock.

               o    Price Services shall act as Dividend Disbursing Agent

                    for the Fund, and as such, shall prepare and make

                    income and capital gain payments to investors.  As

                    Dividend Disbursing Agent, Price Services will on or

                    before the payment date of any such dividend or

                    distribution, notify the Custodian of the estimated

                    amount required to pay any portion of said dividend or

                    distribution which is payable in cash, and the Fund

                    agrees that on or before the payment date of such

                    distribution, it shall instruct the Custodian to make

                    available to Price Services sufficient funds for the

                    cash amount to be paid out.  If an investor is entitled

                    to receive additional Shares by virtue of any such

                    distribution or dividend, appropriate credits will be

                    made to his or her account.

               8.   Unclaimed Payments and Certificates

                    In accordance with procedures agreed upon by both

               parties, report abandoned property to appropriate state and 



















          PAGE 17

               governmental authorities of the Fund.  Price Services shall,

               90 days prior to the annual reporting of abandoned property

               to each of the states, make reasonable attempts to locate

               Shareholders for which (a) checks or share certificates have

               been returned; (b) for which accounts have aged outstanding

               checks; or (c) accounts with unissued shares that have been

               coded with stop mail and meet the dormancy period guidelines

               specified in the individual states.   Price Services shall

               make reasonable attempts to contact shareholders for those

               accounts which have significant aged outstanding checks.

               9.   Books and Records

                    Maintain records showing for each Shareholder's

               account, Retirement Plan or Retirement Account, as the case

               may be, the following:

                    o    Names, address and tax identification number;

                    o    Number of Shares held;

                    o    Certain historical information regarding the

                         account of each Shareholder, including dividends

                         and distributions distributed in cash or invested

                         in Shares;

























          PAGE 18

                    o    Pertinent information regarding the establishment

                         and maintenance of Retirement Plans and Retirement

                         Accounts necessary to properly administer each

                         account;

                    o    Information with respect to the source of

                         dividends and distributions allocated among income

                         (taxable and nontaxable income), realized short-

                         term gains and realized long-term gains;

                    o    Any stop or restraining order placed against a

                         Shareholder's account;

                    o    Information with respect to withholdings on

                         domestic and foreign accounts;

                    o    Any instructions from a Shareholder including, all

                         forms furnished by the Fund and executed by a

                         Shareholder with respect to (i) dividend or

                         distribution elections, and (ii) elections with

                         respect to payment options in connection with the

                         redemption of Shares;

                    o    Any correspondence relating to the current

                         maintenance of a Shareholder's account;

                    o    Certificate numbers and denominations for any

                         Shareholder holding certificates;





















          PAGE 19

                    o    Any information required in order for Price

                         Services to perform the calculations contemplated

                         under this Agreement.

                    Price Services shall maintain files and furnish

               statistical and other information as required under this

               Agreement and as may be agreed upon from time to time by

               both parties or required by applicable law.  However, Price

               Services reserves the right to delete, change or add any

               information to the files maintained; provided such

               deletions, changes or additions do not contravene the terms

               of this Agreement or applicable law and do not materially

               reduce the level of services described in this Agreement. 

               Price Services shall also use its best efforts to obtain

               additional statistical and other information as each Fund

               may reasonably request for additional fees as may be agreed

               to by both parties.

                    Any such records maintained pursuant to Rule 31a-1

               under the Investment Company Act of 1940 ("the Act") will be

               preserved for the periods and maintained in a manner

               prescribed in Rule 31a-2 thereunder.  Disposition of such

               records after such prescribed periods shall be as mutually

               agreed upon by the Fund and Price Services.  The retention

               of such records, which may be inspected by the Fund at 



















          PAGE 20

               reasonable times, shall be at the expense of the Fund.  All

               records maintained by Price Services in connection with the

               performance of its duties under this Agreement will remain

               the property of the Fund and, in the event of termination of

               this Agreement, will be delivered to the Fund as of the date

               of termination or at such other time as may be mutually

               agreed upon.

                    All books, records, information and data pertaining to

               the business of the other party which are exchanged or

               received pursuant to the negotiation or the carrying out of

               this Agreement shall remain confidential, and shall not be

               voluntarily disclosed to any other person, except after

               prior notification to and approval by the other party

               hereto, which approval shall not be unreasonably withheld

               and may not be withheld where Price Services or the Fund may

               be exposed to civil or criminal contempt proceedings for

               failure to comply; when requested to divulge such

               information by duly constituted governmental authorities; or

               after so requested by the other party hereto.

               10.  Authorized Issued and Outstanding Shares 

                    Record the issuance of Shares of the Fund and maintain,

               pursuant to Rule 17Ad-10(e) of the '34 Act, a record of the

               total number of Shares of the Fund which are authorized, 



















          PAGE 21

               issued and outstanding, based upon data provided to it by

               the Fund.  Price Services shall also provide the Fund on a

               regular basis the total number of Shares which are

               authorized and issued and outstanding.  Price Services shall

               have no obligation, when recording the issuance of Shares,

               to monitor the issuance of such Shares or to take cognizance

               of any laws relating to the issuance or sale of such Shares.

               11.  Tax Information

                    Prepare and file with the Internal Revenue Service and

               with other appropriate state agencies and, if required, mail

               to investors, those returns for reporting dividends and

               distributions paid as required to be so filed and mailed,

               and shall withhold such sums required to be withheld under

               applicable Federal and state income tax laws, rules, and

               regulations.  Additionally, Price Services will file and, as

               applicable, mail to investors, any appropriate information

               returns required to be filed in connection with Retirement

               Plan processing, such as 1099R, 5498,  as well as any other

               appropriate forms that the Fund or Price Services may deem

               necessary.  The Fund and Price Services shall agree to

               procedures to be followed with respect to Price Services'

               responsibilities in connection with compliance with back-up

               withholding and other tax laws.



















          PAGE 22

               12.  Information to be Furnished to the Fund

                    Furnish to the Fund such information as may be agreed

               upon between the Fund and Price Services including any

               information that the Fund and Price Services agree is

               necessary to the daily operations of the business.

               13.  Correspondence  

                    Promptly and fully answer correspondence from

               shareholders and Administrators relating to Shareholder

               Accounts, Retirement Accounts, transfer agent procedures,

               and such other correspondence as may from time to time be

               mutually agreed upon with the Funds.  Unless otherwise

               instructed, copies of all correspondence will be retained by

               Price Services in accordance with applicable law and

               procedures.

               14.  Lost or Stolen Securities

                    Pursuant to Rule 17f-1 of the '34 Act, report to the

               Securities Information Center and/or the FBI or other

               appropriate person on Form X-17-F-1A all lost, stolen,

               missing or counterfeit securities.  Provide any other

               services relating to lost, stolen or missing securities as

               may be mutually agreed upon by both parties.

               15.  Telephone Services

                    Maintain a Telephone Servicing Staff of representatives



















          PAGE 23

               ("Representatives") sufficient to timely respond to all

               telephonic inquiries reasonably foreseeable.  The

               Representatives will also effect telephone purchases,

               redemptions, exchanges, and other transactions mutually

               agreed upon by both parties, for those Shareholders who have

               authorized telephone services. The Representatives shall

               require each Shareholder effecting a telephone transaction

               to properly identify himself/herself before the transaction

               is effected, in accordance with procedures agreed upon

               between by both parties.   Procedures for processing

               telephone transactions will be mutually agreed upon by both

               parties.    Price Services will also be responsible for

               providing Tele*Access, PC*Access and such other Services as

               may be offered by the Funds from time to time.  Price

               Services will maintain a special Shareholder Servicing staff

               to service certain Shareholders with substantial

               relationships with the Funds.

               16.  Proxies  

                    Monitor the mailing of proxy cards and other material

               supplied to it by the Fund in connection with Shareholder

               meetings of the Fund and shall coordinate the receipt,

               examination and tabulation of returned proxies and the

               certification of the vote to the Fund.



















          PAGE 24

               17.  Form N-SAR  

                    Maintain such records, if any, as shall enable the Fund

               to fulfill the requirements of Form N-SAR.

               18.  Cooperation With Accountants

                    Cooperate with each Fund's independent public

               accountants and take all reasonable action in the

               performance of its obligations under the Agreement to assure

               that the necessary information is made available to such

               accountants for the expression of their opinion without any

               qualification as to the scope of their examination,

               including, but not limited to, their opinion included in

               each such Fund's annual report on Form N-SAR and annual

               amendment to Form N-1A.

               19.  Blue Sky

                    Provide to the Fund or its agent, on a daily, weekly,

               monthly and quarterly basis, and for each state in which the

               Fund's Shares are sold, sales reports and other materials

               for blue sky compliance purposes as shall be agreed upon by

               the parties.

               20.  Other Services

                    Provide such other services as may be mutually agreed

               upon between Price Services and the Fund.





















          PAGE 25

               21.  Fees and Out-of-Pocket Expenses

                    Each Fund shall pay to Price Services and/or its agents

               for its Transfer Agent Services hereunder, fees computed as

               set forth in Schedule A attached.  Except as provided below,

               Price Services will be responsible for all expenses relating

               to the providing of Services.  Each Fund, however, will

               reimburse Price Services for the following out-of-pocket

               expenses and charges incurred in providing Services:

                    o    Postage.  The cost of postage and freight for

                         mailing materials to Shareholders and Retirement

                         Plan participants, or their agents, including

                         overnight delivery, UPS and other express mail

                         services and special courier services required to

                         transport mail between Price Services locations

                         and mail processing vendors.

                    o    Proxies.  The cost to mail proxy cards and other

                         material supplied to it by the Fund and costs

                         related to the receipt, examination and tabulation

                         of returned proxies and the certification of the

                         vote to the Fund.

                    o    Communications

                         o    Print.  The printed forms used internally and

                              externally for documentation and processing 



















          PAGE 26

                              Shareholder and Retirement Plan participant,

                              or their agent's inquiries and requests;

                              paper and envelope supplies for letters,

                              notices, and other written communications

                              sent to Shareholders and Retirement Plan

                              participants, or their agents.

                         o    Print & Mail House.   The cost of internal

                              and third party printing and mail house

                              services, including printing of statements

                              and reports.

                         o    Voice and Data.  The cost of equipment

                              (including associated maintenance), supplies

                              and services used for communicating to and

                              from the Shareholders of the Fund and

                              Retirement Plan participants, or their

                              agents, the Fund's transfer agent, other Fund

                              offices, and other agents of either the Fund

                              or Price Services.  These charges shall

                              include:

                              o    telephone toll charges (both incoming

                                   and outgoing, local, long distance and

                                   mailgrams); and





















          PAGE 27

                              o    data and telephone lines and associated

                                   equipment such as modems, multiplexers,

                                   and facsimile equipment.

                         o    Record Retention.  The cost of maintenance

                              and supplies used to maintain, microfilm,

                              copy, record, index, display, retrieve, and 

                              store, in microfiche or microfilm form,

                              documents and records.

                         o    Disaster Recovery.  The cost of services,

                              equipment, facilities and other charges

                              necessary to provide disaster recovery for

                              any and all services listed in this

                              Agreement.

                    Out-of-pocket costs will be billed at cost to the

          Funds.  Allocation of monthly costs among the Funds will

          generally be made based upon the number of Shareholder and

          Retirement Accounts serviced by Price Services each month.  Some

          invoices for these costs will contain costs for both the Funds

          and other funds serviced by Price Services.  These costs will be

          allocated based on a reasonable allocation methodology.   Where

          possible, such as in the case of inbound and outbound WATS

          charges, allocation will be made on the actual distribution or

          usage.



















          PAGE 28

          C.   Representations and Warranties of Price Services

               Price Services represents and warrants to the Fund that:

               1.   It is a corporation duly organized and existing and in

               good standing under the laws of Maryland;

               2.   It is duly qualified to carry on its business in

               Maryland, California and Florida;

               3.   It is empowered under applicable laws and by its

               charter and by-laws to enter into and perform this

               Agreement;

               4.   All requisite corporate proceedings have been taken to

               authorize it to enter into and perform this Agreement;

               5.   It is registered with the Securities and Exchange

               Commission as a Transfer Agent pursuant to Section 17A of

               the '34 Act; and

               6.   It has and will continue to have access to the

               necessary facilities, equipment and personnel to perform its

               duties and obligations under this Agreement.

          D.   Representations and Warranties of the Fund

               The Fund represents and warrants to Price Services that:

               1.   It is a corporation or business trust duly organized

               and existing and in good standing under the laws of Maryland

               or Massachusetts, as the case may be;

               2.   It is empowered under applicable laws and by its 



















          PAGE 29

               Articles of Incorporation or Declaration of Trust, as the

               case may be, and By-Laws to enter into and perform this

               Agreement;

               3.   All proceedings required by said Articles of

               Incorporation or Declaration of Trust, as the case may be,

               and By-Laws have been taken to authorize it to enter into

               and perform this Agreement;

               4.   It is an investment company registered under the Act;

               and

               5.   A registration statement under the Securities Act of

               1933 ("the '33 Act") is currently effective and will remain

               effective, and appropriate state securities law filings have

               been made and will continue to be made, with respect to all

               Shares of the Fund being offered for sale.

          E.   Standard of Care/Indemnification

               Notwithstanding anything to the contrary in this Agreement:

               1.   Price Services shall not be liable to any Fund for any

               act or failure to act by it or its agents or subcontractors

               on behalf of the Fund in carrying or attempting to carry out

               the terms and provisions of this Agreement provided Price

               Services has acted in good faith and without negligence or

               willful misconduct and selected and monitored the 





















          PAGE 30

               performance of its agents and subcontractors with reasonable

               care.

               2.   The Fund shall indemnify and hold Price Services

               harmless from and against all losses, costs, damages,

               claims, actions and expenses, including reasonable expenses

               for legal counsel, incurred by Price Services resulting

               from:  (i) any action or omission by Price Services or its

               agents or subcontractors in the performance of their duties

               hereunder; (ii) Price Services acting upon instructions

               believed by it to have been executed by a duly authorized

               officer of the Fund; or (iii) Price Services acting upon

               information provided by the Fund in form and under policies

               agreed to by Price Services and the Fund.  Price Services

               shall not be entitled to such indemnification in respect of

               actions or omissions constituting negligence or willful

               misconduct of Price Services or where Price Services has not

               exercised reasonable care in selecting or monitoring the

               performance of its agents or subcontractors.

               3.   Except as provided in Article L of this Agreement,

               Price Services shall indemnify and hold harmless the Fund

               from all losses, costs, damages, claims, actions and

               expenses, including reasonable expenses for legal counsel,

               incurred by the Fund resulting from the negligence or 



















          PAGE 31

               willful misconduct of Price Services or which result from

               Price Services' failure to exercise reasonable care in

               selecting or monitoring the performance of its agents or

               subcontractors.  The Fund shall not be entitled to such

               indemnification in respect of actions or omissions

               constituting negligence or willful misconduct of such Fund

               or its agents or subcontractors; unless such negligence or

               misconduct is attributable to Price Services. 

               4.   In determining Price Services' liability, an isolated

               error or omission will normally not be deemed to constitute

               negligence when it is determined that:

               o    Price Services had in place "appropriate procedures".

               o    the employee(s) responsible for the error or omission

                    had been reasonably trained and were being

                    appropriately monitored; and

               o    the error or omission did not result from wanton or

                    reckless conduct on the part of the employee(s).

               It is understood that Price Services is not obligated to

               have in place separate procedures to prevent each and every

               conceivable type of error or omission.  The term

               "appropriate procedures" shall mean procedures reasonably

               designed to prevent and detect errors and omissions.  In

               determining the reasonableness of such procedures, weight 



















          PAGE 32

               will be given to such factors as are appropriate, including

               the prior occurrence of any similar errors or omissions when

               such procedures were in place and transfer agent industry

               standards in place at the time of the occurrence.

               5.   In the event either party is unable to perform its

               obligations under the terms of this Agreement because of

               acts of God, strikes or other causes reasonably beyond its

               control, such party shall not be liable to the other party

               for any loss, cost, damage, claim, action or expense

               resulting from such failure to perform or otherwise from

               such causes.  

               6.   In order that the indemnification provisions contained

               in this Article E shall apply, upon the assertion of a claim

               for which either party may be required to indemnify the

               other, the party seeking indemnification shall promptly

               notify the other party of such assertion, and shall keep the

               other party advised with respect to all developments

               concerning such claim.  The party who may be required to

               indemnify shall have the option to participate with the

               party seeking indemnification in the defense of such claim,

               or to defend against said claim in its own name or in the

               name of the other party.  The party seeking indemnification

               shall in no case confess any claim or make any compromise in



















          PAGE 33

               any case in which the other party may be required to

               indemnify it except with the other party's prior written

               consent.

               7.   Neither party to this Agreement shall be liable to the

               other party for consequential damages under any provision of

               this Agreement.

          F.   Dual Interests

               It is understood that some person or persons may be

          directors, officers, or shareholders of both the Funds and Price

          Services (including Price Services's affiliates), and that the

          existence of any such dual interest shall not affect the validity

          of this Agreement or of any transactions hereunder except as

          otherwise provided by a specific provision of applicable law.

          G.   Documentation

               o    As requested by Price Services, the Fund shall promptly

                    furnish to Price Services the following:

                    o  A certified copy of the resolution of the

                       Directors/Trustees of the Fund authorizing the

                       appointment of Price Services and the execution and

                       delivery of this Agreement;

                    o  A copy of the Articles of Incorporation or

                       Declaration of Trust, as the case may be, and By-

                       Laws of the Fund and all amendments thereto;



















          PAGE 34

               o    Specimens of all forms of outstanding and new

                    stock/share certificates in the forms approved by the

                    Board of Directors/Trustees of the Fund with a

                    certificate of the Secretary of the Fund as to such

                    approval;

                    o  All account application forms and other documents

                       relating to Shareholders' accounts;

                    o  An opinion of counsel for the Fund with respect to

                       the validity of the stock, the number of Shares

                       authorized, the status of redeemed Shares, and the

                       number of Shares with respect to which a

                       Registration Statement has been filed and is in

                       effect; and

                    o  A copy of the Fund's current prospectus.

               The delivery of any such document for the purpose of any

          other agreement to which the Fund and Price Services are or were

          parties shall be deemed to be delivery for the purposes of this

          Agreement.

          o    As requested by Price Services, the Fund will also furnish

               from time to time the following documents:

               o    Each resolution of the Board of Directors/Trustees of

                    the Fund authorizing the original issue of its Shares;






















          PAGE 35

               o    Each Registration Statement filed with the Securities

                    and Exchange Commission and amendments and orders

                    thereto in effect with respect to the sale of Shares

                    with respect to the Fund;

               o    A certified copy of each amendment to the Articles of

                    Incorporation or Declaration of Trust, and the By-Laws

                    of the Fund;

               o    Certified copies of each vote of the Board of

                    Directors/Trustees authorizing officers to give

                    instructions to the Transfer Agent;

               o    Specimens of all new certificates accompanied by the

                    Board of Directors/Trustees' resolutions approving such

                    forms;

               o    Such other documents or opinions which Price Services,

                    in its discretion, may reasonably deem necessary or

                    appropriate in the proper performance of its duties;

                    and

               o    Copies of new prospectuses issued.

               Price Services hereby agrees to establish and maintain

          facilities and procedures reasonably acceptable to the Fund for

          safekeeping of stock certificates, check forms and facsimile

          signature imprinting devices, if any; and for the preparation or 





















          PAGE 36

          use, and for keeping account of, such certificates, forms and

          devices.

          H.   References to Price Services

               Each Fund agrees not to circulate any printed matter which

          contains any reference to Price Services without the prior

          approval of Price Services, excepting solely such printed matter

          that merely identifies Price Services as agent of the Fund.  The

          Fund will submit printed matter requiring approval to Price

          Services in draft form, allowing sufficient time for review by

          Price Services and its legal counsel prior to any deadline for

          printing.

          I.   Compliance With Governmental Rules and Regulations

               Except as otherwise provided in the Agreement and except for

          the accuracy of information furnished to the Fund by Price

          Services, each Fund assumes full responsibility for the

          preparation, contents and distribution of its prospectuses and

          compliance with all applicable requirements of the Act, the '34

          Act, the '33 Act, and any other laws, rules and regulations of

          governmental authorities having jurisdiction over the Fund. 

          Price Services shall be responsible for complying with all laws,

          rules and regulations of governmental authorities having

          jurisdiction over transfer agents and their activities.





















          PAGE 37

          J.   Ownership of Software and Related Material

               All computer programs, magnetic tapes, written procedures

          and similar items purchased and/or developed and used by Price

          Services in performance of the Agreement shall be the property of

          Price Services and will not become the property of the Fund.

          K.   Quality Service Standards

               Price Services and the Fund may from time to time agree to

          certain quality service standards, as well as incentives and

          penalties with respect to Price Services' hereunder.

          L.   As Of Transactions

               For purposes of this Article L, the term "Transaction" shall

          mean any single or "related transaction" (as defined below)

          involving the purchase or redemption of Shares (including

          exchanges) that is processed at a time other than the time of the

          computation of the Fund's net asset value per Share next computed

          after receipt of any such transaction order by Price Services. 

          If more than one Transaction ("Related Transaction") in the Fund

          is caused by or occurs as a result of the same act or omission,

          such transactions shall be aggregated with other transactions in

          the Fund and be considered as one Transaction.

               o    Reporting   

                    Price Services shall:





















          PAGE 38

                    1.    Utilize a system to identify all Transactions,

                    and shall compute the net effect of such Transactions

                    upon the Fund on a daily, monthly and rolling 365 day

                    basis. The monthly and rolling 365 day periods are

                    hereafter referred to as "Cumulative".

                       2. Supply to the Fund, from time to time as mutually

                       agreed upon, a report summarizing the Transactions

                       and the daily and Cumulative net effects of such

                       Transactions both in terms of aggregate dilution and

                       loss ("Dilution") or gain and negative dilution

                       ("Gain") experienced by the Fund, and the impact

                       such Gain or Dilution has had upon the Fund's net

                       asset value per Share.

                    3.    With respect to any Transaction which causes

                    Dilution to the Fund of $25,000 or more, immediately

                    provide the Fund: (i) a report identifying the

                    Transaction and the Dilution resulting therefrom, (ii)

                    the reason such Transaction was processed as described

                    above, and (iii) the action that Price Services has or

                    intends to take to prevent the reoccurrence of such as

                    of processing ("Report").























          PAGE 39

               o    Liability

                    1.    It will be the normal practice of the Funds not

                    to hold Price Services liable with respect to any

                    Transaction which causes Dilution to any single Fund of

                    less than $25,000.  Price Services will, however,

                    closely monitor for each Fund the daily and Cumulative

                    Gain/Dilution which is caused by Transactions of less

                    than $25,000.  When the Cumulative Dilution to any Fund

                    exceeds 3/10 of 1% per share, Price Services, in

                    consultation with counsel to the Fund, will make

                    appropriate inquiry to determine whether it should take

                    any remedial action.  Price Services will report to the

                    Board of Directors/Trustees of the Fund ("Board") any

                    action it has taken.

                    2.    Where a Transaction causes Dilution to a Fund of

                    $25,000 or more ("Significant Transaction"), Price

                    Services will review with counsel to the Fund the

                    Report and the circumstances surrounding the underlying

                    Transaction to determine whether the Transaction was

                    caused by or occurred as a result of a negligent act or

                    omission by Price Services.  If it is determined that

                    the Dilution is the result of a negligent action or

                    omission by Price Services, Price Services and outside 



















          PAGE 40

                    counsel for the Fund will negotiate settlement.  All

                    such Significant Transactions will be reported to the

                    Board at its next meeting (unless the settlement fully

                    compensates the Fund for any Dilution).  Any

                    Significant Transaction, however, causing Dilution in

                    excess of the lesser of $100,000 or a penny per Share

                    will be promptly reported to the Board.  Settlement

                    will not be entered into with Price Services until

                    approved by the Board.  The factors the Board would be

                    expected to consider in making any determination

                    regarding the settlement of a Significant Transaction

                    would include but not be limited to:

                    o  Procedures and controls adopted by Price Services to

                       prevent "As Of" processing;

                    o  Whether such procedures and controls were being

                       followed at the time of the Significant Transaction;

                    o  The absolute and relative volume of all transactions

                       processed by Price Services on the day of the

                       Significant Transaction;

                    o  The number of Transactions processed by Price

                       Services during prior relevant periods, and the net

                       Dilution/Gain as a result of all such transactions

                       to the Fund and to all other Price Funds;



















          PAGE 41

                    o  The prior response of Price Services to

                       recommendations made by the Funds regarding

                       improvement to the Transfer Agent's "As Of"

                       Processing Procedures.

               3.   In determining Price Services' liability with respect

                    to a Significant Transaction, an isolated error or

                    omission will normally not be deemed to constitute

                    negligence when it is determined that:

                    o    Price Services had in place "appropriate

                         procedures".

                    o    the employee(s) responsible for the error or

                         omission had been reasonably trained and were

                         being appropriately monitored; and

                    o    the error or omission did not result from wanton

                         or reckless conduct on the part of the

                         employee(s).

                    It is understood that Price Services is not obligated

                    to have in place separate procedures to prevent each

                    and every conceivable type of error or omission.  The

                    term "appropriate procedures" shall mean procedures

                    reasonably designed to prevent and detect errors and

                    omissions.  In determining the reasonableness of such

                    procedures, weight will be given to such factors as are



















          PAGE 42

                    appropriate, including the prior occurrence of any

                    similar errors or omissions when such procedures were

                    in place and transfer agent industry standards in place

                    at the time of the occurrence.

          M.   Term and Termination of Agreement

          o    This Agreement shall run for a period of one (1) year from

               the date first written above and will be renewed from year

               to year thereafter unless terminated by either party as

               provided hereunder.

          o    This Agreement may be terminated by the Fund upon one

               hundred twenty (120) days' written notice to Price Services;

               and by Price Services, upon three hundred sixty-five (365)

               days' writing notice to the Fund.

          o    Upon termination hereof, the Fund shall pay to Price

               Services such compensation as may be due as of the date of

               such termination, and shall likewise reimburse for out-of-

               pocket expenses related to its services hereunder.

          N.   Notice

               Any notice as required by this Agreement shall be

          sufficiently given (i) when sent to an authorized person of the

          other party at the address of such party set forth above or at

          such other address as such party may from time to time specify in





















          PAGE 43

          writing to the other party; or (ii) as otherwise agreed upon by

          appropriate officers of the parties hereto.

          O.   Assignment

               Neither this Agreement nor any rights or obligations

          hereunder may be assigned either voluntarily or involuntarily, by

          operation of law or otherwise, by either party without the prior

          written consent of the other party, provided this shall not

          preclude Price Services from employing such agents and

          subcontractors as it deems appropriate to carry out its

          obligations set forth hereunder.

          P.   Amendment/Interpretive Provisions

               The parties by mutual written agreement may amend this

          Agreement at any time.  In addition, in connection with the

          operation of this Agreement, Price Services and the Fund may

          agree from time to time on such provisions interpretive of or in

          addition to the provisions of this Agreement as may in their

          joint opinion be consistent with the general tenor of this

          Agreement.  Any such interpretive or additional provisions are to

          be signed by all parties and annexed hereto, but no such

          provision shall contravene any applicable Federal or state law or

          regulation and no such interpretive or additional provision shall

          be deemed to be an amendment of this Agreement.





















          PAGE 44

          Q.   Further Assurances

               Each party agrees to perform such further acts and execute

          such further documents as are necessary to effectuate the

          purposes hereof.

          R.   Maryland Law to Apply

               This Agreement shall be construed and the provisions thereof

          interpreted under and in accordance with the laws of Maryland.

          S.   Merger of Agreement

               This Agreement, including the attached Appendices and

          Schedules supersedes any prior agreement with respect to the

          subject hereof, whether oral or written.

          T.   Counterparts

               This Agreement may be executed by the parties hereto on any

          number of counterparts, and all of said counterparts taken

          together shall be deemed to constitute one and the same

          instruments.

          U.   The Parties

               All references herein to "the Fund" are to each of the Funds

          listed on Appendix A individually, as if this Agreement were

          between such individual Fund and Price Services.  In the case of

          a series Fund or trust, all references to "the Fund" are to the

          individual series or portfolio of such Fund or trust, or to such

          Fund or trust on behalf of the individual series or portfolio, as



















          PAGE 45

          appropriate.  The "Fund" also includes any T. Rowe Price Funds

          which may be established after the execution of this Agreement. 

          Any reference in this Agreement to "the parties" shall mean Price

          Services and such other individual Fund as to which the matter

          pertains.

          V.   Directors, Trustees and Shareholders and Massachusetts

          Business Trust

               It is understood and is expressly stipulated that neither

          the holders of Shares in the Fund nor any Directors or Trustees

          of the Fund shall be personally liable hereunder. With respect to

          any Fund which is a party to this Agreement and which is

          organized as a Massachusetts business trust, the term "Fund"

          means and refers to the trustees from time to time serving under

          the applicable trust agreement (Declaration of Trust) of such

          Trust as the same may be amended from time to time.  It is

          expressly agreed that the obligations of any such Trust hereunder

          shall not be binding upon any of the trustees, shareholders,

          nominees, officers, agents or employees of the Trust, personally,

          but bind only the trust property of the Trust, as provided in the

          Declaration of Trust of the Trust.  The execution and delivery of

          this Agreement has been authorized by the trustees and signed by

          an authorized officer of the Trust, acting as such, and neither

          such authorization by such Trustees nor such execution and 



















          PAGE 46

          delivery by such officer shall be deemed to have been made by any

          of them, but shall bind only the trust property of the Trust as

          provided in its Declaration of Trust.

          W.   Captions

               The captions in the Agreement are included for convenience

          of reference only and in no way define or limit any of the

          provisions hereof or otherwise affect their construction or

          effect.

               IN WITNESS WHEREOF, the parties hereto have caused this

          Agreement to be executed in their names and on their behalf under

          their seals by and through their duly authorized officers.


          DATED:  ______________________     T. ROWE PRICE SERVICES, INC.

          ATTEST:

                                                  /s/Wayne D. O'Melia
          ___________________________        BY:  _________________________
                                                  Wayne D. O'Melia


































          PAGE 47
          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT FUND, INC.

          T. ROWE PRICE BALANCED FUND, INC.

          T. ROWE PRICE BLUE CHIP GROWTH FUND, INC. 

          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
             California Tax-Free Bond Fund
             California Tax-Free Money Fund

          T. ROWE PRICE CAPITAL APPRECIATION FUND

          T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

          T. ROWE PRICE DIVIDEND GROWTH FUND, INC

          T. ROWE PRICE EQUITY INCOME FUND

          T. ROWE PRICE EQUITY SERIES, INC.
             T. Rowe Price Equity Income Portfolio
             T. Rowe Price New America Growth Portfolio
             T. Rowe Price Personal Strategy Balanced Portfolio

          T. ROWE PRICE FIXED INCOME SERIES, INC.
             T. Rowe Price Limited-Term Bond Portfolio

          T. ROWE PRICE GNMA FUND

          T. ROWE PRICE GROWTH & INCOME FUND, INC.

          T. ROWE PRICE GROWTH STOCK FUND, INC.

          T. ROWE PRICE HIGH YIELD FUND, INC.

          T. ROWE PRICE INDEX TRUST, INC.
             T. Rowe Price Equity Index Fund

          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
             Foreign Equity Fund


























          PAGE 48
          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
             T. Rowe Price International Bond Fund
             T. Rowe Price International Discovery Fund
             T. Rowe Price International Stock Fund
             T. Rowe Price European Stock Fund
             T. Rowe Price New Asia Fund
             T. Rowe Price Global Government Bond Fund
             T. Rowe Price Japan Fund
             T. Rowe Price Short-Term Global Fund
             T. Rowe Price Latin America Fund
             T. Rowe Price Emerging Markets Bond Fund

          T. ROWE PRICE INTERNATIONAL SERIES, INC.
             T. Rowe Price International Stock Portfolio

          T. ROWE PRICE MID-CAP GROWTH FUND, INC.

          T. ROWE PRICE NEW AMERICA GROWTH FUND

          T. ROWE PRICE NEW ERA FUND, INC.

          T. ROWE PRICE NEW HORIZONS FUNDS, INC.

          T. ROWE PRICE NEW INCOME FUND, INC.

          T. ROWE PRICE OTC FUND, INC.
             T. Rowe Price OTC Fund

          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
             T. Rowe Price Personal Strategy Balanced Fund
             T. Rowe Price Personal Strategy Growth Fund
             T. Rowe Price Personal Strategy Income Fund

          T. ROWE PRICE PRIME RESERVE FUND, INC.

          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

          T. ROWE PRICE SPECTRUM FUND, INC.
             Spectrum Growth Fund
             Spectrum Income Fund





















          PAGE 49
          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
             Maryland Tax-Free Bond Fund
             Maryland Short-Term Tax-Free Bond Fund
             New York Tax-Free Bond Fund
             New York Tax-Free Money Fund
             New Jersey Tax-Free Bond Fund
             Virginia Tax-Free Bond Fund
             Virginia Short-Term Tax-Free Bond Fund
             Florida Insured Intermediate Tax-Free Fund
             Georgia Tax-Free Bond Fund

          T. ROWE PRICE SUMMIT FUNDS, INC.
             T. Rowe Price Summit Cash Reserves Fund
             T. Rowe Price Summit Limited-Term Bond Fund
             T. Rowe Price Summit GNMA Fund

          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
             T. Rowe Price Summit Municipal Money Market Fund
             T. Rowe Price Summit Municipal Intermediate Fund
             T. Rowe Price Summit Municipal Income Fund

          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND FUND, INC.

          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.

          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
             U.S. Treasury Intermediate Fund
             U.S. Treasury Long-Term Fund
             U.S. Treasury Money Fund

          T. ROWE PRICE VALUE FUND, INC.


          DATED:  ______________________

          ATTEST:

                                             /s/Carmen F. Deyesu
          _________________________     BY:  __________________________
                                             Carmen F. Deyesu



















          PAGE 50
                                      APPENDIX A


             The following Funds are parties to this Agreement, and have so

          indicated their intention to be bound by such Agreement by

          executing the Agreement on the dates indicated thereon.

          T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.

          T. Rowe Price Blue Chip Growth Fund, Inc.

          T. Rowe Price Balanced Fund, Inc.

          T. Rowe Price California Tax-Free Income Trust on behalf of the
             California Tax-Free Bond Fund and
             California Tax-Free Money Fund

          T. Rowe Price Capital Appreciation Fund

          T. Rowe Price Capital Opportunity Fund, Inc.

          T. Rowe Price Dividend Growth Fund, Inc.

          T. Rowe Price Equity Income Fund

          T. Rowe Price Equity Series, Inc. on behalf of the
             T. Rowe Price Equity Income Portfolio
             T. Rowe Price New America Growth Portfolio
             T. Rowe Price Personal Strategy Balanced Portfolio

          T. Rowe Price Fixed Income Series, Inc. on behalf of the
             T. Rowe Price Limited-Term Bond Portfolio

          T. Rowe Price GNMA Fund

          T. Rowe Price Growth & Income Fund, Inc.

          T. Rowe Price Growth Stock Fund, Inc.

          T. Rowe Price High Yield Fund, Inc.

          T. Rowe Price Index Trust, Inc. on behalf of the 
          T. Rowe Price Equity Index Fund




















          PAGE 51
          Institutional International Funds, Inc. on behalf of the
             Foreign Equity Fund

          T. Rowe Price International Funds, Inc. on behalf of the
             T. Rowe Price International Bond Fund and
             T. Rowe Price International Stock Fund
             T. Rowe Price International Discovery Fund
             T. Rowe Price European Stock Fund
             T. Rowe Price New Asia Fund
             T. Rowe Price Global Government Bond Fund
             T. Rowe Price Japan Fund
             T. Rowe Price Short-Term Global Fund
             T. Rowe Price Latin America Fund
             T. Rowe Price Emerging Markets Bond Fund

          T. Rowe Price International Series, Inc. on behalf of the
             T. Rowe Price International Stock Portfolio

          T. Rowe Price Mid-Cap Growth Fund

          T. Rowe Price New America Growth Fund

          T. Rowe Price New Era Fund, Inc.

          T. Rowe Price New Horizons Fund, Inc.

          T. Rowe Price New Income Fund, Inc.

          T. Rowe Price Personal Strategy Funds, Inc.
             T. Rowe Price Personal Strategy Balanced Fund
             T. Rowe Price Personal Strategy Growth Fund
             T. Rowe Price Personal Strategy Income Fund

          T. Rowe Price Prime Reserve Fund, Inc.

          T. Rowe Price OTC Fund, Inc. on behalf of the
             T. Rowe Price OTC Fund

          T. Rowe Price Science & Technology Fund, Inc.

          T. Rowe Price Short-Term Bond Fund, Inc.

          T. Rowe Price Small-Cap Value Fund, Inc.






















          PAGE 52
          T. Rowe Price Spectrum Fund, Inc. on behalf of the
             Spectrum Growth Fund
             Spectrum Income Fund

          T. Rowe Price State Tax-Free Income Trust on behalf of the
             Maryland Tax-Free Bond Fund
             Maryland Short-Term Tax-Free Bond Fund  
             New York Tax-Free Bond Fund 
             New York Tax-Free Money Fund
             New Jersey Tax-Free Bond Fund
             Virginia Tax-Free Bond Fund
             Virginia Short-Term Tax-Free Bond Fund
             Georgia Tax-Free Bond Fund
             Florida Insured Intermediate Tax-Free Fund

          T. Rowe Price Tax-Exempt Money Fund, Inc.

          T. Rowe Price Tax-Free High Yield Fund, Inc.

          T. Rowe Price Tax-Free Income Fund, Inc.

          T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc. 

          T. Rowe Price Tax-Free Short-Intermediate Fund, Inc.

          T. Rowe Price U.S. Treasury Funds, Inc. on behalf of the
             U.S. Treasury Intermediate Fund
             U.S. Treasury Long-Term Fund
             U.S. Treasury Money Fund

          T. Rowe Price Value Fund, Inc.

          T. Rowe Price Summit Funds, Inc. on behalf of the
             T. Rowe Price Summit Cash Reserves Fund
             T. Rowe Price Summit Limited-Term Bond Fund 
             T. Rowe Price Summit GNMA Fund

          T. Rowe Price Summit Municipal Funds, Inc. on behalf of the 
             T. Rowe Price Summit Municipal Money Market Fund
             T. Rowe Price Summit Municipal Intermediate Fund
             T. Rowe Price Summit Municipal Income Fund
           























          PAGE 53
                             SCHEDULE A  -  FEE SCHEDULE

                   Effective January 1, 1995 to December 31, 1995, 
                                 For the account of:

                               THE T. ROWE PRICE FUNDS

                                     EQUITY FUNDS

                       T. Rowe Price New American Growth Fund 
                        T. Rowe Price Growth Stock Fund, Inc.
                        T. Rowe Price New Horizons Fund, Inc.
                           T. Rowe Price New Era Fund, Inc.
                        T. Rowe Price International Stock Fund
                           T. Rowe Price Equity Income Fund
                       T. Rowe Price Growth & Income Fund, Inc.
                       T. Rowe Price Capital Appreciation Fund
                    T. Rowe Price Science & Technology Fund, Inc.
                     T. Rowe Price Small Capital Value Fund, Inc.
                      T. Rowe Price International Discovery Fund
                                 Foreign Equity Fund
                           T. Rowe Price Equity Index Fund
                          T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                          T. Rowe Price Spectrum Growth Fund
                               T.Rowe Price Japan Fund
                           T. Rowe Price Latin America Fund
                          T. Rowe Price Balanced Fund, Inc.
                       T. Rowe Price Dividend Growth Fund, Inc.
                       T. Rowe Price Mid-Cap Growth Fund, Inc.
                      T. Rowe Price Over-the-Counter Fund, Inc.
                      T. Rowe Price Blue Chip Growth Fund, Inc.
                     T. Rowe Price Capital Opportunity Fund, Inc.
                     T. Rowe Price International Stock Portfolio
                    T. Rowe Price Personal Strategy Balanced Fund
                     T. Rowe Price Personal Strategy Growth Fund
                            T. Rowe Price Value Fund, Inc.
                        T. Rowe Price Equity Income Portfolio
                      T. Rowe Price New America Growth Portfolio
                  T. Rowe Price Personal Strategy Balanced Portfolio

























          PAGE 54
                                      BOND FUNDS

                         T. Rowe Price New Income Fund, Inc.
                       T. Rowe Price Tax-Free Income Fund, Inc.
                     T. Rowe Price New Jersey Tax-Free Bond Fund
                      T. Rowe Price Virginia Tax-Free Bond Fund
                 T. Rowe Price Virginia Short-Term Tax-Free Bond Fund
                       T. Rowe Price Short Term Bond Fund, Inc.
                 T. Rowe Price Tax-Free Short Intermediate Fund, Inc.
                         T. Rowe Price High Yield Fund, Inc.
                     T. Rowe Price Tax-Free High Yield Fund, Inc.
               T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
                               T. Rowe Price GNMA Fund
                      T. Rowe Price New York Tax-Free Bond Fund
                     T. Rowe Price California Tax-Free Bond Fund
                        T. Rowe Price International Bond Fund
                 T. Rowe Price Maryland Short-Term Tax-Free Bond Fund
                      T. Rowe Price Maryland Tax-Free Bond Fund
                    T. Rowe Price U.S. Treasury Intermediate Fund
                      T. Rowe Price U.S. Treasury Long-Term Fund
                      T. Rowe Price Global Government Bond Fund
                          T. Rowe Price Spectrum Income Fund
                      T. Rowe Price Short-term Global Bond Fund
                T. Rowe Price Tax-Free Insured Intermediate Fund, Inc.
                       T. Rowe Price Georgia Tax-Free Bond Fund
               T. Rowe Price Florida Insured Intermediate Tax-Free Fund
                     T. Rowe Price Summit Limited-Term Bond Fund
                           T. Rowe Price  Summit GNMA Fund
                   T. Rowe Price Summit Municipal Intermediate Fund
                      T. Rowe Price Summit Municipal Income Fund
                      T. Rowe Price Limited-Term Bond Portfolio
                       T. Rowe Price Emerging Markets Bond Fund
                     T. Rowe Price Personal Strategy Income Fund


                                  Money Market Funds

                        T. Rowe Price Prime Reserve Fund, Inc.
                      T. Rowe Price Tax-Exempt Money Fund, Inc.
                        T. Rowe Price U.S. Treasury Money Fund
                      T. Rowe Price New York Tax-Free Money Fund
                     T. Rowe Price California Tax-Free Money Fund
                       T. Rowe Price Summit Cash Reserves Fund
                   T. Rowe Price Summit Municipal Money Market Fund





















          PAGE 55
             The following fees for services provided by T. Rowe Price
          Services, Inc. (TRPS) and vendors will be billed by TRPS for
          1995:

          I. T. Rowe Price Services Maintenance and Transaction Charges -
          Billable Monthly

             A.   Base Fee

                  1.  Per Fund - Beginning January 1, 1995, chargeable at
                      the rate of $1,000 per month to each Fund shown on
                      the previous page.  The fee is waived for new Funds
                      for the first 6 months after effective date.

                  2.  Monthly - $5,987,000 payable in twelve monthly
                      installments of $498,917.

             B.   Per Account Annual Fee - $3.63 for each Equity, Bond, and
                  Money Market Account serviced.

                  The Per Account Annual Fee will be billed monthly at a
                  rate of 1/12 of the annual fee for each.  Fund account
                  serviced during the month. Accounts serviced is defined
                  as all open accounts at month end plus accounts which
                  closed during the month.

             C.   Transaction Fees

                  1.  New Account Fees

                      a.  $3.00 for every account opened, including
                          fiduciary accounts, excluding those opened by
                          exchange and those established as described in
                          (b) below.

                      b.  A fee of $1.00 will be assessed for accounts
                          established within the model and list functions
                          programs and under the agreement that the
                          registrant's name will be quality controlled
                          subsequent to its establishment.

                  2.  Non-Automated Transactions

                      a.  $1.05 for each non-automated transaction and
                          maintenance item processed for the Fund Group as
                          a whole during a month.  The non-automated
                          transaction count will include all manually 


















          PAGE 56
                          processed price dependent and maintenance
                          transactions.  Also, the number of new account
                          setups will be excluded from the number of non-
                          automated transactions.

                      b.  Fee to be charged to the Funds based on each
                          Fund's number of total non-automated
                          transactions and maintenance. 

                      c.  Fee to be billed monthly for that month.

                      d.  NOTE:    The transaction count should not include
                                   correction of transactions caused by
                                   non-shareholder errors.

             D.   Telephone Fee

                  Billed at the rate of $5.20 per call for shareholder
                  servicing calls received in excess of 34,000 calls per
                  month.  Calls received in Retail Services are allocated
                  to the Funds based on accounts serviced and calls
                  received in Telephone Services are allocated based on
                  actual calls received.

             E.   Items Scanned

                  $.29 will be billed for each document page scanned.  It
                  will be allocated based on the number of items indexed to
                  each Fund.

             F.   Tele*Access

                  Base fee, per month for all calls is $50,000.

             G.   Institutional Electronic Interface

                  Maximum fee calculated is 10 basis points or less per
                  Fund.

                      10 basis points < $500 million
                       8 basis points > $500 million < $1 billion
                       5 basis points > $1 billion < $2 billion























          PAGE 57
             H.   Correspondence

                  $4.20 billed for each shareholder correspondence request
                  completed in writing or by phone.  Allocated to the Funds
                  based on accounts serviced.

             I.   Telephone Transaction Fee

                  Each price dependent transaction initiated through the
                  Telephone Services Group will be charged $.50. 

          II.     Vendor Fees

             A.   DST

                  1.  Annual Open Account Fee

                      a.  $1.82 for each Equity Fund account serviced.

                      b.  $4.33 for each Bond Fund account serviced.

                      c.  $4.33 for each Money Market Fund account
                          serviced.

                      The Open Account Fee will be billed monthly at a rate
                      of 1/12 of the annual fee for each Fund account
                      serviced during the month.

                  2.  Closed Account Fee (Annualized)

                      Payable at an annual rate of $1.48.  The Closed
                      Account Fee will be billed monthly at a rate of 1/12
                      of the annual rate and will be charged in the month
                      following the month during which such account is
                      closed and shall cease to be charged in the month
                      following the Purge Date.

                  3.  Fiduciary Sub-Accounting

                      Payable at the rate of $1.00 per month for each
                      fiduciary account.  Fiduciary accounts closed during
                      the prior year will not be included as billable
                      items.






















          PAGE 58
                  4.  Annual Base Fee Per Fund

                      Annual Fee of $7,422.00 will be charged at a monthly
                      rate of $618.50.  The fee is waived for the first six
                      (6) months after a new Fund is effective.  The
                      definition of new Fund excludes Funds created by
                      mergers, purchases, or reorganizations.

                  5.  Bank Account Reconciliation System (Comp/Recon)

                      Annual charge of $120,000 payable at a rate of
                      $10,000 per month.

                  6.  TRAC 2000 - $7.00 per participant, per year; For
                      TRAC+ $5.00 per participant, per year.

                  7.  Voice Response Unit

                      a.  $500 Set-up Fee will be charged for each
                          investment company unit.

                      b.  $2,500 Maintenance Fee will be billed each
                          month.

                      c.  $.50 will be billed per call connected to the
                          VRU.

                  8.  Contingent Deferred Sales Charge.

                      Billed to each Fund utilizing this service at an
                      annual rate of $1.06 per open account.

             B.   State Street Bank

                  1.  NSCC Settlements

                      a.  $11.65 for net redemptions

                      b.  $ 5.30 per net purchases 

                  2.  Checkwriting Fees

                      $.585 for each checkwriting item processed (i.e.
                      those resulting in either redemptions or  returned as
                      non-processable).  This includes signature card
                      maintenance and verification, manual or special
                      processing of checks, stop payment processing, 


















          PAGE 59
                      settlement functions, and postage and mailing
                      expenses to return canceled checks to shareholders.

                  3.  ACH Transactions

                      $.06 for each ACH transaction processed by the Bank
                      and submitted to the ACH network.

                  4.  Internal Book Transfers

                      $1.11 billed for money movement between TRP DDA's at
                      the Bank.  Money is transferred by debit and credit
                      memos.

                      or Recon WT $.70 -$.35 credit
                                       -$.35 debit

                  5.  Wire Fees

                      $4.12 for each incoming, manual, and internal bank
                      transfer wire; $3.87 for each outgoing transmission
                      wire.

                  6.  Paid checks

                      $.19 for each paid check processed.

                  7.  DDA Research

                      $1.06 per request.

                  8.  Nightly Audits

                      $.0310 per page for the audit of the DST nightly
                      update.

                  10. VAX Computer Usage

                      Billed at the rate of $8,709.56 per month which
                      covers both:

                      a.  System Fee - for use of sub-systems such as
                          capital stock interface, PDPS, Direct Deposit,
                          etc.

                      b.  Communication Fee - charge for the line, modems,
                          and statistical multiplexers.


















          PAGE 60
                  11. Abandoned Property

                      Services based on the following fee schedule:

                      a.  Administrative charge        $125/Fund
                      b.  Processing charges           $1.00/account
                      c.  Due Diligence Mailings       $1.35/account 
                      d.  Labor will be charged based on the number of
                          hours required. 
                      e.  Lost shareholder recovery    $2.25/account
                                                       initial attempt
                                                       $5.00/s/o any s/o
                                                       located
                                                       $500.00 one time
                                                       set up charge

                  12. Account maintenance $16.49 per account per month

                  13. Reporting (SSCAN) for selected accounts - $51.54 per
                      account per month

                  14. FDIC Passthrough - charged at prevailing FDIC rates

             C.   J.P. Morgan Bank

                  1.  Wire Transfer Fees

                      Annual Account Maintenance            $250.00
                      Annual MORCOM/CASH
                        First Account                       $5,000.00
                        Subsequent Accounts                 $3,000.00

                        Batch File Transfer (BFT)
                          Transmission                      $15.00 each
                          (capped at 10 per month)

                        BFT Per Outgoing Wire
                          Peak (8 a.m. and 8 p.m.)          $0.064
                          Off Peak (8 p.m. and 8 a.m.)      $0.032

                      Outgoing Wires
                        Straight-through (Repetitive or Freetype)
                          80% of total volume               $3.25
                        Book Transfer (IBT)                 $1.50
                        Repair (Freeform)                   $7.00
                        Zero Balance Transfer               $1.00



















          PAGE 61
                      Incoming Wires
                        Fed or CHIPS                        $3.25
                        Book (IBT)                          $1.50

                      FDIC Passthrough - charged at prevailing FDIC rates

                  2.  Controlled Disbursement Fees

                      Annual Account Maintenance
                        (capped at 6 accounts)              $760.00 per
                                                            account
                      Annual MORCOM Next Day                $1,385.00 per
                                                            account
                      Annual MORCOM Check                   $715.00 per
                                                            account

                      Batch File Transfer (BFT)
                      Transmission (capped at 10 per month) $15.00 each

                      Same Day Match Pay (Dividend & Redemption Checks)
                        DCD Match                           $2,500.00 per
                                                            account
                        TRPS Matches                        .005 per item

                      Checks Paid
                        Up to 500,000 items                 $0.051
                        Up to 750,000 items                 $0.042
                        Up to 1,000,000 items               $0.035

                      Stops
                        On-line                             $3.00

                      Returned Checks                       $5.00 per item

                  3.  The bank may charge interest at a rate in excess of
                      normal borrowing rates if the TRPS balance is
                      overdrawn or is in a negative collected balance
                      status.



























          PAGE 62
             D.   First National Bank of Maryland

                  1.  Internal Fund Transfer                $6.00
                  2.  Returned Items                        $2.70
                  3.  Deposit Items                         Charge varies
                                                            1
                  4.  Deposit Tickets                       $.45
                  5.  Return/redeposit items                $3.00
                  6.  Deposit Corrections                   $4.50
                  7.  Check copy                            $9.00
                  8.  First Facts 
                        CDA Repetitive Wire                 $3.95
                        System Reports/Per Module           $27.00
                        Per Report Previous Day             $1.80
                        Per Report Current Day              $3.60
                  9.  Account maintenance                   $11.25
                  10. Debit item                            $.54
                  11. Credit transaction                    $.54
                  12. Foreign Deposit Check amount $1,000-$4,999      $7.50
                          $5,000-19,999                     $15.00
                          < $20,000                         $20.00
                  13. ACH Debit                             $.117
                  14. Tax Deposits                          $.90
                  15. Film - Monthly                        $121.50

                  16. TRPS may be charged interest when TRPS's 
                      balance at FNB is in a negative collected 
                      balance status.  TRPS may also receive 
                      balance credits on a positive investable balance
                  17. FDIC Passthrough charged at prevailing FDIC rates

          III.    New Funds

             Funds added during the term of this contract may have their
             Maintenance and Transaction charges and other charges (Section
             I) waived for a period of time, as agreed to by TRPS and Fund
             Directors, following the establishment of the Fund.  Out-of-
             pocket expenses will be billed to the Fund from the Fund's
             inception.





                                        ____________________

               1Charge varies by District, $ .0247 to $ .1147


















          PAGE 63
          IN WITNESS WHEREOF, T.Rowe Price Funds and T.Rowe Price Services,
          Inc. have agreed upon this fee schedule to be executed in their
          names and on their behalf through their duly authorized officers:

          T. ROWE PRICE FUNDS           T. ROWE PRICE SERVICES, INC.


          NAME  ____________________    NAME  _________________________

          TITLE  ______________________ TITLE _________________________

          DATE  _______________________ DATE  _________________________ 





















































          PAGE 64
                                   AMENDMENT NO. 1
                        TRANSFER AGENCY AND SERVICE AGREEMENT
                                       Between
                             T. ROWE PRICE SERVICES, INC.
                                         And
                               THE T. ROWE PRICE FUNDS

               The Transfer  Agency  and Service  Agreement  of January  1,

          1995,  between T.  Rowe  Price  Services, Inc.  and  each of  the

          Parties listed  on Appendix  A thereto is  hereby amended,  as of

          January 25,  1995, by adding  thereto the T. Rowe  Price Emerging

          Markets  Stock Fund,  a  separate  series of  the  T. Rowe  Price

          International Funds, Inc.

                              T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                                FUND, INC.

                              T. ROWE PRICE BALANCED FUND, INC.

                              T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                              T.  ROWE  PRICE  CALIFORNIA  TAX-FREE  INCOME
                              TRUST
                              California Tax-Free Bond Fund
                              California Tax-Free Money Fund

                              T. ROWE PRICE CAPITAL APPRECIATION FUND

                              T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                              T. ROWE PRICE DIVIDEND GROWTH FUND, INC

                              T. ROWE PRICE EQUITY INCOME FUND

                              T. ROWE PRICE EQUITY SERIES, INC.
                              T. Rowe Price Equity Income Portfolio
                              T. Rowe Price New America Growth Portfolio
                              T.  Rowe  Price  Personal  Strategy  Balanced
                              Portfolio

                              T. ROWE PRICE FIXED INCOME SERIES, INC.
                              T. Rowe Price Limited-Term Bond Portfolio


















                              T. ROWE PRICE GNMA FUND

          PAGE 65
                              T. ROWE PRICE GROWTH & INCOME FUND, INC.

                              T. ROWE PRICE GROWTH STOCK FUND, INC.

                              T. ROWE PRICE HIGH YIELD FUND, INC.

                              T. ROWE PRICE INDEX TRUST, INC.
                              T. Rowe Price Equity Index Fund

                              INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                              Foreign Equity Fund

                              T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.

                              T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                              T. Rowe Price International Bond Fund
                              T. Rowe Price International Discovery Fund
                              T. Rowe Price International Stock Fund
                              T. Rowe Price European Stock Fund
                              T. Rowe Price New Asia Fund
                              T. Rowe Price Global Government Bond Fund
                              T. Rowe Price Japan Fund
                              T. Rowe Price Short-Term Global Fund
                              T. Rowe Price Latin America Fund
                              T. Rowe Price Emerging Markets Bond Fund
                              T. Rowe Price Emerging Markets Stock Fund

                              T. ROWE PRICE INTERNATIONAL SERIES, INC.
                              T. Rowe Price International Stock Portfolio

                              T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                              T. ROWE PRICE NEW AMERICA GROWTH FUND

                              T. ROWE PRICE NEW ERA FUND, INC.

                              T. ROWE PRICE NEW HORIZONS FUNDS, INC.

                              T. ROWE PRICE NEW INCOME FUND, INC.

                              T. ROWE PRICE OTC FUND, INC.
                              T. Rowe Price OTC Fund

                              T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                              T. Rowe Price Personal Strategy Balanced Fund


















                              T. Rowe Price Personal Strategy Growth Fund
                              T. Rowe Price Personal Strategy Income Fund
          PAGE 66

                              T. ROWE PRICE PRIME RESERVE FUND, INC.

                              T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                              T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                              T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                              T. ROWE PRICE SPECTRUM FUND, INC.
                              Spectrum Growth Fund
                              Spectrum Income Fund

                              T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                              Maryland Tax-Free Bond Fund
                              Maryland Short-Term Tax-Free Bond Fund
                              New York Tax-Free Bond Fund
                              New York Tax-Free Money Fund
                              New Jersey Tax-Free Bond Fund
                              Virginia Tax-Free Bond Fund
                              Virginia Short-Term Tax-Free Bond Fund
                              Florida Insured Intermediate Tax-Free Fund
                              Georgia Tax-Free Bond Fund

                              T. ROWE PRICE SUMMIT FUNDS, INC.
                              T. Rowe Price Summit Cash Reserves Fund
                              T. Rowe Price Summit Limited-Term Bond Fund
                              T. Rowe Price Summit GNMA Fund

                              T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                              T. Rowe  Price Summit Municipal  Money Market
                              Fund
                              T. Rowe  Price Summit  Municipal Intermediate
                              Fund
                              T. Rowe Price Summit Municipal Income Fund

                              T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                              T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                              T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                              T. ROWE  PRICE TAX-FREE  INSURED INTERMEDIATE
                              FUND, INC.



















                              T.  ROWE  PRICE  TAX-FREE  SHORT-INTERMEDIATE
                              FUND, INC.

          PAGE 67

                              T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                              U.S. Treasury Intermediate Fund
                              U.S. Treasury Long-Term Fund
                              U.S. Treasury Money Fund

                              T. ROWE PRICE VALUE FUND, INC.
          Attest:

          /s/Patricia S. Butcher        /s/Carmen F. Deyesu
          ______________________        ______________________________
          Patricia S. Butcher,          By: Carmen F. Deyesu
          Assistant Secretary

          Attest:                       T. ROWE PRICE SERVICES, INC.

          /s/Barbara A. Van Horn        /s/Henry H. Hopkins
          ______________________        ______________________________
          Barbara A. Van Horn,          By: Henry H. Hopkins,
          Assistant Secretary           Vice President







































          
 The Agreement between T. Rowe Price Associates, Inc. and
          T. Rowe Price Funds for Fund Accounting Services, dated January
          1, 1995, as amended, should be inserted here.
             

























          PAGE 1
                                       AGREEMENT
                                       between
                            T. ROWE PRICE ASSOCIATES, INC.
                                         and
                               THE T. ROWE PRICE FUNDS
                                         for
                               FUND ACCOUNTING SERVICES







































          PAGE 2
                                  TABLE OF CONTENTS

                                                                      Page

          Article A  Terms of Appointment/Duties of Price
                     Associates   . . . . . . . . . . . . . . . . . .  1

          Article B  Fees and Out-of-Pocket Expenses  . . . . . . . .  2

          Article C  Representations and Warranties of Price
                     Associates   . . . . . . . . . . . . . . . . . .  3

          Article D  Representations and Warranties of the Fund   . .  3

          Article E  Ownership of Software and Related Material   . .  3

          Article F  Quality Service Standards  . . . . . . . . . . .  4

          Article G  Standard of Care/Indemnification   . . . . . . .  4

          Article H  Dual Interests   . . . . . . . . . . . . . . . .  5

          Article I  Documentation  . . . . . . . . . . . . . . . . .  5

          Article J  Recordkeeping/Confidentiality  . . . . . . . . .  5

          Article K  Compliance with Governmental Rules and
                     Regulations  . . . . . . . . . . . . . . . . . .  6

          Article L  Terms and Termination of Agreement   . . . . . .  6

          Article M  Notice   . . . . . . . . . . . . . . . . . . . .  6

          Article N  Assignment   . . . . . . . . . . . . . . . . . .  7

          Article O  Amendment/Interpretive Provisions  . . . . . . .  7

          Article P  Further Assurances   . . . . . . . . . . . . . .  7

          Article Q  Maryland Law to Apply  . . . . . . . . . . . . .  7

          Article R  Merger of Agreement  . . . . . . . . . . . . . .  7

          Article S  Counterparts   . . . . . . . . . . . . . . . . .  8

          Article T  The Parties  . . . . . . . . . . . . . . . . . .  8



















          PAGE 3
          Article U  Directors, Trustee and Shareholders and
                     Massachusetts Business Trust   . . . . . . . . .  8

          Article V  Captions   . . . . . . . . . . . . . . . . . . .   9





























































          PAGE 4

               AGREEMENT made as of the first day of January, 1995, by and

          between T. ROWE PRICE ASSOCIATES, INC., a Maryland corporation

          having its principal office and place of business at 100 East

          Pratt Street, Baltimore, Maryland 21202 ("Price Associates"), and

          each Fund which is listed on Appendix A (as such Appendix may be

          amended from time to time) and which evidences its agreement to

          be bound hereby by executing a copy of this Agreement (each such

          Fund individually hereinafter referred to as "the Fund", whose

          definition may be found in Article T); 

               WHEREAS, Price Associates has the capability of providing

          the Funds with certain accounting services ("Accounting

          Services");

               WHEREAS, the Fund desires to appoint Price Associates to

          provide these Accounting Services and Price Associates desires to

          accept such appointment;

               WHEREAS, the Board of Directors of the Fund has authorized

          the Fund to utilize various pricing services for the purpose of

          providing to Price Associates securities prices for the

          calculation of the Fund's net asset value.

               NOW, THEREFORE, in consideration of the mutual covenants

          herein contained, the parties hereto agree as follows:























          PAGE 5

          A.   Terms of Appointment/Duties of Price Associates

               Subject to the terms and conditions set forth in this

          Agreement, the Fund hereby employs and appoints Price Associates

          to provide, and Price Associates agrees to provide, the following

          Accounting Services:

               a.   Maintain for each Fund a daily trial balance, a general

                    ledger, subsidiary records and capital stock accounts;

               b.   Maintain for each Fund an investment ledger, including

                    amortized bond and foreign dollar denominated costs

                    where applicable;

               c.   Maintain for each Fund all records relating to the

                    Fund's income and expenses;

               d.   Provide for the daily valuation of each Fund's

                    portfolio securities and the computation of each Fund's

                    daily net asset value per share.  Such daily valuations

                    shall be made in accordance with the valuation policies

                    established by each of the Fund's Board of Directors

                    including, but not limited to, the utilization of such

                    pricing valuation sources and/or pricing services as

                    determined by the Boards.  Price Associates shall have

                    no liability for any losses or damages incurred by the

                    Fund as a result of erroneous portfolio security

                    evaluations provided by such designated sources and/or 



















          PAGE 6

                    pricing services; provided that, Price Associates

                    reasonably believes the prices are accurate, has

                    adhered to its normal verification control procedures,

                    and has otherwise met the standard of care as set forth

                    in Article G of this Agreement;

               e.   Provide daily cash flow and transaction status

                    information to each Fund's adviser;

               f.   Prepare for each Fund such financial information that

                    is reasonably necessary for shareholder reports,

                    reports to the Board of Directors and to the officers

                    of the Fund, and reports to the Securities and Exchange

                    Commission and the Internal Revenue Service and other

                    Federal and state regulatory agencies;

               g.   Provide each Fund with such advice that may be

                    reasonably necessary to properly account for all

                    financial transactions and to maintain the Fund's

                    accounting procedures and records so as to insure

                    compliance with generally accepted accounting and tax

                    practices and rules; 

               h.   Maintain for each Fund all records that may be

                    reasonably required in connection with the audit

                    performed by each Fund's independent accountant, the

                    Securities and Exchange Commission, the Internal 



















          PAGE 7

                    Revenue Service or such other Federal or state

                    regulatory agencies; and

               i.   Cooperate with each Fund's independent public

                    accountants and take all reasonable action in the

                    performance of its obligations under the Agreement to

                    assure that the necessary information is made available

                    to such accountants for the expression of their opinion

                    without any qualification as to the scope of their

                    examination including, but not limited to, their

                    opinion included in each such Fund's annual report on

                    Form N-SAR and annual amendment to Form N-1A.

          B.   Fees and Out-of-Pocket Expenses

               Each Fund shall pay to Price Associates for its Accounting

          Services hereunder, fees as set forth in the Schedule attached

          hereto.  In addition, each Fund will reimburse Price Associates

          for out-of-pocket expenses such as postage, printed forms, voice

          and data transmissions, record retention, disaster recovery,

          third party vendors, equipment leases and other similar items as

          may be agreed upon between Price Associates and the Fund.  Some

          invoices will contain costs for both the Funds and other funds

          services by Price Associates.  In these cases, a reasonable

          allocation methodology will be used to allocate these costs to

          the Funds.



















          PAGE 8

          C.   Representations and Warrantees of Price Associates

               Price Associates represents and warrants to the Fund that:

               1.   It is a corporation duly organized and existing in good

          standing under the laws of Maryland.

               2.   It is duly qualified to carry on its business in

          Maryland.

               3.   It is empowered under applicable laws and by its

          charter and By-Laws to enter into and perform this Agreement.

               4.   All requisite corporate proceedings have been taken to

          authorize it to enter into and perform this Agreement.

               5.   It has, and will continue to have, access to the

          necessary facilities, equipment and personnel to perform its

          duties and obligations under this Agreement.

          D.   Representations and Warrantees of the Fund

               The Fund represents and warrants to Price Associates that:

               1.   It is a corporation or business trust, as the case may

          be, duly organized and existing and in good standing under the

          laws of Maryland or Massachusetts, as the case may be.

               2.   It is empowered under applicable laws and by its

          Articles of Incorporation or Declaration of Trust, as the case

          may be, and By-Laws have been taken to authorize it to enter into

          and perform this Agreement.





















          PAGE 9

               3.   All proceedings required by said Articles of

          Incorporation or Declaration of Trust, as the case may be, and

          By-Laws have been taken to authorize it to enter into and perform

          this Agreement.

          E.   Ownership of Software and Related Material

               All computer programs, magnetic tapes, written procedures,

          and similar items purchased and/or developed and used by Price

          Associates in performance of the Agreement shall be the property

          of Price Associates and will not become the property of the

          Funds.

          F.   Quality Service Standards

               Price Associates and the Fund may, from time to time, agree

          to certain quality service standards, with respect to Price

          Associates' services hereunder.

          G.   Standard of Care/Indemnification

          Notwithstanding anything to the contrary in this Agreement:

               1.    Price Associates shall not be liable to any Fund for

          any act or failure to act by it or its agents or subcontractors

          on behalf of the Fund in carrying or attempting to carry out the

          terms and provisions of the Agreement provided Price Associates

          has acted in good faith and without negligence or willful

          misconduct and selected and monitored the performance of its

          agents and subcontractors with reasonable care.



















          PAGE 10

               2.   The Fund shall indemnify and hold Price Associates

          harmless from and against all losses, costs, damages, claims,

          actions, and expenses, including reasonable expenses for legal

          counsel, incurred by Price Associates resulting from:  (i) any

          action or omission by Price Associates or its agents or

          subcontractors in the performance of their duties hereunder; (ii)

          Price Associates acting upon instructions believed by it to have

          been executed by a duly authorized officer of the Fund; or (iii)

          Price Associates acting upon information provided by the Fund in

          form and under policies agreed to by Price Associates and the

          Fund.  Price Associates shall not be entitled to such

          indemnification in respect of actions or omissions constituting

          negligence or willful misconduct of Price Associates or where

          Price Associates has not exercised reasonable care in selecting

          or monitoring the performance of its agents or subcontractors.

               3.    Price Associates shall indemnify and hold harmless the

          Fund from all losses, costs, damages, claims, actions and

          expenses, including reasonable expenses for legal counsel,

          incurred by the Fund resulting from the negligence or willful

          misconduct of Price Associates or which result from Price

          Associates' failure to exercise reasonable care in selecting or

          monitoring the performance of its agents or subcontractors.  The

          Fund shall not be entitled to such indemnification with respect 



















          PAGE 11

          to actions or omissions constituting negligence or willful

          misconduct of such Fund or its agents or subcontractors; unless

          such negligence or misconduct is attributable to Price

          Associates. 

          4.   In the event either party is unable to perform its

          obligations under the terms of this Agreement because of acts of

          God, strikes or other causes reasonably beyond its control, such

          party shall not be liable to the other party for any loss, cost,

          damage, claim, action or expense resulting from such failure to

          perform or otherwise from such causes.  

               5.   In order that the indemnification provisions contained

          in this Article F shall apply, upon the assertion of a claim for

          which either party may be required to indemnify the other, the

          party seeking indemnification shall promptly notify the other

          party of such assertion, and shall keep the other party advised

          with respect to all developments concerning such claim.  The

          party who may be required to indemnify shall have the option to

          participate with the party seeking indemnification in the defense

          of such claim, or to defend against said claim in its own name or

          in the name of the other party.  The party seeking

          indemnification shall in no case confess any claim or make any

          compromise in any case in which the other party may be required 





















          PAGE 12

          to indemnify it except with the other party's prior written

          consent.

               6.   Neither party to this Agreement shall be liable to the

          other party for consequential damages under any provision of this

          Agreement.

          H.   Dual Interests

               It is understood that some person or persons may be

          directors, officers, or shareholders of both the Fund and Price

          Associates (including Price Associates' affiliates), and that the

          existence of any such dual interest shall not affect the validity

          of this Agreement or of any transactions hereunder except as

          otherwise provided by a specific provision of applicable law.

          I.   Documentation

               As requested by Price Associates, the Fund shall promptly

          furnish to Price Associates such documents as it may reasonably

          request and as are necessary for Price Associates to carry out

          its responsibilities hereunder.

          J.   Recordkeeping/Confidentiality

               1.   Price Associates shall keep records relating to the

          services to be performed hereunder, in the form and manner as it

          may deem advisable, provided that Price Associates shall keep all























          PAGE 13

          records in such form and in such manner as required by applicable

          law, including the Investment Company Act of 1940 ("the Act") and

          the Securities Exchange Act of 1934 ("the '34 Act").

               2.   Price Associates and the Fund agree that all books,

          records, information and data pertaining to the business of the

          other party which are exchanged or received pursuant to the

          negotiation or the carrying out of this Agreement shall remain

          confidential, and shall not be voluntarily disclosed to any other

          person, except:  (a) after prior notification to and approval in

          writing by the other party hereto, which approval shall not be

          unreasonably withheld and may not be withheld where Price

          Associates or Fund may be exposed to civil or criminal contempt

          proceedings for failure to comply; (b) when requested to divulge

          such information by duly constituted governmental authorities; or

          (c) after so requested by the other party hereto.

          K.   Compliance With Governmental Rules and Regulations

               Except as otherwise provided in the Agreement and except for

          the accuracy of information furnished to the Funds by Price

          Associates, each Fund assumes full responsibility for the

          preparation, contents and distribution of its prospectuses, and

          for complying with all applicable requirements of the Act, the

          '34 Act, the Securities Act of 1933 (the "33 Act"), and any laws,





















          PAGE 14

          rules and regulations of governmental authorities having

          jurisdiction over the Funds.  

          L.   Term and Termination of Agreement

               1.   This Agreement shall run for a period of one (1) year

          from the date first written above and will be renewed from year

          to year thereafter unless terminated by either party as provided

          hereunder.

               2.   This Agreement may be terminated by the Fund upon sixty

          (60) days' written notice to Price Associates; and by Price

          Associates, upon three hundred sixty-five (365) days' writing

          notice to the Fund.

               3.   Upon termination hereof, the Fund shall pay to Price

          Associates such compensation as may be due as of the date of such

          termination, and shall likewise reimburse for out-of-pocket

          expenses related to its services hereunder.

          M.   Notice

               Any notice as required by this Agreement shall be

          sufficiently given (i) when sent to an authorized person of the

          other party at the address of such party set forth above or at

          such other address as such party may from time to time specify in

          writing to the other party; or (ii) as otherwise agreed upon by

          appropriate officers of the parties hereto.





















          PAGE 15

          N.   Assignment

               Neither this Agreement nor any rights or obligations

          hereunder may be assigned either voluntarily or involuntarily, by

          operation of law or otherwise, by either party without the prior

          written consent of the other party, provided this shall not

          preclude Price Associates from employing such agents and

          subcontractors as it deems appropriate to carry out its

          obligations set forth hereunder.

          O.   Amendment/Interpretive Provisions

               The parties by mutual written agreement may amend this

          Agreement at any time.  In addition, in connection with the

          operation of this Agreement, Price Associates and the Fund may

          agree from time to time on such provisions interpretive of or in

          addition to the provisions of this Agreement as may in their

          joint opinion be consistent with the general tenor of this

          Agreement.  Any such interpretive or additional provisions are to

          be signed by all parties and annexed hereto, but no such

          provision shall contravene any applicable Federal or state law or

          regulation and no such interpretive or additional provision shall

          be deemed to be an amendment of this Agreement.

























          PAGE 16

          P.   Further Assurances

               Each party agrees to perform such further acts and execute

          such further documents as are necessary to effectuate the

          purposes hereof.

          Q.   Maryland Law to Apply

               This Agreement shall be construed and the provisions thereof

          interpreted under and in accordance with the laws of Maryland.

          R.   Merger of Agreement

               This Agreement, including the attached Appendices and

          Schedules supersedes any prior agreement with respect to the

          subject hereof, whether oral or written.

          S.   Counterparts

               This Agreement may be executed by the parties hereto on any

          number of counterparts, and all of said counterparts taken

          together shall be deemed to constitute one and the same

          instruments.

          T.   The Parties

               All references herein to "the Fund" are to each of the Funds

          listed on Appendix A individually, as if this Agreement were

          between such individual Fund and Price Associates.  In the case

          of a series Fund or trust, all references to "the Fund" are to

          the individual series or portfolio of such Fund or trust, or to

          such Fund or trust on behalf of the individual series or 



















          PAGE 17

          portfolio, as appropriate.  The "Fund" also includes any T. Rowe

          Price Funds which may be established after the execution of this

          Agreement.  Any reference in this Agreement to "the parties"

          shall mean Price Associates and such other individual Fund as to

          which the matter pertains.

          U.   Directors, Trustees and Shareholders and Massachusetts

          Business Trust

               It is understood and is expressly stipulated that neither

          the holders of shares in the Fund nor any Directors or Trustees

          of the Fund shall be personally liable hereunder.With respect to

          any Fund which is a party to this Agreement and which is

          organized as a Massachusetts business trust, the term "Fund"

          means and refers to the trustees from time to time serving under

          the applicable trust agreement (Declaration of Trust) of such

          Trust as the same may be amended from time to time.  It is

          expressly agreed that the obligations of any such Trust hereunder

          shall not be binding upon any of the trustees, shareholders,

          nominees, officers, agents or employees of the Trust, personally,

          but bind only the trust property of the Trust, as provided in the

          Declaration of Trust of the Trust.  The execution and delivery of

          this Agreement has been authorized by the trustees and signed by

          an authorized officer of the Trust, acting as such, and neither

          such authorization by such Trustees nor such execution and 



















          PAGE 18

          delivery by such officer shall be deemed to have been made by any

          of them, but shall bind only the trust property of the Trust as

          provided in its Declaration of Trust.

          V.   Captions

               The captions in the Agreement are included for convenience

          of reference only and in no way define or limit any of the

          provisions hereof or otherwise affect their construction or

          effect.

               IN WITNESS WHEREOF, the parties hereto have caused this

          Agreement to be executed in their names and on their behalf under

          their seals by and through their duly authorized officers.


          DATED: ______________________     T. ROWE PRICE ASSOCIATES, INC.

          ATTEST:

          /s/Barbara A. Van Horn                /s/Alvin M. Younger, Jr.
          ______________________________    BY: __________________________
          Barbara A. Van Horn,                  Managing Director
          Assistant Secretary

































          PAGE 19
                          T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                          FUND, INC. 

                          T. ROWE PRICE BALANCED FUND, INC.

                          T. ROWE PRICE BLUE CHIP GROWTH FUND

                          T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
                          California Tax-Free Bond Fund
                          California Tax-Free Money Fund

                          T. ROWE PRICE CAPITAL APPRECIATION FUND

                          T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                          T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                          T. ROWE PRICE EQUITY INCOME FUND

                          T. ROWE PRICE EQUITY SERIES, INC.
                          T. Rowe Price Equity Income Portfolio
                          T. Rowe Price New America Growth Portfolio
                          T. Rowe Price Personal Strategy Balanced
                          Portfolio

                          T. ROWE PRICE FIXED INCOME SERIES, INC.
                          T. Rowe Price Limited-Term Bond Portfolio

                          T. ROWE PRICE GNMA FUND

                          T. ROWE PRICE GROWTH & INCOME FUND, INC.

                          T. ROWE PRICE GROWTH STOCK FUND, INC.

                          T. ROWE PRICE HIGH YIELD FUND, INC.

                          T. ROWE PRICE INDEX TRUST, INC.
                          T. Rowe Price Equity Index Fund

                          INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                          Foreign Equity Fund
























          PAGE 20
                          T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                          T. Rowe Price International Bond Fund
                          T. Rowe Price International Discovery Fund
                          T. Rowe Price International Stock Fund
                          T. Rowe Price European Stock Fund
                          T. Rowe Price New Asia Fund
                          T. Rowe Price Global Government Bond Fund
                          T. Rowe Price Japan Fund
                          T. Rowe Price Short-Term Global Fund
                          T. Rowe Price Latin America Fund
                          T. Rowe Price Emerging Markets Bond Fund

                          T. ROWE PRICE INTERNATIONAL SERIES, INC.
                          T. Rowe Price International Stock Portfolio

                          T. ROWE PRICE MID-CAP GROWTH FUND

                          T. ROWE PRICE NEW AMERICA GROWTH FUND

                          T. ROWE PRICE NEW ERA FUND, INC.

                          T. ROWE PRICE NEW HORIZONS FUNDS, INC.

                          T. ROWE PRICE NEW INCOME FUND, INC.

                          T. ROWE PRICE OTC FUND, INC.
                          T. Rowe Price OTC Fund

                          T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                          T. Rowe Price Personal Strategy Balanced Fund
                          T. Rowe Price Personal Strategy Growth Fund
                          T. Rowe Price Personal Strategy Income Fund

                          T. ROWE PRICE PRIME RESERVE FUND, INC.

                          T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                          T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                          T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                          T. ROWE PRICE SPECTRUM FUND, INC.
                          Spectrum Growth Fund
                          Spectrum Income Fund





















          PAGE 21
                          T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                          Maryland Tax-Free Bond Fund
                          Maryland Short-Term Tax-Free Bond Fund
                          New York Tax-Free Bond Fund
                          New York Tax-Free Money Fund
                          New Jersey Tax-Free Bond Fund
                          Virginia Tax-Free Bond Fund
                          Virginia Short-Term Tax-Free Bond Fund
                          Florida Insured Intermediate Tax-Free Fund
                          Georgia Tax-Free Bond Fund

                          T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                          T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                          T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                          T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
                          INC.

                          T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE BOND
                          FUND, INC.

                          T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                          U.S. Treasury Intermediate Fund
                          U.S. Treasury Long-Term Fund
                          U.S. Treasury Money Fund

                          T. ROWE PRICE SUMMIT FUNDS, INC.
                          T. Rowe Price Summit Cash Reserves Fund
                          T. Rowe Price Summit Limited-Term Bond Fund
                          T. Rowe Price Summit GNMA Fund

                          T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                          T. Rowe Price Summit Municipal Money Market Fund
                          T. Rowe Price Summit Municipal Intermediate Fund
                          T. Rowe Price Summit Municipal Income Fund


          DATED:  ______________________

          ATTEST:

          /s/Patricia S. Butcher                /s/Carmen F. Deyesu
          ______________________________    BY: ___________________________
          Patricia S. Butcher,                  Carmen F. Deyesu
          Assistant Secretary


















          PAGE 22
                                      APPENDIX A


          The following Funds are parties to this Agreement, and have so

          indicated their intention to be bound by such Agreement by

          executing the Agreement on the dates indicated thereon.

                              T. Rowe Price Adjustable Rate U.S. Government
                              Fund, Inc.

                              T. Rowe Price Blue Chip Growth Fund, Inc.

                              T. Rowe Price Balanced Fund, Inc.

                              T. Rowe Price California Tax-Free Income
                              Trust on behalf of the
                                 California Tax-Free Bond Fund and
                                 California Tax-Free Money Fund

                              T. Rowe Price Capital Appreciation Fund

                              T. Rowe Price Capital Opportunity Fund, Inc.

                              T. Rowe Price Dividend Growth Fund, Inc.

                              T. Rowe Price Equity Income Fund

                              T. Rowe Price Equity Series, Inc. on behalf
                              of the:
                                 T. Rowe Price Equity Income Portfolio
                                 T. Rowe Price New America Growth Portfolio
                                 T. Rowe Price Personal Strategy Balanced
                                 Portfolio

                              T. Rowe Price Fixed Income Series, Inc. on
                              behalf of the:
                                 T. Rowe Price Limited-Term Bond Portfolio

                              T. Rowe Price GNMA Fund

                              T. Rowe Price Growth & Income Fund, Inc.

                              T. Rowe Price Growth Stock Fund, Inc.

                              T. Rowe Price High Yield Fund, Inc.


















          PAGE 23

                              T. Rowe Price Index Trust, Inc. on behalf of
                              the: 
                                 T. Rowe Price Equity Index Fund

                              Institutional International Funds, Inc. on
                              behalf of the:
                                 Foreign Equity Fund

                              T. Rowe Price International Equity Fund, Inc.

                              T. Rowe Price International Funds, Inc. on
                              behalf of the:
                                 T. Rowe Price International Bond Fund
                                 T. Rowe Price International Stock Fund
                                 T. Rowe Price International Discovery Fund
                                 T. Rowe Price European Stock Fund
                                 T. Rowe Price New Asia Fund
                                 T. Rowe Price Global Government Bond Fund
                                 T. Rowe Price Japan Fund
                                 T. Rowe Price Short-Term Global Fund
                                 T. Rowe Price Latin American Fund
                                 T. Rowe Price Emerging Markets Bond Fund

                              T. Rowe Price Mid-Cap Growth Fund

                              T. Rowe Price New America Growth Fund

                              T. Rowe Price New Era Fund, Inc.

                              T. Rowe Price New Horizons Fund, Inc.

                              T. Rowe Price New Income Fund, Inc.

                              T. Rowe Price OTC Fund, Inc. on behalf of
                              the:
                                 T. Rowe Price OTC Fund

                              T. Rowe Price Prime Reserve Fund, Inc.

                              T. Rowe Price Science & Technology Fund, Inc.

                              T. Rowe Price Short-Term Bond Fund, Inc.

                              T. Rowe Price Small-Cap Value Fund, Inc.




















          PAGE 24

                              T. Rowe Price Spectrum Fund, Inc. on behalf
                              of the:
                                 Spectrum Growth Fund
                                 Spectrum Income Fund

                              T. Rowe Price State Tax-Free Income Trust on
                              behalf of the:
                                 Maryland Tax-Free Bond Fund,
                                 Maryland Short-Term Tax-Free Bond Fund
                                 New York Tax-Free Bond Fund and
                                 New York Tax-Free Money Fund
                                 New Jersey Tax-Free Bond Fund
                                 Virginia Tax-Free Bond Fund
                                 Virginia Short-Term Tax-Free Bond Fund
                                 Florida Insured Intermediate Tax-Free Bond
                                 Fund
                                 Georgia Tax-Free Bond Fund

                              T. Rowe Price Tax-Exempt Money Fund, Inc.

                              T. Rowe Price Tax-Free Insured Intermediate
                              Bond Fund, Inc.

                              T. Rowe Price Tax-Free High Yield Fund, Inc.

                              T. Rowe Price Tax-Free Income Fund, Inc.

                              T. Rowe Price Tax-Free Short-Intermediate
                              Fund, Inc.

                              T. Rowe Price U.S. Treasury Funds, Inc. on
                              behalf of the:
                                 U.S. Treasury Intermediate Fund
                                 U.S. Treasury Long-Term Fund
                                 U.S. Treasury Money Fund

                              T. Rowe Price Summit Funds, Inc. on behalf of
                              the:
                                 T. Rowe Price Summit Cash Reserves Fund
                                 T. Rowe Price Summit Limited-Term Bond
                                 Fund
                                 T. Rowe Price Summit GNMA Fund






















          PAGE 25
                              T. Rowe Price Summit Municipal Funds, Inc. on
                              behalf of the:
                                 T. Rowe Price Summit Municipal Money
                                 Market Fund
                                 T. Rowe Price Summit Municipal
                                 Intermediate Fund
                                 T. Rowe Price Summit Municipal Income Fund

                                 T. Rowe Price Value Fund, Inc.
























































          PAGE 26
                        FUND ACCOUNTING SERVICES FEE SCHEDULE

                                       Between

                            T. ROWE PRICE ASSOCIATES, INC.

                                         And

                               THE T. ROWE PRICE FUNDS



                         January 1, 1995 to December 31, 1995




















































          PAGE 27
                              FUND ACCOUNTING SERVICES 
                                  1995 FEE SCHEDULE


               A.   Fee Structure

                    1.   Base Fee
                         Domestic Funds                  $60,000 each
                         International Funds            $100,000 each
                         Spectrum Funds                  $35,000 each

                         Per Fund fee for basic recordkeeping
                         and financial reporting

                    2.   Individual Fund Fee

                         Total fees reflecting special     $  933,000
                         characteristics of each Fund

                    3.   Stock Lending Fee

                         Allocated to each Fund based      $   75,000
                         on ratio of net earnings from
                         stock loans

                    4.   Additional Funds

                         Domestic Funds                  $60,000 each
                         International Funds            $100,000 each
                         Spectrum Funds                  $35,000 each

               B. Total Cost Per Fund

                   Growth Stock Fund                        $  114,000
                   New Horizons Fund                            95,000
                   Equity Income Fund                           85,000
                   New Era Fund                                 72,000
                   International Stock Fund                    115,000
                   Growth & Income Fund                         85,000
                   New America Growth Fund                      70,000
                   Capital Appreciation Fund                    85,000
                   Small-Cap Value Fund                         60,000
                   Foreign Equity Fund                         105,000
                   International Discovery Fund                125,000
                   Science & Technology Fund                    60,000
                   High Yield Fund                             165,000
                   Tax-Free Income Fund                        110,000


















          PAGE 28
                   New Income Fund                             100,000
                   Tax-Free High Yield Fund                    110,000
                   European Stock Fund                         100,000
                   Equity Index Fund                            60,000
                   New Asia Fund                               110,000
                   Spectrum Growth Fund                         35,000
                   GNMA Fund                                   120,000
                   International Bond Fund                     125,000
                   Balanced Fund                                90,000
                   Maryland Bond Fund                           81,000
                   Tax-Free Short Intermediate Fund             85,000
                   Short-Term Bond Fund                        120,000
                   California Bond Fund                         72,000
                   New York Bond Fund                           72,000
                   U.S. Treasury Short-Intermediate Fund        60,000
                   U.S. Treasury Long-Term Bond Fund            60,000
                   Spectrum Income Fund                         35,000
                   Prime Reserve Fund                           85,000
                   Tax-Exempt Money Fund                        93,000
                   U.S. Treasury Money Fund                     60,000
                   California Money Fund                        67,000
                   New York Money Fund                          67,000
                   Adjustable Rate Government Fund             110,000
                   Virginia Bond Fund                           60,000
                   New Jersey Bond Fund                         60,000
                   Global Government Bond Fund                 100,000
                   OTC Fund                                     85,000
                   Japan Fund                                  100,000
                   Mid-Cap Growth Fund                          60,000
                   Short-Term Global Fund                      110,000
                   Maryland Short-Term Tax-Free Bond Fund       60,000
                   Florida Insured Intermediate Tax-Free Fund   60,000
                   Georgia Tax-Free Bond Fund                   60,000
                   Tax-Free Insured Intermediate Bond Fund      60,000
                   Blue Chip Growth Fund                        60,000
                   Dividend Growth Fund                         65,000
                   Latin America Fund                          110,000
                   Summit Cash Reserve Fund                     60,000
                   Summit Limited-Term Bond Fund                60,000
                   Summit GNMA Fund                             60,000
                   Summit Municipal Money Market Fund           60,000
                   Summit Municipal Intermediate Fund           60,000
                   Summit Municipal Income Fund                 60,000
                   International Stock Portfolio               100,000
                   Personal Strategy Income Fund                70,000
                   Equity Income Portfolio                      60,000
                   Personal Strategy Balanced Fund              70,000


















          PAGE 29
                   New America Growth Portfolio                 60,000
                   Personal Strategy Growth Fund                70,000
                   Limited-Term Bond Portfolio                  60,000


               IN WITNESS WHEREOF, T. Rowe Price Funds and T. Rowe Price
          Associates, Inc. have agreed upon this fee schedule to be
          executed in their names and on their behalf through their duly
          authorized officers:


          T. ROWE PRICE FUNDS                T. ROWE PRICE ASSOCIATES, INC.

                 /s/Carmen F. Deyesu                /s/Alvin M. Younger
          Name   _________________________   Name   ______________________
                 Carmen F. Deyesu                   Alvin M. Younger

          Title  Treasurer                   Title  Treasurer and Managing
                                                    Director

          Date   _________________________   Date   ______________________












































          PAGE 30
                                   AMENDMENT NO. 1

                                      AGREEMENT
                                       between
                            T. ROWE PRICE ASSOCIATES, INC.
                                         and
                               THE T. ROWE PRICE FUNDS
                                         for
                               FUND ACCOUNTING SERVICES

                 The Agreement for Fund Accounting Services of January 1,

          1995, between T. Rowe Price Associates, Inc. and each of the

          Parties listed on Appendix A thereto is hereby amended, as of

          January 25, 1995, by adding thereto the T. Rowe Price Emerging

          Markets Stock Fund, a separate series of the T. Rowe Price

          International Funds, Inc.

                             T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                             FUND, INC.

                             T. ROWE PRICE BALANCED FUND, INC.

                             T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                             T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
                             TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                             T. ROWE PRICE CAPITAL APPRECIATION FUND

                             T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                             T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                             T. ROWE PRICE EQUITY INCOME FUND

                             T. ROWE PRICE EQUITY SERIES, INC.
                             T. Rowe Price Equity Income Portfolio
                             T. Rowe Price New America Growth Portfolio
                             T. Rowe Price Personal Strategy Balanced
                             Portfolio


















          PAGE 31

                             T. ROWE PRICE GNMA FUND

                             T. ROWE PRICE GROWTH & INCOME FUND, INC.

                             T. ROWE PRICE GROWTH STOCK FUND, INC.

                             T. ROWE PRICE HIGH YIELD FUND, INC.

                             T. ROWE PRICE INDEX TRUST, INC.
                             T. Rowe Price Equity Index Fund

                             INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                             T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.

                             T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund
                             T. Rowe Price Japan Fund
                             T. Rowe Price Short-Term Global Fund
                             T. Rowe Price Latin America Fund
                             T. Rowe Price Emerging Markets Bond Fund
                             T. Rowe Price Emerging Markets Stock Fund

                             T. ROWE PRICE INTERNATIONAL SERIES, INC.
                             T. Rowe Price International Stock Portfolio

                             T. ROWE PRICE MID-CAP GROWTH FUND

                             T. ROWE PRICE NEW AMERICA GROWTH FUND

                             T. ROWE PRICE NEW ERA FUND, INC.

                             T. ROWE PRICE NEW HORIZONS FUNDS, INC.

                             T. ROWE PRICE NEW INCOME FUND, INC.

                             T. ROWE PRICE OTC FUND, INC.
                             T. Rowe Price OTC Fund




















          PAGE 32
                             T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                             T. Rowe Price Personal Strategy Balanced Fund
                             T. Rowe Price Personal Strategy Growth Fund
                             T. Rowe Price Personal Strategy Income Fund

                             T.ROWE PRICE PRIME RESERVE FUND, INC.

                             T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                             T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                             T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                             T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund

                             T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             Maryland Short-Term Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             New Jersey Tax-Free Bond Fund
                             Virginia Tax-Free Bond Fund
                             Virginia Short-Term Tax-Free Bond Fund
                             Florida Insured Intermediate Tax-Free Fund
                             Georgia Tax-Free Bond Fund

                             T. ROWE PRICE SUMMIT FUNDS, INC.
                             T. Rowe Price Summit Cash Reserves Fund
                             T. Rowe Price Summit Limited-Term Bond Fund
                             T. Rowe Price Summit GNMA Fund

                             T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                             T. Rowe Price Summit Municipal Money Market
                             Fund
                             T. Rowe Price Summit Municipal Intermediate
                             Fund
                             T. Rowe Price Summit Municipal Income Fund

                             T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
                             FUND, INC.

                             T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                             T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.



















          PAGE 33
                             T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                             T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                             FUND, INC.

                             T. ROWE PRICE U.S. TREASURY FUNDS, INC.       
                               
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                             T.ROWE PRICE VALUE FUND, INC.

          Attest:

          /s/Patricia S. Butcher   /s/Carmen F. Deyesu
          ________________________ ___________________________________
          Patricia S. Butcher,     By: Carmen F. Deyesu
          Assistant Secretary

          Attest:                  T. ROWE PRICE ASSOCIATES, INC.

          /s/Barbara A. Van Horn   /s/Henry H. Hopkins
          ________________________ ___________________________________
          Barbara A. Van Horn,     By: Henry H. Hopkins,
          Assistant Secretary      Managing Director




































          
 The Agreement between T. Rowe Price Retirement Plan
          Services, Inc. and the Taxable Funds, dated January 1, 1995, as


















          amended, should be inserted here.
             






          PAGE 1
                                      AGREEMENT

                                       between

                     T. ROWE PRICE RETIREMENT PLAN SERVICES, INC.

                                         and

                     EACH OF THE PARTIES INDICATED ON APPENDIX A
























































          PAGE 2
                                  TABLE OF CONTENTS


                                                                      Page

          Article A Terms of Appointment  . . . . . . . . . . . . .   2

          Article B Duties of RPS   . . . . . . . . . . . . . . . .   2
                    1.    Purchases - Retirement Plans and Retirement
                          Accounts  . . . . . . . . . . . . . . . .   2
                    2.    Retirement Plans - Redemptions to Cover
                          Distributions . . . . . . . . . . . . . .   3
                    3.    Exchanges . . . . . . . . . . . . . . . .   4
                    4.    Shares held by Retirement Accounts  . . .   4
                    5.    Books and Records . . . . . . . . . . . .   4
                    6.    Tax Information . . . . . . . . . . . . .   5
                    7.    Other Information to be furnished to the
                          Funds . . . . . . . . . . . . . . . . . .   6
                    8.    Correspondence  . . . . . . . . . . . . .   6
                    9.    Mailings/Confirmation Statements  . . . .   6
                    10.   Proxies . . . . . . . . . . . . . . . . .   6
                    11.   Form N-SAR  . . . . . . . . . . . . . . .   6
                    12.   Backup Withholding  . . . . . . . . . . .   6

          Article C Fee and Out-of-Pocket Expenses  . . . . . . . .   7
                    1.    Postage . . . . . . . . . . . . . . . . .   7
                    2.    Proxies . . . . . . . . . . . . . . . . .   7
                    3.    Communications  . . . . . . . . . . . . .   7
                    4.    Record Retention  . . . . . . . . . . . .   8
                    5.    Disaster Recovery . . . . . . . . . . . .   8

          Article D Representations and Warranties of RPS   . . . .   8

          Article E Representations and Warranties of the Fund  . .   8

          Article F Standard of Care/Indemnification  . . . . . . .   9

          Article G Dual Interests  . . . . . . . . . . . . . . . .  11

          Article H Documentation   . . . . . . . . . . . . . . . .  11

          Article I Recordkeeping/Confidentiality   . . . . . . . .  13

          Article J Ownership of Software and Related Material  . .  13





















          PAGE  3
          Article K As of Transactions  . . . . . . . . . . . . . .  13
                    1.    Reporting . . . . . . . . . . . . . . . .  14
                    2.    Liability . . . . . . . . . . . . . . . .  14

          Article L Term and Termination of Agreement   . . . . . .  16

          Article M Notice  . . . . . . . . . . . . . . . . . . . .  17

          Article N Assignment  . . . . . . . . . . . . . . . . . .  17

          Article O Amendment/Interpretive Provisions   . . . . . .  17

          Article P Further Assurances  . . . . . . . . . . . . . .  17

          Article Q Maryland Law to Apply   . . . . . . . . . . . .  18

          Article R Merger of Agreement   . . . . . . . . . . . . .  18

          Article S Counterparts  . . . . . . . . . . . . . . . . .  18

          Article T The Parties   . . . . . . . . . . . . . . . . .  18

          Article U Directors, Trustees and Shareholders and
                    Massachusetts Business Trust  . . . . . . . . .  18

          Article V Captions  . . . . . . . . . . . . . . . . . . . .  19







































          PAGE 4

             AGREEMENT, made as of the first day of January, 1995, by and

          between T. ROWE PRICE RETIREMENT PLAN SERVICES, INC., a Maryland

          corporation having its principal office and place of business at

          100 East Pratt Street, Baltimore, Maryland 21202 ("RPS"), and

          EACH FUND WHICH IS LISTED ON APPENDIX A (as such Appendix may be

          amended from time to time) and which evidences its agreement to

          be bound hereby by executing a copy of this Agreement (each Fund

          hereinafter referred to as "the Fund") whose definition may be

          found in Article T;

             WHEREAS, the Funds are named investment options under various

          tax-sheltered plans, including, but not limited to, state

          deferred compensation plans, 403(b) plans, and profit sharing,

          thrift, and money purchase pension plans for self-employed

          individuals, professional partnerships and corporations,

          (collectively referred to as "Retirement Plans"); and the Fund

          has determined that such investments of Retirement Plans in the

          Funds are in the best long-term interest of the Funds;

             WHEREAS, RPS has the capability of providing special

          services, on behalf of the Fund, for the accounts ("Retirement

          Accounts") of shareholders participating in these Retirement

          Plans;

             WHEREAS, RPS represents that it is registered with the

          Securities and Exchange Commission as a Transfer Agent under 



















          PAGE 5

          Section 17A of the Securities Exchange Act of 1934 ("the '34

          Act").

             WHEREAS, RPS may subcontract or jointly contract with other

          parties on behalf of the Funds to perform certain of the

          functions described herein, RPS may also enter into, on behalf of

          the Funds, certain banking relationships to perform various

          banking services, including, but not limited to, check deposits,

          disbursements, automatic clearing house transactions ("ACH") and

          wire transfers.  Subject to guidelines mutually agreed upon by

          the Funds and RPS, excess balances, if any, resulting from these

          banking relationships will be invested and the income therefrom

          will be used to offset fees which would otherwise be charged to

          the Funds under this Agreement.

             WHEREAS, the Fund desires to contract with RPS the foregoing

          functions and services described herein in connection with the

          Retirement Plans and Retirement Accounts;

             NOW THEREFORE, in consideration of the mutual covenants

          herein contained, the parties hereto agree as follows:

          A. Terms of Appointment

             Subject to the terms and conditions set forth in this

          Agreement, the Fund hereby employs and appoints RPS to perform

          the services and functions described herein in connection with 





















          PAGE 6

          certain Retirement Plan and Retirement Accounts as agreed upon by

          the parties.

          B. Duties of RPS:

             RPS agrees that it will perform the following services:

             1.    Purchases - Retirement Plans and Retirement Accounts

                After RPS has received monies from Retirement Plans and

             has determined the proper allocation of such monies to the

             Retirement Accounts or Retirement Plan participants

             ("Participants") based upon instructions received from

             Participants, Retirement Plans or their designees, or

             Retirement Plan Administrator(s) ("Administrator(s)"), RPS

             will, as a responsibility under the Agreement:

                a.    Transmit by check or wire the aggregate money

                      allocated to each Fund to the Fund's custodian;

                b.    In the case of a new Participant, establish and

                      maintain a Retirement Account for such Participant;

                      and

                c.    Compute the number of shares of each Fund to which

                      the Participant is entitled according to the price of

                      such Fund shares as provided by such Fund for

                      purchases made at that time and date, and credit each

                      such Account with the number of shares of the Fund so

                      purchased. 



















          PAGE 7

             2.    Retirement Plans - Redemptions to Cover Distributions.  

                After RPS has received instructions from the Administrator

             regarding distributions to be made to Participants or their

             designated beneficiaries from Funds designated as investment

             options under the Retirement Plan, RPS will, as a

             responsibility under the Agreement:

                a.    Compute the amount due for shares to be redeemed from

                      each Retirement Account or compute the number of

                      shares to be redeemed from each such Retirement

                      Account for such distributions and the total number

                      of all shares of each Fund to be redeemed in

                      accordance with the price per share at that time and

                      date of such Fund as calculated and provided by the

                      Fund.  After such computation, inform the Fund of the

                      amount necessary to be redeemed.  Distribute to

                      Participants or their designated beneficiaries the

                      amount to be disbursed.

                b.    After RPS has received instructions from the

                      Administrator regarding disbursements to be made

                      regarding the payment of fees due the Administrator,

                      or other persons including RPS, RPS will, as a

                      responsibility under this Agreement:





















          PAGE 8

                   i.    Compute the number of shares to be redeemed from

                         each Retirement Account to pay for such

                         disbursements and the total number of all shares

                         to be redeemed in accordance with the price per

                         share at that time and date, of such Fund as

                         calculated and provided by the Fund;

                   ii.   Effect the necessary redemption from the Fund's

                         custodian to cover such disbursements; and

                   iii.  Mail to the Administrator or such other person as

                         designated by the Administrator the amount to be

                         disbursed.

                c.    Other Provisions

                   i.    If any instruction tendered by an Administrator to

                         redeem shares in a Retirement Account is not

                         satisfactory to RPS, RPS shall promptly notify the

                         Administrator of such fact together with the

                         reason therefor;

                   ii.   The authority of RPS to perform its

                         responsibilities under Paragraph B(2) with respect

                         to each Fund shall be suspended upon receipt of

                         notification by such Fund of the suspension of the

                         determination of the Fund's net asset value per 





















          PAGE 9

                         share and shall remain suspended until proper

                         notification; and

                   iii.  The Fund will promptly inform RPS of the

                         declaration of any dividend or distribution on

                         account of the capital stock of any Fund so that

                         RPS may properly credit income and capital gain

                         payments to each Retirement Account.

             3.    Exchanges

                Effect exchanges of shares of the Funds upon receipt of

             appropriate instructions from the Administrator and/or

             Participant.  

             4.    Shares held by Retirement Accounts will be

          Noncertificate Shares

                RPS will have neither responsibility nor authority to

             issue stock certificates evidencing ownership of Fund shares

             held by Participants.  All shares held in Retirement Accounts

             maintained by RPS shall be noncertificated shares.

             5.    Books and Records

                RPS shall maintain records showing for each Retirement

             Plan or Retirement Account, the following:

                a.    Names, addresses and tax identification numbers, when

          provided;

                b.    Number of shares held;



















          PAGE 10

                c.    Historical information regarding the account of each

                      Participant and/or Retirement Plan, including

                      dividends and distributions invested in shares;

                d.    Pertinent information regarding the establishment and

                      maintenance of Retirement Plans and Retirement

                      Accounts necessary to properly administer each

                      account.

                e.    Any instructions from a Participant or Administrator

                      including, all forms furnished by the Fund and

                      executed by a Participant with respect to elections

                      with respect to payment options in connection with

                      the redemption of shares; or distribution elections,

                      if applicable; and

                f.    Any information required in order for RPS to perform

                      the calculations contemplated under this Agreement.

                Any such records maintained pursuant to Rule 31a-1 under

             the Investment Company Act of 1940 ("the Act") will be

             preserved for the periods prescribed in Rule 31a-2

             thereunder.  Disposition of such records after such

             prescribed periods shall be as mutually agreed upon from time

             to time by RPS and the Funds.  The retention of such records,

             which may be inspected by the Fund at reasonable times, shall

             be at the expense of the Funds.  All records maintained by 



















          PAGE 11

             RPS in connection with the performance of its duties under

             this Agreement will remain the property of the Funds and, in

             the event of termination of this Agreement, will be delivered

             to the Fund as of the date of termination or at such other

             time as may be mutually agreed upon.

             6.    Tax Information

                RPS shall also prepare and file with appropriate federal

             and state agencies, such information returns and reports as

             required by applicable Federal and State statutes relating to

             redemptions effected in Retirement Accounts which constitute

             reportable distributions.  RPS will also prepare and submit

             to Participants, such reports containing information as is

             required by applicable Federal and State law.

             7.    Other Information to be furnished to the Funds

                RPS will furnish to the Fund, such information, including

             shareholder lists and statistical information as may be

             agreed upon from time to time between RPS and the Fund.

             8.    Correspondence  

                RPS will promptly and fully answer correspondence from

             Administrators and in some cases, Participants, relating to

             Retirement Accounts, transfer agent procedures, and such

             other correspondence as may from time to time be mutually

             agreed upon with the Funds.  Unless otherwise instructed, 



















          PAGE 12

             copies of all correspondence will be retained by RPS in

             accordance with applicable law.

             9.    Mailings/Confirmation Statements

                RPS will be responsible for mailing all confirmations and

             other enclosures and mailings, as requested by the

             Administrators and as may be required of the Funds by

             applicable Federal or state law.

             10.   Proxies  

                RPS shall monitor the mailing of proxy cards and other

             material supplied to it by the Fund in connection with

             shareholder meetings of the Fund and shall coordinate the

             receipt, examination and tabulation of returned proxies and

             the certification of the vote to the Fund.

             11.   Form N-SAR  

                RPS shall maintain such records, if any, as shall enable

             the Fund to fulfill the requirements of Form N-SAR.

             12.   Withholding

                The Fund and RPS shall agree to procedures to be followed

             with respect to RPS's responsibilities in connection with

             compliance for federal withholding for Participants.

























          PAGE 13

          C. Fees and Out-of-Pocket Expenses

             Each Fund shall pay to RPS for its services hereunder fees

          computed as set forth in the Schedule attached hereto.  Except as

          provided below, RPS will be responsible for all expenses relating

          to the providing of services.  Each Fund, however, will reimburse

          RPS for the following out-of-pocket expenses and charges incurred

          in providing services:

             1.    Postage.  The cost of postage and freight for mailing

                   materials to Participants, or their agents, including

                   overnight delivery, UPS and other express mail services

                   and special courier services required to transport mail

                   between RPS locations and mail processing vendors.

             2.    Proxies.  The cost to mail proxy cards and other

                   material supplied to it by the Fund and costs related to

                   the receipt, examination and tabulation of returned

                   proxies and the certification of the vote to the Fund.

             3.    Communications

                a.    Print.  The printed forms used internally and

                      externally for documentation and processing

                      Participant, or their agent's, inquiries and

                      requests; paper and envelope supplies for letters,

                      notices, and other written communications sent to

                      Administrators and Participants, or their agents.



















          PAGE 14

                b.    Print & Mail House.  The cost of internal and third

                      party printing and mail house services, including

                      printing of statements and reports.

                c.    Voice and Data.  The cost of equipment (including

                      associated maintenance), supplies and services used

                      for communicating to and from the Participants, or

                      their agents, the Fund's transfer agent, other Fund

                      offices, and other agents of either the Fund or RPS. 

                      These charges shall include:

                   o  telephone toll charges (both incoming and outgoing,

                      local, long distance and mailgrams); and

                   o  data and telephone lines and associated equipment

                      such as modems, multiplexers, and facsimile

                      equipment.

             4.    Record Retention.  The cost of maintenance and supplies

                   used to maintain, microfilm, copy, record, index,

                   display, retrieve, and store, in microfiche or microfilm

                   form, documents and records.

             5.    Disaster Recovery.  The cost of services, equipment,

                   facilities and other charges necessary to provide

                   disaster recovery for any and all services listed in

                   this Agreement.





















          PAGE 15

          D. Representations and Warranties of RPS

             RPS represents and warrants to the Fund that:

             1.    It is a corporation duly organized and existing and in

             good standing under the laws of Maryland.

             2.    It is duly qualified to carry on its business in

             Maryland.

             3.    It is empowered under applicable laws and by its charter

             and by-laws to enter into and perform this Agreement.

             4.    All requisite corporate proceedings have been taken to

             authorize it to enter into and perform this Agreement.

             5.    It has and will continue to have access to the necessary

             facilities, equipment and personnel to perform its duties and

             obligations under this Agreement.

             6.    It is registered with the Securities and Exchange

             Commission as a Transfer Agent pursuant to Section 17A of the

             '34 Act.

          E. Representations and Warranties of the Fund

             The Fund represents and warrants to RPS that:

             1.    It is a corporation or business trust duly organized and

             existing and in good standing under the laws of Maryland, or

             Massachusetts, as the case may be.

             2.    It is empowered under applicable laws and by its

             Articles of Incorporation or Declaration of Trust, as the 



















          PAGE 16

             case may be, and By-Laws to enter into and perform this

             Agreement.

             3.    All proceedings required by said Articles of

             Incorporation or Declaration of Trust, as the case may be,

             and By-Laws have been taken to authorize it to enter into and

             perform this Agreement.

             4.    It is an investment company registered under the Act.

             5.    A registration statement under the Securities Act of

             1933 ("the '33 Act") is currently effective and will remain

             effective, and appropriate state securities law filing have

             been made and will continue to be made, with respect to all

             shares of the Fund being offered for sale.

          F. Standard of Care/Indemnification

             Notwithstanding anything to the contrary in this Agreement:

             1.     RPS shall not be liable to the Fund for any act or

             failure to act by it or its agents or subcontractors on

             behalf of the Fund in carrying or attempting to carry out the

             terms and provisions of this Agreement provided RPS has acted

             in good faith and without negligence or willful misconduct

             and selected and monitored the performance of its agents and

             subcontractors with reasonable care.

             2.    The Fund shall indemnify and hold RPS harmless from and

             against all losses, costs, damages, claims, actions and 



















          PAGE 17

             expenses, including reasonable expenses for legal counsel,

             incurred by RPS resulting from: (i) any action or omission by

             RPS or its agents or subcontractors in the performance of

             their duties hereunder; (ii) RPS acting upon instructions

             believed by it to have been executed by a duly authorized

             officer of the Fund; or (iii) RPS acting upon information

             provided by the Fund in form and under policies agreed to by

             RPS and the Fund.  RPS shall not be entitled to such

             indemnification in respect of actions or omissions

             constituting negligence or willful misconduct of RPS or where

             RPS has not exercised reasonable care in selecting or

             monitoring the performance of its agents or subcontractors.

             3.    Except as provided in Article K of this Agreement, RPS

             shall indemnify and hold harmless the Fund from all losses,

             costs, damages, claims, actions and expenses, including

             reasonable expenses for legal counsel, incurred by the Fund

             resulting from negligence or willful misconduct of RPS or

             which result from RPS' failure to exercise reasonable care in

             selecting or monitoring the performance of its agents or

             subcontractors.  The Fund shall not be entitled to such

             indemnification in respect of actions or omissions 























          PAGE 18

             constituting negligence or willful misconduct of such Fund or

             its agents or subcontractors; unless such negligence or

             misconduct is attributable to RPS.

             4.    In determining RPS' liability, an isolated error or

             omission will normally not be deemed to constitute negligence

             when it is determined that:

               o    RPS had in place "appropriate procedures".

               o    the employees responsible for the error or omission had

                    been reasonably trained and were being appropriately

                    monitored; and

               o    the error or omission did not result from wanton or

                    reckless conduct on the part of the employees.

               It is understood that RPS is not obligated to have in place

               separate procedures to prevent each and every conceivable

               type of error or omission.  The term "appropriate

               procedures" shall mean procedures reasonably designed to

               prevent and detect errors and omissions.  In determining the

               reasonableness of such procedures, weight will be given to

               such factors as are appropriate, including the prior

               occurrence of any similar errors or omissions when such

               procedures were in place and transfer agent industry

               standards in place at the time of the occurrence.





















          PAGE 19

               5.   In the event either party is unable to perform its

               obligations under the terms of this Agreement because of

               acts of God, strikes or other causes reasonably beyond its

               control, such party shall not be liable to the other party

               for any loss, cost, damage, claims, actions or expense

               resulting from such failure to perform or otherwise from

               such causes.  

               6.   In order that the indemnification provisions contained

               in this Article F shall apply, upon the assertion of a claim

               for which either party may be required to indemnify the

               other, the party seeking indemnification shall promptly

               notify the other party of such assertion, and shall keep the

               other party advised with respect to all developments

               concerning such claim.  The party who may be required to

               indemnify shall have the option to participate with the

               party seeking indemnification in the defense of such claim,

               or to defend against said claim in its own name or in the

               name of the other party.  The party seeking indemnification

               shall in no case confess any claim or make any compromise in

               any case in which the other party may be required to 

























          PAGE 20

               indemnify it except with the other party's prior written

               consent.

               7.   Neither party to this Agreement shall be liable to the

               other party for consequential damages under any provision of

               this Agreement.

          G.   Dual Interests

               It is understood that some person or persons may be

          directors, officers, or shareholders of both RPS and the Fund and

          that the existence of any such dual interest shall not affect the

          validity of this Agreement or of any transactions hereunder

          except as otherwise provided by a specific provision of

          applicable law.

          H.   Documentation

               1.   As requested by RPS, the Fund shall promptly furnish to

          RPS the following:

                a.    A certified copy of the resolution of the

                      Directors/Trustees of the Fund authorizing the

                      appointment of RPS and the execution and delivery of

                      this Agreement;

                b.    A copy of the Articles of Incorporation or

                      Declaration of Trust, as the case may be, and By-Laws

                      of the Fund and all amendments thereto;





















          PAGE 21

                c.    Specimens of all forms of outstanding and new

                      stock/share certificates in the forms approved by the

                      Board of Directors/Trustees of the Fund with a

                      certificate of the Secretary of the Fund as to such

                      approval;

                d.    All account application forms and other documents

                      relating to shareholders' accounts;

                e.    An opinion of counsel for the Fund with respect to

                      the validity of the stock, the number of Shares

                      authorized, the status of redeemed Shares, and the

                      number of Shares with respect to which a Registration

                      Statement has been filed and is in effect; and

                f.    A copy of the Fund's current prospectus.

             The delivery of any such document for the purpose of any

          other agreement to which the Fund and RPS are or were parties

          shall be deemed to be delivery for the purposes of this

          Agreement.

             2.    As requested by RPS, the Fund will also furnish from

             time to time the following documents:

                a.    Each resolution of the Board of Directors/Trustees of

                      the Fund authorizing the original issue of its

                      shares;





















          PAGE 22

                b.    Each Registration Statement filed with the Securities

                      and Exchange Commission and amendments and orders

                      thereto in effect with respect to the sale of shares

                      with respect to the Fund;

                c.    A certified copy of each amendment to the Articles of

                      Incorporation or Declaration of Trust, and the

                      By-Laws of the Fund;

                d.    Certified copies of each vote of the Board of

                      Directors/Trustees authorizing officers to give

                      instructions to the Fund;

                e.    Specimens of all new certificates accompanied by the

                      Board of Directors/Trustees' resolutions approving

                      such forms;

                f.    Such other documents or opinions which RPS, in its

                      discretion, may reasonably deem necessary or

                      appropriate in the proper performance of its duties;

                      and

                g.    Copies of new prospectuses issued.

             3.    RPS hereby agrees to establish and maintain facilities

             and procedures reasonably acceptable to the Fund for

             safekeeping of check forms and facsimile signature imprinting

             devices, if any, and for the preparation or use, and for

             keeping account of, such forms and devices.



















          PAGE 23

          I. Recordkeeping/Confidentiality

             1.    RPS shall keep records relating to the services to be

             performed hereunder, in the form and manner as it may deem

             advisable, provided that RPS shall keep all records in such

             form and in such manner as required by applicable law,

             including the Act and the '34 Act.

             2.    RPS and the Fund agree that all books, records,

             information and data pertaining to the business of the other

             party which are exchanged or received pursuant to the

             negotiation or the carrying out of this Agreement shall

             remain confidential, and shall not be voluntarily disclosed

             to any other person, except:  (a) after prior notification to

             and approval in writing by the other party hereto, which

             approval shall not be unreasonably withheld and may not be

             withheld where RPS or the Fund may be exposed to civil or

             criminal contempt proceedings for failure to comply; (b) when

             requested to divulge such information by duly constituted

             governmental authorities; or (c) after so requested by the

             other party hereto.

          J. Ownership of Software and Related Material

             All computer programs, magnetic tapes, written procedures and

          similar items purchased and/or developed and used by RPS in 





















          PAGE 24

          performance of the Agreement shall be the property of RPS and

          will not become the property of the Fund.

          K. As Of Transactions

             For purposes of this Article K, the term "Transaction" shall

          mean any single or "related transaction" (as defined below)

          involving the purchase or redemption of shares (including

          exchanges) that are processed at a time other than the time of

          the computation of the Fund's net asset value per share next

          computed after receipt of any such transaction order by RPS.  If

          more than one Transaction ("Related Transaction") in the Fund is

          caused by or occurs as a result of the same act or omission, such

          transactions shall be aggregated with other transactions in the

          Fund and be considered as one Transaction.

             1.    Reporting   

                RPS shall:

               a.   Utilize a system to identify all Transactions, and

                    shall compute the net effect of such Transactions upon

                    the Fund on a daily, monthly and rolling 365 day basis. 

                    The Monthly and rolling 365 day periods are hereinafter

                    referred to as ("Cumulative").

























          PAGE 25

               b.   Supply to the Fund, from time to time as mutually

                    agreed upon, a report summarizing the Transactions and

                    the daily and Cumulative net effects of such

                    Transactions both in terms of aggregate dilution and

                    loss ("Dilution") or gain and negative dilution 

                    ("Gain") experienced by the Fund, and the impact such

                    Gain or Dilution has had upon the Fund's net asset

                    value per share.

               c.   With respect to any Transaction which causes Dilution

                    to the Fund of $25,000 or more, immediately provide the

                    Fund: (i) a report identifying the Transaction and the

                    Dilution resulting therefrom, (ii) the reason such

                    Transaction was processed as described above, and (iii)

                    the action that RPS has or intends to take to prevent

                    the reoccurrence of such as of processing ("Report").

               2.   Liability

               a.   It will be the normal practice of the Fund not to hold

                    RPS liable with respect to any Transaction which causes

                    Dilution to any single Fund of less than $25,000.  RPS

                    will, however, closely monitor for each Fund the daily

                    and Cumulative Gain/Dilution which is caused by

                    Transactions of less than $25,000.  When the Cumulative





















          PAGE 26

                    Dilution to any Fund exceeds 3/10 of 1% per share, RPS,

                    in consultation with counsel to the Fund, will make

                    appropriate inquiry to determine whether it should take

                    any remedial action.  RPS will report to the Board of

                    Directors/Trustees of the Fund ("Board"), as

                    appropriate, any action it has taken.

               b.   Where a Transaction causes Dilution to a Fund of

                    $25,000 or more ("Significant Transaction"), RPS will

                    review with counsel to the Fund, the Report and the

                    circumstances surrounding the underlying Transaction to

                    determine whether the Transaction was caused by or

                    occurred as a result of a negligent act or omission by

                    RPS.  If it is determined that the Dilution is the

                    result of a negligent action or omission by RPS, RPS

                    and outside counsel for the Fund, as appropriate, will

                    negotiate settlement.  All such Significant

                    Transactions will be reported to the Board at its next

                    meeting (unless the settlement fully compensates the

                    Fund for any Dilution).  Any Significant Transaction,

                    however, causing Dilution in excess of the lesser of

                    $100,000 or a penny per share will be promptly reported

                    to the Board.  Settlement will not be entered into with





















          PAGE 27

                    RPS until approved by the Board.  The factors the Board

                    or the Funds would be expected to consider in making

                    any determination regarding the settlement of a

                    Significant Transaction would include but not be

                    limited to:

                    i.   Procedures and controls adopted by RPS to prevent

                         As Of processing;

                    ii.  Whether such procedures and controls were being

                         followed at the time of the Significant

                         Transaction;

                    iii. The absolute and relative volume of all

                         transactions processed by RPS on the day of the

                         Significant Transaction;

                    iv.  The number of Transactions processed by RPS during

                         prior relevant periods, and the net Dilution/Gain

                         as a result of all such transactions to the Fund

                         and to all other Price Funds; and

                    v.   The prior response of RPS to recommendations made

                         by the Funds regarding improvement to the Transfer

                         Agent's As Of Processing Procedures.

               c.   In determining RPS' liability with respect to a

          Significant Transaction, an isolated error or omission will normally

          not be deemed to constitute negligence when it is determined that:



















          PAGE 28

                    o  RPS had in place "appropriate procedures".

                    o  the employees responsible for the error or omission

                       had been reasonably trained and were being

                       appropriately monitored; and

                    o  the error or omission did not result from wanton or

                       reckless conduct on the part of the employees.

                    It is understood that RPS is not obligated to have in

                    place separate procedures to prevent each and every

                    conceivable type of error or omission.  The term

                    "appropriate procedures" shall mean procedures

                    reasonably designed to prevent and detect errors and

                    omissions.  In determining the reasonableness of such

                    procedures, weight will be given to such factors as are

                    appropriate, including the prior occurrence of any

                    similar errors or omissions when such procedures were

                    in place and transfer agent industry standards in place

                    at the time of the occurrence.

          L.   Term and Termination of Agreement

               1.   This Agreement shall run for a period of one (1) year

               from the date first written above and will be renewed from

               year to year thereafter unless terminated by either party as

               provided hereunder.





















          PAGE 29

               2.   This Agreement may be terminated by the Funds upon one

               hundred twenty (120) days' written notice to RPS; and by

               RPS, upon three hundred sixty-five (365) days' writing

               notice to the Fund.

               3.   Upon termination hereof, the Fund shall pay to RPS such

               compensation as may be due as of the date of such

               termination, and shall likewise reimburse for out-of-pocket

               expenses related to its services hereunder.

          M.   Notice

               Any notice as required by this Agreement shall be

          sufficiently given (i) when sent to an authorized person of the

          other party at the address of such party set forth above or at

          such other address as such party may from time to time specify in

          writing to the other party; or (ii) as otherwise agreed upon by

          appropriate officers of the parties hereto.

          N.   Assignment

               Neither this Agreement nor any rights or obligations

          hereunder may be assigned either voluntarily or involuntarily, by

          operation of law or otherwise, by either party without the prior

          written consent of the other party

























          PAGE 30

          O.   Amendment/Interpretive Provisions

               The parties by mutual written agreement may amend this

          Agreement at any time.  In addition, in connection with the

          operation of this Agreement, RPS and the Fund may agree from time

          to time on such provisions interpretive of or in addition to the

          provisions of this Agreement as may in their joint opinion be

          consistent with the general tenor of this Agreement.  Any such

          interpretive or additional provisions are to be signed by all

          parties and annexed hereto, but no such provision shall

          contravene any applicable federal or state law or regulation and

          no such interpretive or additional provision shall be deemed to

          be an amendment of this Agreement.

          P.   Further Assurances

               Each party agrees to perform such further acts and execute

          such further documents as are necessary to effectuate the

          purposes hereof.

          Q.   Maryland Law to Apply

               This Agreement shall be construed and the provisions thereof

          interpreted under and in accordance with the laws of Maryland.



























          PAGE 31

          R.   Merger of Agreement

               This Agreement, including the attached Schedule supersede

          any prior agreement with respect to the subject hereof, whether

          oral or written.

          S.   Counterparts

               This Agreement may be executed by the parties hereto on any

          number of counterparts, and all of said counterparts taken

          together shall be deemed to constitute one and the same

          instruments.

          T.   The Parties

               All references herein to "the Fund" are to each of the Funds

          listed on Appendix A individually, as if this Agreement were

          between such individual Fund and RPS.  In the case of a series

          Fund or trust, all references to "the Fund" are to the individual

          series or portfolio of such fund or trust, or to such Fund or

          trust on behalf of the individual series or portfolio, as

          appropriate.  Any reference in this Agreement to "the parties"

          shall mean RPS and such other individual Fund as to which the

          matter pertains.  The "Fund" also includes any T. Rowe Price Fund

          which may be established after the date of this Agreement.

               Any reference in this Agreement to "the parties" shall mean

          the Funds and RPS.





















          PAGE 32

          U.   Directors, Trustees and Shareholders and Massachusetts

          Business Trust

               It is understood and is expressly stipulated that neither

          the holders of shares in the Fund nor any Directors or Trustees

          of the Fund shall be personally liable hereunder.  With respect

          to any Fund which is a party to this Agreement and which is

          organized as a Massachusetts business trust, the term "Fund"

          means and refers to the trustees from time to time serving under

          the applicable trust agreement (Declaration of Trust) of such

          Trust as the same may be amended from time to time.  It is

          expressly agreed that the obligations of any such Trust hereunder

          shall not be binding upon any of the trustees, shareholders,

          nominees, officers, agents or employees of the Trust, personally,

          but bind only the trust property of the Trust, as provided in the

          Declaration of Trust of the Trust.  The execution and delivery of

          this Agreement has been authorized by the trustees and signed by

          an authorized officer of the Trust, acting as such, and neither

          such authorization by such Trustees nor such execution and

          delivery by such officer shall be deemed to have been made by any

          of them, but shall bind only the trust property of the Trust as

          provided in its Declaration of Trust.























          PAGE 33

          V.   Captions

               The captions in the Agreement are included for convenience

          of reference only and in no way define or limit any of the

          provisions hereof or otherwise affect their construction or

          effect.

               IN WITNESS WHEREOF, the parties hereto have caused this

          Agreement to be executed in their names and on their behalf under

          their seals by and through their duly authorized officers.


          T. ROWE PRICE RETIREMENT PLAN     DATED: _______________________
          SERVICES, INC.

                                            ATTEST:
               /s/Charles E. Vieth
          By:  ________________________     ________________________
               Charles E. Vieth

                         T. ROWE PRICE ADJUSTABLE RATE U.S GOVERNMENT FUND,
                         INC.

                         T. ROWE PRICE BALANCED FUND, INC.

                         T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                         T. ROWE PRICE CAPITAL APPRECIATION FUND

                         T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                         T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                         T. ROWE PRICE EQUITY INCOME FUND

                         T. ROWE PRICE GNMA FUND

                         T. ROWE PRICE GROWTH & INCOME FUND, INC.

                         T. ROWE PRICE GROWTH STOCK FUND, INC.



















          PAGE 34
                         T. ROWE PRICE HIGH YIELD FUND, INC.

                         T. ROWE PRICE INDEX TRUST, INC.
                         T. Rowe Price Equity Index Fund

                         INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                         Foreign Equity Fund

                         T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                         T. Rowe Price International Bond Fund
                         T. Rowe Price International Discovery Fund
                         T. Rowe Price International Stock Fund
                         T. Rowe Price European Stock Fund
                         T. Rowe Price New Asia Fund
                         T. Rowe Price Global Government Bond Fund
                         T. Rowe Price Japan Fund
                         T. Rowe Price Short-Term Global Fund
                         T. Rowe Price Latin America Fund
                         T. Rowe Price Emerging Markets Bond Fund

                         T. ROWE PRICE MID-CAP GROWTH FUND, INC.

                         T. ROWE PRICE OTC FUND, INC.
                         T. Rowe Price OTC Fund

                         T. ROWE PRICE NEW AMERICA GROWTH FUND

                         T. ROWE PRICE NEW ERA FUND, INC.

                         T. ROWE PRICE NEW HORIZONS FUNDS, INC.

                         T. ROWE PRICE NEW INCOME FUND, INC.

                         T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
                         T. Rowe Price Personal Strategy Balanced Fund
                         T. Rowe Price Personal Strategy Growth Fund
                         T. Rowe Price Personal Strategy Income Fund

                         T. ROWE PRICE PRIME RESERVE FUND, INC.

                         T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                         T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                         T. ROWE PRICE SMALL-CAP VALUE FUND, INC.




















          PAGE 35
                         T. ROWE PRICE SPECTRUM FUND, INC.
                         Spectrum Growth Fund
                         Spectrum Income Fund

                         T. ROWE PRICE VALUE FUND, INC.

                         T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                         U.S. Treasury Intermediate Fund
                         U.S. Treasury Long-Term Fund
                         U.S. Treasury Money Fund

                         T. ROWE PRICE SUMMIT FUNDS, INC.
                         T. Rowe Price Summit Cash Reserves Fund
                         T. Rowe Price Summit Limited-Term Bond Fund
                         T. Rowe Price Summit GNMA Fund

                         T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
                         T. Rowe Price Summit Municipal Money Market Fund
                         T. Rowe Price Summit Municipal Intermediate Fund
                         T. Rowe Price Summit Municipal Income Fund


          DATED: ______________________

          ATTEST:

                                                /s/Carmen F. Deyesu
          ______________________________    BY: __________________________
                                                Carmen F. Deyesu




































          PAGE 36
                                      APPENDIX A


          The following Funds are parties to this Agreement, and have so

          indicated their intention to be bound by such Agreement by

          executing the Agreement on the dates indicated thereon.

                              T. Rowe Price Adjustable Rate U.S. Government
                              Fund, Inc.

                              T. Rowe Price Balanced Fund, Inc.

                              T. Rowe Price Blue Chip Growth Fund, Inc.

                              T. Rowe Price Capital Appreciation Fund

                              T. Rowe Price Capital Opportunity Fund, Inc.

                              T. Rowe Price Dividend Growth Fund, Inc.

                              T. Rowe Price Equity Income Fund

                              T. Rowe Price GNMA Fund

                              T. Rowe Price Growth & Income Fund, Inc.

                              T. Rowe Price Growth Stock Fund, Inc.

                              T. Rowe Price High Yield Fund, Inc.

                              T. Rowe Price Index Trust, Inc. on behalf of
                              the
                                T. Rowe Price Equity Index Fund

                              Institutional International Funds, Inc. on
                              behalf of the
                                Foreign Equity Fund


























          PAGE 37
                              T. Rowe Price International Funds, Inc. on
                              behalf of the
                                T. Rowe Price International Bond Fund and
                                T. Rowe Price International Stock Fund
                                T. Rowe Price International Discovery Fund
                                T. Rowe Price European Stock Fund
                                T. Rowe Price New Asia Fund
                                T. Rowe Price Global Government Bond Fund
                                T. Rowe Price Japan Fund
                                T. Rowe Price Short-Term Global Fund
                                T. Rowe Price Latin America Fund
                                T. Rowe Price Emerging Markets Bond Fund

                              T. Rowe Price Mid-Cap Growth Fund, Inc.

                              T. Rowe Price New America Growth Fund

                              T. Rowe Price New Era Fund, Inc.

                              T. Rowe Price New Horizons Fund, Inc.

                              T. Rowe Price New Income Fund, Inc.

                              T. Rowe Price OTC Fund, Inc. on behalf of the
                                T. Rowe Price OTC Fund

                              T. Rowe Price Personal Strategy Funds, Inc.
                              on behalf of the
                                T. Rowe Price Personal Strategy Balanced
                                Fund
                                T. Rowe Price Personal Strategy Growth Fund
                                T. Rowe Price Personal Strategy Income Fund

                              T. Rowe Price Prime Reserve Fund, Inc.

                              T. Rowe Price Science & Technology Fund, Inc.

                              T. Rowe Price Short-Term Bond Fund, Inc.

                              T. Rowe Price Small-Cap Value Fund, Inc.

























          PAGE 38
                              T. Rowe Price Spectrum Fund, Inc. on behalf
                              of the
                                Spectrum Growth Fund
                                Spectrum Income Fund

                              T. Rowe Price Value Fund, Inc.

                              T. Rowe Price U.S. Treasury Funds, Inc. on
                              behalf of the
                                U.S. Treasury Intermediate Fund
                                U.S. Treasury Long-Term Fund
                                U.S. Treasury Money Fund

                              T. Rowe Price Summit Funds, Inc.
                                T. Rowe Price Summit Cash Reserves Fund
                                T. Rowe Price Summit Limited-Term Bond Fund
                                T. Rowe Price Summit GNMA Fund

                              T. Rowe Price Summit Municipal Funds, Inc.
                                T. Rowe Price Summit Municipal Money Market
                                Fund
                                T. Rowe Price Summit Municipal Intermediate
                                Fund
                                T. Rowe Price Summit Municipal Income Fund









































          PAGE 39
                     T. ROWE PRICE RETIREMENT PLAN SERVICES, INC.

                                     FEE SCHEDULE


          Fees for transfer agent services performed for retirement plan
          accounts serviced by T. Rowe Price Retirement Plan Services, Inc.
          ("RPS").

          Effective January 1, 1995 to December 31, 1995.

          A.   Base Fee

               A monthly base fee of $500,000 ($6,000,000 per year)
               allocated pro rata by account.

          B.   Per Participant Fee

               A monthly per participant fee of $3.583 for each active
               (non-zero balance) participant being serviced at the end of
               the month.  This fee will be allocated among the Funds based
               on the relative percentage of T. Rowe Price assets at the
               end of the month.

          C.   Per Transaction Fee

               A fee for each Account transaction will be charged at the
               rate of $.15 per transaction, except for dividend
               transactions.

          D.   Institutional Support Group (ISG) Telephone Call

               A fee of $5.24 per ISG telephone call will be charged to the
               Fund(s) involved in the telephone call.

          E.   New Participant Fee

               A one-time new participant fee of $3.31 will be charged each
               time a participant is added to the records.

          F.   Perks Fee

               Fees for PERKS plans will be $10 per account, maximum $40
               per participant, capped at 25 basis points.





















          PAGE 40
          G.   Billing Procedures

               RPS will render a monthly invoice which shall include:  the
               number of participants in existence at month-end and the
               Fund's pro rata share; the assets by Fund at month-end; the
               number of transactions recorded during the month for each
               Fund; and the number of new participants added during the
               month and the Fund's pro rata share.  RPS will render a
               separate invoice for out-of-pocket expenses for which RPS is
               entitled to reimbursement under the Agreement and the Fund's
               pro rata share. 

          H.   New Funds

               Funds added during the term of this Agreement may have their
               Maintenance and Transaction charges waived for a period of
               time agreed upon between RPS and the Funds following the
               establishment of the Fund.  Out-of-pocket expenses will be
               billed to the Fund from the Fund's inception.

          IN WITNESS WHEREOF, T. Rowe Price Funds and T. Rowe Price
          Retirement Plan Services, Inc. have agreed upon this fee schedule
          to be executed in their names and on their behalf through their
          duly authorized officers:

          T. ROWE PRICE FUNDS                T. ROWE PRICE RETIREMENT PLAN
                                             SERVICES, INC.

          Name  /s/Carmen F. Deyesu          Name  /s/Charles E. Vieth 

          Title Treasurer                    Title  President

          Date  __________________________   Date   _______________________
































          PAGE 41
                                   AMENDMENT NO. 1
                                      AGREEMENT
                                       between
                     T. ROWE PRICE RETIREMENT PLAN SERVICES, INC.
                                         and
                     EACH OF THE PARTIES INDICATED ON APPENDIX A

               The Retirement Plan Services Contract of January 1, 1995,

          between T. Rowe Price Retirement Plan Services, Inc. and each of

          the Parties listed on Appendix A thereto is hereby amended, as of

          January 25, 1995, by adding thereto the T. Rowe Price Emerging

          Markets Stock Fund, a separate series of the T. Rowe Price

          International Funds, Inc.

                             T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
                             FUND, INC. 

                             T. ROWE PRICE BALANCED FUND, INC.

                             T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.

                             T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
                             TRUST
                             California Tax-Free Bond Fund
                             California Tax-Free Money Fund

                             T. ROWE PRICE CAPITAL APPRECIATION FUND

                             T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.

                             T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

                             T. ROWE PRICE EQUITY INCOME FUND

                             T. ROWE PRICE GNMA FUND

                             T. ROWE PRICE GROWTH & INCOME FUND, INC.

                             T. ROWE PRICE GROWTH STOCK FUND, INC.

                             T. ROWE PRICE HIGH YIELD FUND, INC.



















          PAGE 42
                             T. ROWE PRICE INDEX TRUST, INC.
                             T. Rowe Price Equity Index Fund

                             INSTITUTIONAL INTERNATIONAL FUNDS, INC.
                             Foreign Equity Fund

                             T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.

                             T. ROWE PRICE INTERNATIONAL FUNDS, INC.
                             T. Rowe Price International Bond Fund
                             T. Rowe Price International Discovery Fund
                             T. Rowe Price International Stock Fund
                             T. Rowe Price European Stock Fund
                             T. Rowe Price New Asia Fund
                             T. Rowe Price Global Government Bond Fund
                             T. Rowe Price Japan Fund
                             T. Rowe Price Short-Term Global Fund
                             T. Rowe Price Latin America Fund
                             T. Rowe Price Emerging Markets Bond Fund
                             T. Rowe Price Emerging Markets Stock Fund

                             T. ROWE PRICE MID-CAP GROWTH FUND

                             T. ROWE PRICE NEW AMERICA GROWTH FUND

                             T. ROWE PRICE NEW ERA FUND, INC.

                             T. ROWE PRICE NEW HORIZONS FUNDS, INC.

                             T. ROWE PRICE NEW INCOME FUND, INC.

                             T. ROWE PRICE OTC FUND, INC.
                             T. Rowe Price OTC Fund

                             T. ROWE PRICE PRIME RESERVE FUND, INC.

                             T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

                             T. ROWE PRICE SHORT-TERM BOND FUND, INC.

                             T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

                             T. ROWE PRICE SPECTRUM FUND, INC.
                             Spectrum Growth Fund
                             Spectrum Income Fund




















          PAGE 43
                             T. ROWE PRICE STATE TAX-FREE INCOME TRUST
                             Maryland Tax-Free Bond Fund
                             Maryland Short-Term Tax-Free Bond Fund
                             New York Tax-Free Bond Fund
                             New York Tax-Free Money Fund
                             New Jersey Tax-Free Bond Fund
                             Virginia Tax-Free Bond Fund
                             Florida Insured Intermediate Tax-Free Fund
                             Georgia Tax-Free Bond Fund

                             T. ROWE PRICE SUMMIT FUNDS, INC.
                             T. Rowe Price Summit Cash Reserves Fund
                             T. Rowe Price Summit Limited-Term Bond Fund
                             T. Rowe Price Summit GNMA Fund

                             T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
                             FUND, INC.

                             T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

                             T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

                             T. ROWE PRICE TAX-FREE INCOME FUND, INC.

                             T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
                             FUND, INC.

                             T. ROWE PRICE U.S. TREASURY FUNDS, INC.
                             U.S. Treasury Intermediate Fund
                             U.S. Treasury Long-Term Fund
                             U.S. Treasury Money Fund

                             T. ROWE PRICE VALUE FUND, INC.
          Attest:

          /s/Patricia S. Butcher       /s/Carmen F. Deyesu
          _________________________    _________________________
          Patricia S. Butcher,         By: Carmen F. Deyesu
          Assistant Secretary

          Attest:                      T. ROWE PRICE RETIREMENT PLAN
                                       SERVICES, INC.

          /s/Barbara A. Van Horn       /s/Henry H. Hopkins
          _________________________    ____________________________
          Barbara A. Van Horn,         By: Henry H. Hopkins,
          Assistant Secretary          Vice President










































































          


          PAGE 1
                          CONSENT OF INDEPENDENT ACCOUNTANTS


          To the Board of Directors of
              T. Rowe Price International
              Funds, Inc. and the Shareholders
              of T. Rowe Price Short-Term
              Global Income Fund and T. Rowe
              Price Global Government Bond Fund


              We consent to the incorporation by reference in this Post-
          Effective Amendment No. 54 to the Registration Statement of the
          T. Rowe Price International Funds, Inc. on Form N-1A (File No. 2-
          65539) of our report dated January 23, 1995 on our audit of the
          financial statements and financial highlights of the T. Rowe
          Price Short-Term Global Income Fund and T. Rowe Price Global
          Government Bond Fund (two of the portfolios comprising the T.
          Rowe Price International Funds, Inc.), which report is included
          in the Annual Report to Shareholders for the year ended December
          31, 1994 which is incorporated by reference in the Registration
          Statement.  We also consent to the reference to our Firm under
          the caption "Financial Highlights" in the Prospectus and
          "Independent Accountants" in the Statement of Additional
          Information.

          /s/Coopers & Lybrand L.L.P.
          COOPERS & LYBRAND L.L.P.
          Baltimore, Maryland
          March 1, 1995































          PAGE 2
                          CONSENT OF INDEPENDENT ACCOUNTANTS


          We hereby consent to the incorporation by reference in the
          Prospectus and Statement of Additional Information constituting
          parts of this Post-Effective Amendment No. 54 to the Registration
          Statement on Form N-1A (the "Registration Statement") of our
          report dated January 19, 1995, relating to the financial
          statements and selected per share data and ratios appearing in
          the December 31, 1994 Annual Report to Shareholders of the
          International Bond Fund, (a portfolio constituting T. Rowe Price
          International Funds, Inc.), which is also incorporated by
          reference into the Registration Statement.  We also consent to
          the references to us under the heading "Financial Highlights" in
          the Prospectus and under the heading "Independent Accountants" in
          the Statement of Additional Information.

          /s/Price Waterhouse LLP
          PRICE WATERHOUSE LLP
          Baltimore, Maryland
          March 1, 1995












































          PAGE 3
                          CONSENT OF INDEPENDENT ACCOUNTANTS


          We hereby consent to the reference to us under the heading
          "Independent Accountants" in the Statement of Additional
          Information constituting part of this Post-Effective Amendment
          No. 54 to the Registration Statement on Form N-1A of the Emerging
          Markets Bond Fund (a portfolio constituting T. Rowe Price
          International Funds, Inc.).

          /s/PRICE WATERHOUSE LLP
          Price Waterhouse LLP
          Baltimore, Maryland
          March 1, 1995



















































          

<TABLE> <S> <C>


          <ARTICLE> 6
          <CIK> 0000313212
          <NAME> T. ROWE PRICE INTERNATIONAL FUNDS, INC.
          <SERIES>
             <NUMBER> 6
             <NAME> T. ROWE PRICE GLOBAL GOVERNMENT BOND FUND
                 
          <S>                             <C>
          <PERIOD-TYPE>                   YEAR
          <FISCAL-YEAR-END>                          DEC-31-1994
          <PERIOD-END>                               DEC-31-1994
          <INVESTMENTS-AT-COST>                       38,653,933
          <INVESTMENTS-AT-VALUE>                      37,608,081
          <RECEIVABLES>                                3,978,037
          <ASSETS-OTHER>                                 334,686
          <OTHER-ITEMS-ASSETS>                                 0
          <TOTAL-ASSETS>                              41,920,804
          <PAYABLE-FOR-SECURITIES>                     4,504,840
          <SENIOR-LONG-TERM-DEBT>                              0
          <OTHER-ITEMS-LIABILITIES>                      899,703
          <TOTAL-LIABILITIES>                          5,404,542
          <SENIOR-EQUITY>                                      0
          <PAID-IN-CAPITAL-COMMON>                    39,982,488
          <SHARES-COMMON-STOCK>                        3,960,804
          <SHARES-COMMON-PRIOR>                        4,831,595
          <ACCUMULATED-NII-CURRENT>                      663,837
          <OVERDISTRIBUTION-NII>                               0
          <ACCUMULATED-NET-GAINS>                              0
          <OVERDISTRIBUTION-GAINS>                   (2,400,172)
          <ACCUM-APPREC-OR-DEPREC>                   (1,072,693)
          <NET-ASSETS>                                36,516,262
          <DIVIDEND-INCOME>                                    0
          <INTEREST-INCOME>                            2,964,164
          <OTHER-INCOME>                                       0
          <EXPENSES-NET>                                 524,488
          <NET-INVESTMENT-INCOME>                      2,439,666
          <REALIZED-GAINS-CURRENT>                   (2,352,634)
          <APPREC-INCREASE-CURRENT>                  (1,468,358)
          <NET-CHANGE-FROM-OPS>                      (1,381,325)
          <EQUALIZATION>                                       0
          <DISTRIBUTIONS-OF-INCOME>                  (2,439,629)
          <DISTRIBUTIONS-OF-GAINS>                      (85,595)


















          <DISTRIBUTIONS-OTHER>                                0
          <NUMBER-OF-SHARES-SOLD>                      1,707,674
          <NUMBER-OF-SHARES-REDEEMED>                  2,772,957
          <SHARES-REINVESTED>                            188,493
          <NET-CHANGE-IN-ASSETS>                    (12,242,000)
          <ACCUMULATED-NII-PRIOR>                        169,000
          <ACCUMULATED-GAINS-PRIOR>                            0
          <OVERDISTRIB-NII-PRIOR>                              0
          <OVERDIST-NET-GAINS-PRIOR>                 (2,407,000)
          <GROSS-ADVISORY-FEES>                          159,000
          <INTEREST-EXPENSE>                                   0
          <GROSS-EXPENSE>                                524,000
          <AVERAGE-NET-ASSETS>                        43,808,155
          <PER-SHARE-NAV-BEGIN>                            10.08
          <PER-SHARE-NII>                                    .54
          <PER-SHARE-GAIN-APPREC>                          (.84)
          <PER-SHARE-DIVIDEND>                               .51
          <PER-SHARE-DISTRIBUTIONS>                          .02
          <RETURNS-OF-CAPITAL>                               .03
          <PER-SHARE-NAV-END>                               9.22
          <EXPENSE-RATIO>                                   1.20
          <AVG-DEBT-OUTSTANDING>                               0
          <AVG-DEBT-PER-SHARE>                                 0
                  










































          

<TABLE> <S> <C>


          <ARTICLE> 6
          <CIK> 0000313212
          <NAME> T. ROWE PRICE INTERNATIONAL FUNDS, INC.
          <SERIES>
             <NUMBER> 2
             <NAME> T. ROWE PRICE INTERNATIONAL BOND FUND
                 
          <S>                             <C>
          <PERIOD-TYPE>                   YEAR
          <FISCAL-YEAR-END>                          DEC-31-1994
          <PERIOD-END>                               DEC-31-1994
          <INVESTMENTS-AT-COST>                          786,909
          <INVESTMENTS-AT-VALUE>                         767,840
          <RECEIVABLES>                                   24,596
          <ASSETS-OTHER>                                  41,924
          <OTHER-ITEMS-ASSETS>                                 0
          <TOTAL-ASSETS>                                 834,360
          <PAYABLE-FOR-SECURITIES>                        85,779
          <SENIOR-LONG-TERM-DEBT>                              0
          <OTHER-ITEMS-LIABILITIES>                       10,478
          <TOTAL-LIABILITIES>                             96,257
          <SENIOR-EQUITY>                                      0
          <PAID-IN-CAPITAL-COMMON>                       800,700
          <SHARES-COMMON-STOCK>                       79,017,288
          <SHARES-COMMON-PRIOR>                       72,108,501
          <ACCUMULATED-NII-CURRENT>                        5,062
          <OVERDISTRIBUTION-NII>                               0
          <ACCUMULATED-NET-GAINS>                              0
          <OVERDISTRIBUTION-GAINS>                      (49,697)
          <ACCUM-APPREC-OR-DEPREC>                      (17,962)
          <NET-ASSETS>                                   738,103
          <DIVIDEND-INCOME>                                    0
          <INTEREST-INCOME>                               52,876
          <OTHER-INCOME>                                       0
          <EXPENSES-NET>                                   7,324
          <NET-INVESTMENT-INCOME>                         45,552
          <REALIZED-GAINS-CURRENT>                      (35,246)
          <APPREC-INCREASE-CURRENT>                     (24,542)
          <NET-CHANGE-FROM-OPS>                         (14,236)
          <EQUALIZATION>                                       0
          <DISTRIBUTIONS-OF-INCOME>                     (45,550)
          <DISTRIBUTIONS-OF-GAINS>                      (16,210)


















          <DISTRIBUTIONS-OTHER>                                0
          <NUMBER-OF-SHARES-SOLD>                        376,286
          <NUMBER-OF-SHARES-REDEEMED>                  (360,173)
          <SHARES-REINVESTED>                             52,742
          <NET-CHANGE-IN-ASSETS>                         (7,141)
          <ACCUMULATED-NII-PRIOR>                            179
          <ACCUMULATED-GAINS-PRIOR>                          324
          <OVERDISTRIB-NII-PRIOR>                              0
          <OVERDIST-NET-GAINS-PRIOR>                           0
          <GROSS-ADVISORY-FEES>                            5,206
          <INTEREST-EXPENSE>                                   0
          <GROSS-EXPENSE>                                  7,324
          <AVERAGE-NET-ASSETS>                           750,554
          <PER-SHARE-NAV-BEGIN>                            10.34
          <PER-SHARE-NII>                                    .60
          <PER-SHARE-GAIN-APPREC>                          (.79)
          <PER-SHARE-DIVIDEND>                                 0
          <PER-SHARE-DISTRIBUTIONS>                        (.81)
          <RETURNS-OF-CAPITAL>                                 0
          <PER-SHARE-NAV-END>                               9.34
          <EXPENSE-RATIO>                                    .98
          <AVG-DEBT-OUTSTANDING>                               0
          <AVG-DEBT-PER-SHARE>                                 0
                  










































          

<TABLE> <S> <C>


          <ARTICLE> 6
          <CIK> 0000313212
          <NAME> T. ROWE PRICE INTERNATIONAL FUNDS, INC.
          <SERIES>
             <NUMBER> 8
             <NAME> T. ROWE PRICE SHORT-TERM GLOBAL INCOME FUND
                 
          <S>                             <C>
          <PERIOD-TYPE>                   YEAR
          <FISCAL-YEAR-END>                          DEC-31-1994
          <PERIOD-END>                               DEC-31-1994
          <INVESTMENTS-AT-COST>                           52,641
          <INVESTMENTS-AT-VALUE>                          50,749
          <RECEIVABLES>                                    6,577
          <ASSETS-OTHER>                                   1,541
          <OTHER-ITEMS-ASSETS>                                 0
          <TOTAL-ASSETS>                                  62,542
          <PAYABLE-FOR-SECURITIES>                         4,829
          <SENIOR-LONG-TERM-DEBT>                              0
          <OTHER-ITEMS-LIABILITIES>                        1,339
          <TOTAL-LIABILITIES>                              6,168
          <SENIOR-EQUITY>                                      0
          <PAID-IN-CAPITAL-COMMON>                        59,517
          <SHARES-COMMON-STOCK>                       12,863,431
          <SHARES-COMMON-PRIOR>                       20,154,762
          <ACCUMULATED-NII-CURRENT>                            0
          <OVERDISTRIBUTION-NII>                           (269)
          <ACCUMULATED-NET-GAINS>                              0
          <OVERDISTRIBUTION-GAINS>                         (912)
          <ACCUM-APPREC-OR-DEPREC>                       (1,962)
          <NET-ASSETS>                                    56,374
          <DIVIDEND-INCOME>                                    0
          <INTEREST-INCOME>                                6,179
          <OTHER-INCOME>                                       0
          <EXPENSES-NET>                                     814
          <NET-INVESTMENT-INCOME>                          5,365
          <REALIZED-GAINS-CURRENT>                       (8,334)
          <APPREC-INCREASE-CURRENT>                          164
          <NET-CHANGE-FROM-OPS>                          (2,805)
          <EQUALIZATION>                                       0
          <DISTRIBUTIONS-OF-INCOME>                      (1,030)
          <DISTRIBUTIONS-OF-GAINS>                             0


















          <DISTRIBUTIONS-OTHER>                          (4,335)
          <NUMBER-OF-SHARES-SOLD>                     12,426,772
          <NUMBER-OF-SHARES-REDEEMED>                 20,673,985
          <SHARES-REINVESTED>                            955,882
          <NET-CHANGE-IN-ASSETS>                        (40,744)
          <ACCUMULATED-NII-PRIOR>                            179
          <ACCUMULATED-GAINS-PRIOR>                          324
          <OVERDISTRIB-NII-PRIOR>                              0
          <OVERDIST-NET-GAINS-PRIOR>                           0
          <GROSS-ADVISORY-FEES>                              359
          <INTEREST-EXPENSE>                                   0
          <GROSS-EXPENSE>                                    814
          <AVERAGE-NET-ASSETS>                            81,417
          <PER-SHARE-NAV-BEGIN>                             4.82
          <PER-SHARE-NII>                                    .30
          <PER-SHARE-GAIN-APPREC>                          (.44)
          <PER-SHARE-DIVIDEND>                             (.06)
          <PER-SHARE-DISTRIBUTIONS>                            0
          <RETURNS-OF-CAPITAL>                             (.24)
          <PER-SHARE-NAV-END>                               4.38
          <EXPENSE-RATIO>                                   1.00
          <AVG-DEBT-OUTSTANDING>                               0
          <AVG-DEBT-PER-SHARE>                                 0
                  










































          

<TABLE> <S> <C>


          <ARTICLE> 6
          <CIK> 0000313212
          <NAME> T. ROWE PRICE INTERNATIONAL FUNDS, INC.
          <SERIES>
             <NUMBER> 10
             <NAME> T. ROWE PRICE EMERGING MARKETS BOND FUND
                 
          <S>                             <C>
          <PERIOD-TYPE>                   OTHER
          <FISCAL-YEAR-END>                          DEC-31-1994
          <PERIOD-END>                               DEC-31-1994
          <INVESTMENTS-AT-COST>                                0
          <INVESTMENTS-AT-VALUE>                               0
          <RECEIVABLES>                                        0
          <ASSETS-OTHER>                                       0
          <OTHER-ITEMS-ASSETS>                                 0
          <TOTAL-ASSETS>                                       0
          <PAYABLE-FOR-SECURITIES>                             0
          <SENIOR-LONG-TERM-DEBT>                              0
          <OTHER-ITEMS-LIABILITIES>                            0
          <TOTAL-LIABILITIES>                                  0
          <SENIOR-EQUITY>                                      0
          <PAID-IN-CAPITAL-COMMON>                             0
          <SHARES-COMMON-STOCK>                                0
          <SHARES-COMMON-PRIOR>                                0
          <ACCUMULATED-NII-CURRENT>                            0
          <OVERDISTRIBUTION-NII>                               0
          <ACCUMULATED-NET-GAINS>                              0
          <OVERDISTRIBUTION-GAINS>                             0
          <ACCUM-APPREC-OR-DEPREC>                             0
          <NET-ASSETS>                                         0
          <DIVIDEND-INCOME>                                    0
          <INTEREST-INCOME>                                    0
          <OTHER-INCOME>                                       0
          <EXPENSES-NET>                                       0
          <NET-INVESTMENT-INCOME>                              0
          <REALIZED-GAINS-CURRENT>                             0
          <APPREC-INCREASE-CURRENT>                            0
          <NET-CHANGE-FROM-OPS>                                0
          <EQUALIZATION>                                       0
          <DISTRIBUTIONS-OF-INCOME>                            0
          <DISTRIBUTIONS-OF-GAINS>                             0
          <DISTRIBUTIONS-OTHER>                                0


















          <NUMBER-OF-SHARES-SOLD>                              0
          <NUMBER-OF-SHARES-REDEEMED>                          0
          <SHARES-REINVESTED>                                  0
          <NET-CHANGE-IN-ASSETS>                               0
          <ACCUMULATED-NII-PRIOR>                              0
          <ACCUMULATED-GAINS-PRIOR>                            0
          <OVERDISTRIB-NII-PRIOR>                              0
          <OVERDIST-NET-GAINS-PRIOR>                           0
          <GROSS-ADVISORY-FEES>                                0
          <INTEREST-EXPENSE>                                   0
          <GROSS-EXPENSE>                                      0
          <AVERAGE-NET-ASSETS>                                 0
          <PER-SHARE-NAV-BEGIN>                                0
          <PER-SHARE-NII>                                      0
          <PER-SHARE-GAIN-APPREC>                              0
          <PER-SHARE-DIVIDEND>                                 0
          <PER-SHARE-DISTRIBUTIONS>                            0
          <RETURNS-OF-CAPITAL>                                 0
          <PER-SHARE-NAV-END>                                  0
          <EXPENSE-RATIO>                                      0
          <AVG-DEBT-OUTSTANDING>                               0
          <AVG-DEBT-PER-SHARE>                                 0
                  











































          


© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission