MASTER INVESTMENT PORTFOLIO, POS AMI, 1999-02-22

MASTER INVESTMENT PORTFOLIO
POS AMI, 1999-02-22

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<PAGE>

As filed with the Securities and Exchange Commission
on February 22, 1999

Registration No. 811-8162

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

_______________

FORM N-1A

AMENDMENT NO. 9 TO THE
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940

MASTER INVESTMENT PORTFOLIO
(Exact Name of Registrant as Specified in Charter)

111 Center Street, Little Rock, Arkansas 72201
(Address of Principal Executive Offices, including Zip Code)

_______________________________________

Registrant's Telephone Number, including Area Code:
(800) 643-9691

Richard H. Blank, Jr.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
(Name and Address of Agent for Service)

With a copy to:
Robert M. Kurucza, Esq.
Marco E. Adelfio, Esq.
Morrison & Foerster LLP
2000 Pennsylvania Avenue, N.W., Suite 5500
Washington, D.C. 20006-1812
<PAGE>

EXPLANATORY NOTE
----------------

This Amendment No. 9 to the Registration Statement of Master Investment
Portforlio (the "Trust") is being filed to add two new Master Portfolios to the
Trust- the Extended Index Master Portfolio and the U.S. Equity Index Portfolio.

This Amendment has been filed by the Registrant pursuant to Section 8(b)
of the Investment Company Act of 1940. However, beneficial interests in the
Registrant are not being registered under the Securities Act of 1933 (the "1933
Act") because such interests will be issued solely in private placement
transactions that do not involve any "public offering" within the meaning of
Section 4(2) of the 1933 Act. Investments in the Registrant may only be made by
registered broker/dealers or by investment companies, insurance company separate
accounts, common commingled trust funds, group trusts or similar organizations
or entities that are "accredited investors" within the meaning of Regulation D
under the 1933 Act. This Registration Statement does not constitute an offer to
sell, or the solicitation of an offer to buy, any beneficial interest in the
Registrant.
<PAGE>

Master Investment Portfolio
Cross Reference Sheet
---------------------

Form N-1A Item Number
- ---------------------

Part A Prospectus Caption
- ------ ------------------

4 General Description of Registrant
Investment Objectives
Investment Policies
Risk Considerations
5 Management of the Master Portfolios
Investment Adviser
Co-Administrators
Placement Agent
Custodian
Transfer Agent
Expenses
6 Capital Stock and Other Securities
Organization and Interests
Dividends and Distributions
Taxes
7 Purchase of Interests
8 Redemption or Repurchase
9 Not Applicable

Part B Statement of Additional Information
- ------ -----------------------------------

10 Cover Page
11 Table of Contents
12 General Information and History
13 Investment Objectives and Policies
Portfolio Securities
Management Policies
Investment Restrictions
14 Management of MIP
15 Control Persons and Principal Holders of Securities
16 Investment Advisory and Other Services
17 Brokerage Allocation and Other Practices
18 Capital Stock and Other Securities
19 Purchase, Redemption and Pricing of Securities
20 Tax Status
21 Underwriters
22 Calculation of Performance Data
23 Financial Information

Part C Other Information
- ------ -----------------

24-32 Information required to be included in Part C is set forth under
the appropriate Item, so numbered, in Part C of this Document.
<PAGE>

MASTER INVESTMENT PORTFOLIO

EXTENDED INDEX MASTER PORTFOLIO

PART A

FEBRUARY 22, 1999

Responses to Items 1 through 3 have been omitted pursuant to paragraph 4 of
Instruction F of the General Instructions to Form N-1A.

ITEM 4. GENERAL DESCRIPTION OF REGISTRANT.

General. Master Investment Portfolio ("MIP") is an open-end, management
investment company, organized on October 21, 1993 as a business trust under the
laws of the State of Delaware. MIP is a "series fund," which is a mutual fund
divided into separate portfolios. By this offering document, MIP is offering
one of its diversified portfolios - the Extended Index Master Portfolio (the
"Master Portfolio"). The Master Portfolio is treated as a separate entity for
certain matters under the Investment Company Act of 1940, as amended (the "1940
Act"), and for other purposes and an interestholder of the Master Portfolio is
not deemed to be an interestholder of any other portfolio of MIP. As described
below, for certain matters MIP interestholders vote together as a group; as to
others they vote separately by portfolio. MIP currently offers eleven other
portfolios pursuant to other offering documents. From time to time, other
portfolios may be established and sold pursuant to other offering documents.

Beneficial interests in the Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering" within
the meaning of Regulation D under the Securities Act of 1933, as amended (the
"1933 Act"). Investments in the Master Portfolio may be made only by investment
companies or certain other entities which are "accredited investors" within the
meaning of Regulation D under the 1933 Act. Investment companies that hold
shares of beneficial interest ("interests") in the Master Portfolio are
sometimes referred to herein as "feeder funds."

INVESTMENT OBJECTIVE.

. The Extended Index Master Portfolio seeks to match as closely as
practicable, before fees and expenses, the performance of the Wilshire
4500 Equity Index (the "Wilshire 4500 Index" or the "Index")./1/

The Master Portfolio's investment objective can be changed by MIP's
Board of Trustees without interestholder approval. The objective and policies
of the Master Portfolio determines the types of portfolio securities in which it
invests, the degree of risk to which it is subject and, ultimately, its
performance. There can be no assurance that the Master Portfolio's investment
objective will be achieved.
___________________

/1/ Wilshire Associates, Inc. ("Wilshire Associates") does not sponsor the
Master Portfolio, nor is it affiliated in any way with BGFA or the Master
Portfolio. "Wilshire 4500 Equity Index(R)," "Wilshire 4500 Index(R)," and
"Wilshire 4500(R)," are trademarks of Wilshire Associates of Santa Monica,
California. The Master Portfolio is not sponsored, endorsed, sold, or promoted
by the Wilshire 4500 Index, and neither Wilshire Associates nor the Wilshire
4500 Index makes any representation or warranty, express or implied, regarding
the advisability of investing in the Master Portfolio.

<PAGE>

INVESTMENT POLICIES.

. The Extended Index Master Portfolio seeks to match the total return
performance of U.S. stocks. The Fund defines these stocks as those
comprising the Wilshire 4500 Index, which is composed of over 6,500 equity
stocks of issuers headquartered in the United States. The Index is almost
entirely comprised of common stocks listed on the New York Stock Exchange,
American Stock Exchange or Nasdaq Stock Market. The weightings of stocks
in the Wilshire 4500 Index are based on each stock's relative total market
capitalization; that is, its market price per share times the number of
shares outstanding. The Master Portfolio invests in a representative
sample of these securities. Securities are selected for investment by the
Master Portfolio in accordance with their capitalization, industry sector
and valuation, among other factors.

No attempt is made to manage the portfolio of the Master Portfolio
using economic, financial and market analysis. The Master Portfolio is managed
by determining which securities are to be purchased or sold to match, to the
extent feasible, the capitalization range and returns of the Wilshire 4500
Index. Under normal market conditions, at least 90% of the value of the Master
Portfolio's total assets is invested in securities comprising the Wilshire 4500
Index. The Master Portfolio's ability to match its investment performance to
the investment performance of the Wilshire 4500 Index may be affected by, among
other things: the Master Portfolio's expenses; the amount of cash and cash
equivalents held by the Master Portfolio; the manner in which the total return
of the Wilshire 4500 Index is calculated; the size of the Master Portfolio's
investment portfolio; and the timing, frequency and size of interestholder
purchases and redemptions. The Master Portfolio uses cash flows from
interestholder purchase and redemption activity to maintain, to the extent
feasible, the similarity of its capitalization range and returns to those of the
securities comprising the Wilshire 4500 Index. Barclays Global Fund Advisors
("BGFA") regularly monitors the Master Portfolio's correlation to the Wilshire
4500 Index and adjusts the Master Portfolio's portfolio to the extent necessary.
Inclusion of a security in the Wilshire 4500 Index in no way implies an opinion
by Wilshire Associates as to its attractiveness as an investment.

The sampling techniques utilized by the Master Portfolio are designed
to allow the Master Portfolio to substantially duplicate the investment
performance of the Wilshire 4500 Index. However, the Master Portfolio is not
expected to track the Wilshire 4500 Index with the same degree of accuracy that
complete replication of such Index would provide. In addition , at times, the
portfolio composition of the Master Portfolio may be altered (or "rebalanced")
to reflect changes in the characteristics of the Wilshire 4500 Index.

In seeking to match the performance of the Wilshire 4500 Index, the
Master Portfolio also may engage in futures and options transactions and other
derivative securities transactions and lend its portfolio securities, each of
which involves risk. The Master Portfolio attempts to be fully invested at all
times in securities comprising the Wilshire 4500 Index and in futures contracts
and options on futures contracts, although the Master Portfolio may invest up to
10% of its assets in high-quality money market instruments to provide liquidity.
The Master Portfolio may invest up to 15% of the value of its net assets in
illiquid securities, including repurchase agreements providing for settlement in
more than seven days. See Item 13, "Investment Objective and Policies --
Investment Restrictions," in Part B.

industry or group of closely related industries, subject to certain exceptions
specified in Part B, including that there is no limitation on the purchase of
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. This paragraph describes fundamental policies that cannot be
changed without approval by the holders of a majority (as defined in the 1940
Act) of the Master Portfolio's outstanding voting securities. See Item 13,
"Investment Objective and Policies -- Investment Restrictions," in Part B.

RISK CONSIDERATIONS.

General -- The value of the Master Portfolio's interests is neither
insured nor guaranteed, is not fixed and should be expected to fluctuate.

Equity Securities -- The stock investments of the Master Portfolio are subject
to equity market risk. Equity market risk is the possibility that common stock
prices will fluctuate or decline over short or even extended periods. The U.S.
stock market tends to be cyclical, with periods when stock prices generally rise
and periods when prices generally decline. In addition, many of the companies
whose securities comprise the Wilshire 4500 Index are small to medium size
companies which, historically, have been more susceptible to market fluctuations
than securities of larger capitalization companies. As of the date of this
registration statement, the U.S. stock market, as measured by the Wilshire 4500
Index and other commonly used indices, was trading at or close to record levels.
There can be no assurance that these record levels will continue.

Debt Securities -- The debt instruments in which the Master Portfolio may invest
are subject to credit and interest rate risk. Credit risk is the risk that
issuers of debt instruments may default on the payment of principal and/or
interest. Interest-rate risk is the risk that increases in market interest
rates may adversely affect the value of debt instruments. The value of debt
instruments generally changes inversely to market interest rates. Debt
securities with longer maturities, which tend to produce higher yields, are
subject to potentially greater capital appreciation and depreciation than
obligations with shorter maturities. Changes in the financial strength of an
issuer or changes in the ratings of any particular security may also affect the
value of debt instruments. Although some debt instruments are guaranteed by the
U.S. Government, its agencies or instrumentalities, such instruments are subject
to interest rate risk and the market value of these instruments will fluctuate.
No assurance can be given that the U.S. Government would provide financial
support to the agencies or instrumentalities that issue or guarantee these
instruments where it is not obligated to do so.

Other Investment Considerations -- The Master Portfolio may enter into
transactions in futures contracts and options on futures contracts, each of
which involves risk. The futures contracts and options on futures contracts
that the Master Portfolio may purchase may be considered derivatives.
Derivatives are financial instruments whose values are derived, at least in
part, from the prices of other securities or specified assets, indices or rates.
The Master Portfolio intends to use futures contracts and options as part of its
short-term liquidity holdings and/or substitutes for comparable market positions
in the underlying securities. Some derivatives may be more sensitive than
direct securities to changes in interest rates or sudden market moves. Some
derivatives also may be susceptible to fluctuations in yield or value due to
their structure or contract terms.

Year 2000 -- Many computer software systems in use today cannot distinguish the
Year 2000 from the Year 1900. Most of the services provided to the Master
Portfolio depend on the smooth functioning of computer systems. Any failure to
adapt these systems in time could hamper the Master Portfolio's operations and
services. The Master Portfolio's principal service providers have advised the
Master Portfolio that they are working on necessary changes to their systems and
that they expect their systems to be adapted in time. There can, of course, be
no assurance of success. In addition, because the Year 2000 issue affects
virtually all organizations, the companies or entities in which the Master
Portfolio invests also could be adversely impacted by the Year 2000 issue. The
extent of such impact cannot be predicted.
<PAGE>

Item 5. Management of the Master Portfolio.

INVESTMENT ADVISER -- BGFA serves as investment adviser to the Master Portfolio.
BGFA is a direct subsidiary of Barclays Global Investors, N.A. (which, in turn,
is an indirect subsidiary of Barclays Bank PLC ("Barclays")) and is located at
45 Fremont Street, San Francisco, CA 94105. As of November 30, 1998, BGFA and
its affiliates provided investment advisory services for approximately $569
billion of assets under management.

BGFA provides the Master Portfolio with investment guidance and policy
direction in connection with the daily portfolio management of the Master
Portfolio, subject to the supervision of MIP's Board of Trustees and in
conformity with Delaware law and the stated policies of the Master Portfolio.
BGFA furnishes to MIP's Board of Trustees periodic reports on the investment
strategy and performance of the Master Portfolio.

BGFA is entitled to receive monthly fees at the annual rate of 0.08%
of the average daily net assets of the Master Portfolio as compensation for its
advisory services. From time to time, BGFA may waive such fees in whole or in
part. Any such waiver will reduce the expenses of the Master Portfolio and,
accordingly, have a favorable impact on its performance.

Purchase and sale orders for portfolio securities of the Master
Portfolio may be combined with those of other accounts that BGFA manages or
advises, and for which it has brokerage placement authority, in the interest of
seeking the most favorable overall net results. When BGFA, subject to the
supervision of, and the overall authority of MIP's Board of Trustees, determines
that a particular security should be bought or sold for the Master Portfolio and
other accounts managed by BGFA, it undertakes to allocate those transactions
among the participants equitably.

BGFA may deal, trade and invest for its own account in the types of
securities in which the Master Portfolio may invest. BGFA has informed MIP that
in making its investment decisions it does not obtain or use material inside
information in its possession.

Morrison & Foerster LLP, counsel to MIP and special counsel to BGFA,
has advised MIP and BGFA that BGFA and its affiliates may perform the services
contemplated by the BGFA Advisory Contracts and this Part A without violation of
the Glass-Steagall Act. Such counsel has pointed out, however, that there are
no controlling judicial or administrative interpretations or decisions and that
future judicial or administrative interpretations of, or decisions relating to,
present federal or state statutes, including the Glass-Steagall Act, and
regulations relating to the permissible activities of banks and their
subsidiaries or affiliates, as well as future changes in such statutes,
regulations and judicial or administrative decisions or interpretations, could
prevent such entities from continuing to perform, in whole or in part, such
services. If any such entity were prohibited from performing any such services,
it is expected that new agreements would be proposed or entered into with
another entity or entities qualified to perform such services.

CO-ADMINISTRATORS -- Stephens Inc. ("Stephens") and Barclays Global Investors,
N.A. ("BGI") are the Master Portfolio's co-administrators. Stephens and BGI
provide the Master Portfolio with administrative services, including general
supervision of the Master Portfolio's non-investment operations, coordination of
the other services provided to the Master Portfolio, compilation of information
for reports to the SEC and the state securities commissions, preparation of
proxy statements and interestholder reports, and general supervision of data
compilation in connection with preparing periodic reports to the MIP's trustees
and officers. Stephens also furnishes office space and certain facilities to
conduct the Master Portfolio's business, and compensates the MIP's trustees,
officers, and employees who are affiliated with Stephens. In addition, except as
outlined below under "Expenses," Stephens and BGI will be responsible for paying
all expenses incurred by the Master Portfolio other than the fees payable to
BGFA and other than custodial fees of up to 0.01% payable after the first two
years or the Master Portfolio's operations. Stephens and BGI are entitled to
receive a monthly fee, in the aggregate, at an annual rate of 0.02% of the
average daily net assets of the Master Portfolio for providing administrative
services and assuming expenses.
<PAGE>

PLACEMENT AGENT -- Stephens is the placement agent for the Master Portfolio.
Stephens is a full service broker/dealer and investment advisory firm located at
111 Center Street, Little Rock, Arkansas 72201. Stephens and its predecessor
have been providing securities and investment services for more than 60 years,
including discretionary portfolio management services since 1983. Stephens
currently manages investment portfolios for pension and profit sharing plans,
individual investors, foundations, insurance companies and university
endowments. Stephens does not receive compensation for acting as placement agent
to the Master Portfolio.

CUSTODIAN -- IBT currently acts as the Master Portfolio's custodian. The
principal business address of IBT is 200 Clarendon Street, Boston, Massachusetts
02111. During the first two years of the Master Portfolio's operations, IBT
will be entitled to receive compensation for its custodial services from
Stephens and BGI. Thereafter, IBT will be entitled to receive custodial fees
of up to 0.01% from the Master Portfolio.

TRANSFER AGENT -- IBT also acts as the Master Portfolio's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). IBT does not receive compensation for
acting as Transfer Agent to the Master Portfolio.

EXPENSES -- Except for brokerage and other expenses connected to the execution
of portfolio securities transactions, litigation expenses, taxes (including
income, excise, transfer and withholding taxes) or any cost or expense that a
majority of the disinterested trustees of MIP deems to be an extraordinary
expense, Stephens and BGI have agreed to bear all costs of the Master
Portfolio's and MIP's operations. Expenses attributable only to the Master
Portfolio shall be charged only against the assets of the Master Portfolio.
General expenses of MIP shall be allocated among its portfolios in a manner
proportionate to the net assets of each, on a transactional basis or on such
other basis as the Board of Trustees deems equitable.

Item 6. Capital Stock and Other Securities.

ORGANIZATION AND INTERESTS

MIP is organized as a business trust under the laws of the State of
Delaware. Investors in MIP are each liable for all obligations of MIP.
However, the risk of an investor incurring financial loss on account of such
liability is limited to circumstances in which both inadequate insurance existed
and itself was unable to meet its obligations.

The Board of Trustees has authorized several series of which twelve
are active. All consideration received by MIP for interests in one of the
series and all assets in which such consideration is invested will belong to
that series (subject only to the rights of creditors of MIP) and will be subject
to the liabilities related thereto. The income attributable to, and the
expenses of, one series are treated separately from those of the other series.
From time to time, MIP may create new series without shareholder approval.

As of February 22, 1999, Stephens owned approximately 99.99% of the
outstanding voting securities of the Master Portfolio. As such, Stephens could
each be considered a "controlling person" of the Master Portfolio for purposes
of the 1940 Act.

INTERESTS IN THE MASTER PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS OF,
OR GUARANTEED OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY. AN INVESTMENT IN THE MASTER PORTFOLIO INVOLVES CERTAIN INVESTMENT
RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. THE SHARE PRICE AND INVESTMENT
RETURN OF THE MASTER PORTFOLIO ARE EXPECTED TO FLUCTUATE AND INVESTMENTS IN THE
MASTER PORTFOLIO ARE NOT GUARANTEED.

However, the holders of at least 10% of the securities outstanding and entitled
to vote may require MIP to hold a special meeting of interestholders for
purposes of removing a Trustee from office. MIP interestholders may remove a
Trustee by the affirmative vote of sixty-six and two thirds percent of MIP's
outstanding interests entitled to vote thereon. In addition, the Board of
Trustees will call a meeting of interestholders for the purpose of electing
Trustees if, at any time, less than a majority of the Trustees then holding
office have been elected by interestholders. Investments in the Master
Portfolio may not be transferred, but an investor may redeem all or any portion
of its investment at any time at net asset value.

TAXES

MIP believes that the Master Portfolio will qualify as a non-publicly traded
partnership for federal income tax purposes. MIP therefore believes that the
Master Portfolio will not be subject to any federal income tax on its income and
net capital gains (if any). However, each investor in the Master Portfolio will
be taxable on its distributive share of the Master Portfolio's taxable income in
determining its federal income tax liability. As a non-publicly traded
partnership, the Master Portfolio will be deemed to have "passed through" to
interestholders any interests, dividends, gains or losses. The determination of
such share will be made in accordance with the Internal Revenue Code of 1986, as
amended (the "Code"), and regulations promulgated thereunder.

It is intended that the Master Portfolio's assets, income and distributions
will be managed in such a way that a regulated investment company investing in
the Master Portfolio may satisfy the requirements of Subchapter M of the Code by
investing substantially all of its assets in the Master Portfolio.

Investor inquiries should be directed to Master Investment Portfolio, 111
Center Street, Little Rock, Arkansas 72201.

Item 7. Purchase of Interests.

Beneficial interests in the Master Portfolio are issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Master Portfolio may
be made only by investment companies or certain other entities which are
"accredited investors" within the meaning of Regulation D under the Securities
Act of 1933, as amended.

Interests in the Master Portfolio are sold at the net asset value per unit of
beneficial interest ("NAV") next determined after an order in proper form is
received by MIP. NAV for the Master Portfolio is determined as of the close of
trading of the New York Stock Exchange (currently 4:00 p.m., Eastern Standard
Time), on each day the New York Stock Exchange is open for business (a "Business
Day"). NAV is computed by dividing the value of the Master Portfolio's net
assets (i.e., the value of its assets less liabilities) by the total number of
interests in the Master Portfolio outstanding. The Master Portfolio's
investments are valued each Business Day generally by using available market
quotations or at fair value determined in good faith by MIP's Board of Trustees.
For further information regarding the methods employed in valuing the Master
Portfolio's investments, see Item 19, "Purchase, Redemption and Pricing of
Securities" in Part B.

Item 8. Redemption or Repurchase.
<PAGE>

An investor in MIP may redeem all or any portion of its investment on any
Business Day at the net asset value next determined after a redemption request
in proper form is furnished by the investor to MIP. When a request is received
in proper form, MIP will redeem the interests at the next determined net asset
value.

The Master Portfolio will make payment for all interests redeemed within
three days after receipt by MIP of a redemption request in proper form, except
as provided by the rules of the Securities and Exchange Commission. MIP reserves
the right to pay redemption proceeds, in whole or in part, by distributing
portfolio securities in lieu of cash if, in the opinion of management, it is
advisable to do so. Interests in the Master Portfolio may not be transferred.

The right of any investor to receive payment with respect to any redemption
may be suspended or the payment of the withdrawal proceeds postponed during any
period in which the New York Stock Exchange is closed (other than weekends or
holidays) or trading on such Exchange is restricted, or, to the extent otherwise
permitted by the 1940 Act, if an emergency exists.

Item 9. Pending Legal Proceedings.

Not applicable.
<PAGE>

APPENDIX

PORTFOLIO SECURITIES.

To the extent set forth in this offering document, the Master Portfolio may
invest in the securities described below.

Short-Term Instruments and Temporary Investments -- The Master Portfolio
may invest in high-quality money market instruments on an ongoing basis to
provide liquidity, for temporary purposes when there is an unexpected level of
interestholder purchases or redemptions or when "defensive" strategies are
appropriate. The instruments in which the Master Portfolio may invest include:
(i) short-term obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities (including government-sponsored enterprises); (ii)
negotiable certificates of deposit ("CDs"), bankers' acceptances, fixed time
deposits and other obligations of domestic banks (including foreign branches)
that have more than $1 billion in total assets at the time of investment and
that are members of the Federal Reserve System or are examined by the
Comptroller of the Currency or whose deposits are insured by the FDIC; (iii)
commercial paper rated at the date of purchase "Prime-1" by Moody's or "A-1+" or
"A-1" by S&P, or, if unrated, of comparable quality as determined by BGFA or
Wells Fargo Bank; (iv) non-convertible corporate debt securities (e.g., bonds
and debentures) with remaining maturities at the date of purchase of not more
than one year that are rated at least "Aa" by Moody's or "AA" by S&P; (v)
repurchase agreements; and (vi) short-term, U.S. dollar-denominated obligations
of foreign banks (including U.S. branches) that, at the time of investment have
more than $10 billion, or the equivalent in other currencies, in total assets
and in the opinion of BGFA or Wells Fargo Bank are of comparable quality to
obligations of U.S. banks which may be purchased by the Master Portfolio.

Bank Obligations -- The Master Portfolio may invest in bank obligations,
----------------
including certificates of deposit, time deposits, bankers' acceptances and other
short-term obligations of domestic banks, foreign subsidiaries of domestic
banks, foreign branches of domestic banks, and domestic and foreign branches of
foreign banks, domestic savings and loan associations and other banking
institutions.

Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period of
time.

Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate. Time
deposits which may be held by the Master Portfolio will not benefit from
insurance from the Bank Insurance Fund or the Savings Association Insurance Fund
administered by the Federal Deposit Insurance Corporation.

Bankers' acceptances are credit instruments evidencing the obligation of a
bank to pay a draft drawn on it by a customer. These instruments reflect the
obligation both of the bank and of the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may include
uninsured, direct obligations, bearing fixed, floating- or variable-interest
rates.

Commercial Paper and Short-Term Corporate Debt Instruments -- The Master
----------------------------------------------------------
Portfolio may invest in commercial paper (including variable amount master
demand notes), which consists of short-term, unsecured promissory notes issued
by corporations to finance short-term credit needs. Commercial paper is usually
sold on a discount basis and has a maturity at the time of issuance not
exceeding nine months. Variable amount master demand notes are demand
obligations that permit the investment of fluctuating amounts at varying market
rates of interest pursuant to arrangements between the issuer and a commercial
bank acting as agent for the payee of such notes whereby both parties have the
right to vary the amount of the outstanding indebtedness on the notes. The
investment adviser and/or sub-adviser to the Master Portfolio monitors on an
ongoing basis the ability of an issuer of a demand instrument to pay principal
and interest on demand.
<PAGE>

The Master Portfolio also may invest in non-convertible corporate debt
securities (e.g., bonds and debentures) with not more than one year remaining to
maturity at the date of settlement. The Master Portfolio will invest only in
such corporate bonds and debentures that are rated at the time of purchase at
least "Aa" by Moody's or "AA" by S&P. Subsequent to its purchase by the Master
Portfolio, an issue of securities may cease to be rated or its rating may be
reduced below the minimum rating required for purchase by the Master Portfolio.
The investment adviser and/or sub-adviser to the Master Portfolio will consider
such an event in determining whether the Master Portfolio should continue to
hold the obligation. To the extent the Master Portfolio continues to hold such
obligations, it may be subject to additional risk of default.

Repurchase Agreements -- The Master Portfolio may enter into repurchase
---------------------
agreements wherein the seller of a security to the Master Portfolio agrees to
repurchase that security from the Master Portfolio at a mutually-agreed upon
time and price. The period of maturity is usually quite short, often overnight
or a few days, although it may extend over a number of months. The Master
Portfolio may enter into repurchase agreements only with respect to securities
that could otherwise be purchased by the Master Portfolio, and all repurchase
transactions must be collateralized. The Master Portfolio may incur a loss on a
repurchase transaction if the seller defaults and the value of the underlying
collateral declines or is otherwise limited or if receipt of the security or
collateral is delayed. The Master Portfolio may participate in pooled repurchase
agreement transactions with other funds advised by BGFA. See "Additional
Permitted Investment Activities" in the Part B for additional information.

U.S. Government Obligations -- The Master Portfolio may invest in various
---------------------------
types of U.S. Government obligations. U.S. Government obligations include
securities issued or guaranteed as to principal and interest by the U.S.
Government, its agencies or instrumentalities. Payment of principal and interest
on U.S. Government obligations (i) may be backed by the full faith and credit of
the United States (as with U.S. Treasury obligations and GNMA certificates) or
(ii) may be backed solely by the issuing or guaranteeing agency or
instrumentality itself (as with FNMA notes). In the latter case, the investor
must look principally to the agency or instrumentality issuing or guaranteeing
the obligation for ultimate repayment, which agency or instrumentality may be
privately owned. There can be no assurance that the U.S. Government would
provide financial support to its agencies or instrumentalities where it is not
obligated to do so. As a general matter, the value of debt instruments,
including U.S. Government obligations, declines when market interest rates
increase and rises when market interest rates decrease. Certain types of U.S.
Government obligations are subject to fluctuations in yield or value due to
their structure or contract terms.

Floating- and Variable-Rate Obligations -- The Master Portfolio may
purchase debt instruments with interest rates that are periodically adjusted at
specified intervals or whenever a benchmark rate or index changes. These
adjustments generally limit the increase or decrease in the amount of interest
received on the debt instruments. Floating- and variable-rate instruments are
subject to interest-rate risk and credit risk.

Illiquid Securities -- The Master Portfolio may invest up to 15% of the
value of its net assets in securities as to which a liquid trading market does
not exist, provided such investments are consistent with its investment
objective. Such securities may include securities that are not readily
marketable, such as privately issued securities and other securities that are
subject to legal or contractual restrictions on resale, floating- and variable-
rate demand obligations as to which the Master Portfolio cannot exercise a
demand feature on not more than seven days' notice and as to which there is no
secondary market and repurchase agreements providing for settlement more than
seven days after notice.

Investment Company Securities -- The Master Portfolio may invest in
securities issued by other open-end, management investment companies to the
extent permitted under the 1940 Act. As a general matter, under the 1940 Act,
investment in such securities is limited to: (i) 3% of the total voting stock of
any one investment company, (ii) 5% of the Master Portfolio's net assets with
respect to any one investment company and (iii) 10% of the Master Portfolio's
net assets with respect to all such companies in the aggregate. Investments in
the securities of other investment companies generally will involve duplication
of advisory fees
<PAGE>

and certain other expenses. The Master Portfolio may also purchase interests of
exchange-listed closed-end funds to the extent permitted under the 1940 Act.

Futures Contracts and Options Transactions -- The Master Portfolio may use
futures as a substitute for a comparable market position in the underlying
securities.

A futures contract is an agreement between two parties, a buyer and a
seller, to exchange a particular commodity or financial statement at a specific
price on a specific date in the future. An option transaction generally involves
a right, which may or may not be exercised, to buy or sell a commodity or
financial instrument at a particular price on a specified future date. Futures
contracts and options are standardized and traded on exchanges, where the
exchange serves as the ultimate counterparty for all contracts. Consequently,
the primary credit risk on futures contracts is the creditworthiness of the
exchange. Futures contracts are subject to market risk (i.e., exposure to
adverse price changes).

Although the Master Portfolio intends to purchase or sell futures contracts
only if there is an active market for such contracts, no assurance can be given
that a liquid market will exist for any particular contract at any particular
time. Many futures exchanges and boards of trade limit the amount of fluctuation
permitted in futures contract prices during a single trading day. Once the daily
limit has been reached in a particular contract, no trades may be made that day
at a price beyond that limit or trading may be suspended for specified periods
during the trading day. Futures contract prices could move to the limit for
several consecutive trading days with little or no trading, thereby preventing
prompt liquidation of futures positions and potentially subjecting the Master
Portfolio to substantial losses. If it is not possible, or if the Master
Portfolio determines not to close a futures position in anticipation of adverse
price movements, the Master Portfolio will be required to make daily cash
payments on variation margin.

Stock Index Futures and Options on Stock Index Futures -- The Master
------------------------------------------------------
Portfolio may invest in stock index futures and options on stock index futures
as a substitute for a comparable market position in the underlying securities. A
stock index future obligates the seller to deliver (and the purchaser to take),
effectively, an amount of cash equal to a specific dollar amount times the
difference between the value of a specific stock index at the close of the last
trading day of the contract and the price at which the agreement is made. No
physical delivery of the underlying stocks in the index is made. With respect to
stock indices that are permitted investments, the Master Portfolio intends to
purchase and sell futures contracts on the stock index for which it can obtain
the best price with consideration also given to liquidity. There can be no
assurance that a liquid market will exist at the time when the Master Portfolio
seeks to close out a futures contract or a futures option position. Lack of a
liquid market may prevent liquidation of an unfavorable position.

Index Swaps -- The Master Portfolio may enter into index swaps in pursuit
-----------
of its investment objective. Index swaps involve the exchange by the Master
Portfolio with another party of cash flows based upon the performance of an
index of securities or a portion of an index of securities that usually include
dividends or income. In each case, the exchange commitments can involve payments
to be made in the same currency or in different currencies. The Master Portfolio
will usually enter into swaps on a net basis. In so doing, the two payment
streams are netted out, with the Master Portfolio receiving or paying, as the
case may be, only the net amount of the two payments. If the Master Portfolio
enters into a swap, it will maintain a segregated account on a gross basis,
unless the contract provides for a segregated account on a net basis. If there
is a default by the other party to such a transaction, the Master Portfolio will
have contractual remedies pursuant to the agreements related to the transaction.

Master Portfolio is contractually obligated to make. There is also a risk of a
default by the other party to a swap, in which case the Master Portfolio may not
receive net amount of payments that the Master Portfolio contractually is
entitled to receive.

Loans of Portfolio Securities -- The Master Portfolio may lend securities
from its portfolio to brokers, dealers and financial institutions (but not
individuals) in order to increase its portfolio's return. The value of the
loaned securities may not exceed one-third of the Master Portfolio's total
assets and loans of portfolio securities are fully collateralized based on
values that are market-to-market daily. The Master Portfolio will not enter into
any portfolio security lending arrangement having a duration of longer than one
year. The principal risk of portfolio lending is potential default or insolvency
of the borrower. In either of these cases, the Master Portfolio could experience
delays in recovering securities or collateral or could lose all or part of the
value of the loaned securities. The Master Portfolio may pay reasonable
administrative and custodial fees in connection with loans of portfolio
securities and may pay a portion of the interest or fee earned thereon to the
borrower or a placing broker. See "Additional Permitted Investment Activities"
in the Part B for additional information.

Forward Commitments, When-Issued Purchases and Delayed-Delivery
Transactions --The Master Portfolio may purchase or sell securities on a when-
issued or delayed-delivery basis and make contracts to purchase or sell
securities for a fixed price at a future date beyond customary settlement time.
Securities purchased or sold on a when-issued, delayed-delivery or forward
commitment basis involve a risk of loss if the value of the security to be
purchased declines, or the value of the security to be sold increases, before
the settlement date. Although the Master Portfolio will generally purchase
securities with the intention of acquiring them, the Master Portfolio may
dispose of securities purchased on a when-issued, delayed-delivery or a forward
commitment basis before settlement when deemed appropriate by the adviser.

Borrowing Money -- As a fundamental policy, the Master Portfolio is
permitted to borrow to the extent permitted under the 1940 Act. However, the
Master Portfolio currently intends to borrow money only for temporary or
emergency (not leveraging) purposes, and may borrow up to one-third of the value
of its total assets (including the amount borrowed) valued at the lesser of cost
or market, less liabilities (not including the amount borrowed) at the time the
borrowing is made.
<PAGE>

MASTER INVESTMENT PORTFOLIO

EXTENDED INDEX MASTER PORTFOLIO

PART B -- STATEMENT OF ADDITIONAL INFORMATION

FEBRUARY 22, 1999

Item 10. Cover Page.

Master Investment Portfolio ("MIP") is an open-end, management
investment company. MIP is a "series fund," which is a mutual fund divided into
separate portfolios. This Part B is not a prospectus and should be read in
conjunction with MIP's Part A, also dated February 22, 1999. All terms used in
this Part B that are defined in Part A have the meanings assigned in Part A. A
copy of Part A may be obtained without charge by writing Master Investment
Portfolio, c/o Investors Bank & Trust Co., -- Transfer Agent, P.O. Box 9130,
Mail Code MFD23, Boston, MA 02117-9130, or by calling 1-800-204-3956. MIP's
Registration Statement may be examined at the office of the Securities and
Exchange Commission ("SEC") in Washington, D.C.

Item 11. Table Of Contents

<TABLE>
Page
-------
<S> <C>
General Information and History....................................................... 1
Investment Objectives and Policies.................................................... 1
Management of MIP..................................................................... 6
Control Persons and Principal Holders of Securities................................... 7
Investment Advisory and Other Services................................................ 8
Brokerage Allocation and Other Practices.............................................. 9
Capital Stock and Other Securities.................................................... 9
Purchase, Redemption and Pricing of Securities........................................ 9
Tax Status............................................................................ 11
Underwriters.......................................................................... 11
Calculations of Performance Data...................................................... 11
Financial Information................................................................. 11
Appendix.............................................................................. A-1
Financial Statements.................................................................. F-1
</TABLE>

Item 12. General Information and History.

Not applicable.

Item 13. Investment Objectives and Policies.

The following information supplements and should be read in conjunction
with Item 4 in Part A.

Investment Objectives. By this offering document, MIP is offering a
diversified portfolio, Extended Index Master Portfolio ("Master Portfolio").
Organizations and other entities that hold shares of beneficial interest of the
Master Portfolio may be referred to herein as "feeder funds."

The Master Portfolio's investment objective is set forth in Item 4,
"General Description of Registrant -- Investment Objective," of Part A. The
Master Portfolio's investment objective can be changed by MIP's Board of
Trustees without interestholder approval. The objective and policies of the
Master Portfolio determines the types

1
<PAGE>

of portfolio securities in which it invests, the degree of risk to which it is
subject and, ultimately, its performance. There can be no assurance that the
investment objectives of the Master Portfolio will be achieved.

Portfolio Securities.

Bank Obligations. Domestic commercial banks organized under Federal law
are supervised and examined by the Comptroller of the Currency and are required
to be members of the Federal Reserve System and to have their deposits insured
by the Federal Deposit Insurance Corporation (the "FDIC"). Domestic banks
organized under state law are supervised and examined by state banking
authorities but are members of the Federal Reserve System only if they elect to
join. In addition, state banks whose certificates of deposit ("CDs") may be
purchased by the Master Portfolio are insured by the FDIC (although such
insurance may not be of material benefit to the Master Portfolio, depending on
the principal amount of the CDs of each bank held by the Master Portfolio) and
are subject to Federal examination and to a substantial body of Federal law and
regulation. As a result of Federal or state laws and regulations, domestic
branches of domestic banks whose CDs may be purchased by the Master Portfolio
generally are required, among other things, to maintain specified levels of
reserves, are limited in the amounts which they can loan to a single borrower
and are subject to other regulation designed to promote financial soundness.
However, not all of such laws and regulations apply to the foreign branches of
domestic banks.

Obligations of foreign branches of domestic banks, foreign subsidiaries of
domestic banks and domestic and foreign branches of foreign banks, such as CDs
and time deposits ("TDs"), may be general obligations of the parent banks in
addition to the issuing branch, or may be limited by the terms of a specific
obligation and governmental regulation. Such obligations are subject to
different risks than are those of domestic banks. These risks include foreign
economic and political developments, foreign governmental restrictions that may
adversely affect payment of principal and interest on the obligations, foreign
exchange controls and foreign withholding and other taxes on interest income.
These foreign branches and subsidiaries are not necessarily subject to the same
or similar regulatory requirements that apply to domestic banks, such as
mandatory reserve requirements, loan limitations, and accounting, auditing and
financial record keeping requirements. In addition, less information may be
publicly available about a foreign branch of a domestic bank or about a foreign
bank than about a domestic bank.

Obligations of United States branches of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation or by Federal or state regulation
as well as governmental action in the country in which the foreign bank has its
head office. A domestic branch of a foreign bank with assets in excess of $1
billion may be subject to reserve requirements imposed by the Federal Reserve
System or by the state in which the branch is located if the branch is licensed
in that state.

In addition, Federal branches licensed by the Comptroller of the Currency
and branches licensed by certain states ("State Branches") may be required to:
(1) pledge to the regulator, by depositing assets with a designated bank within
the state, a certain percentage of their assets as fixed from time to time by
the appropriate regulatory authority; and (2) maintain assets within the state
in an amount equal to a specified percentage of the aggregate amount of
liabilities of the foreign bank payable at or through all of its agencies or
branches within the state. The deposits of Federal and State Branches generally
must be insured by the FDIC if such branches take deposits of less than
$100,000.

In view of the foregoing factors associated with the purchase of CDs and
TDs issued by foreign branches of domestic banks, by foreign subsidiaries of
domestic banks, by foreign branches of foreign banks or by domestic branches of
foreign banks, BGFA carefully evaluates such investments on a case-by-case
basis.

The Master Portfolio may purchase CDs issued by banks, savings and loan
associations and similar thrift institutions with less than $1 billion in
assets, which are members of the FDIC, provided such Master Portfolio purchases
any such CD in a principal amount of not more than $100,000, which amount would
be fully insured by the Bank Insurance Fund or the Savings Association Insurance
Fund administered by the FDIC. Interest payments on such a CD are not insured
by the FDIC. No Master Portfolio will own more than one such CD per such
issuer.

2
<PAGE>

Management Policies.

Repurchase Agreements. The Master Portfolio may engage in a repurchase
agreement with respect to any security in which it is authorized to invest,
although the underlying security may mature in more than thirteen months. The
Master Portfolio may enter into repurchase agreements wherein the seller of a
security to the Master Portfolio agrees to repurchase that security from the
Master Portfolio at a mutually agreed-upon time and price that involves the
acquisition by the Master Portfolio of an underlying debt instrument, subject to
the seller's obligation to repurchase, and the Master Portfolio's obligation to
resell, the instrument at a fixed price usually not more than one week after its
purchase. The Master Portfolio's custodian has custody of, and holds in a
segregated account, securities acquired as collateral by the Master Portfolio
under a repurchase agreement. Repurchase agreements are considered by the staff
of the SEC to be loans by the Master Portfolio. The Master Portfolio may enter
into repurchase agreements only with respect to securities of the type in which
it may invest, including government securities and mortgage-related securities,
regardless of their remaining maturities, and requires that additional
securities be deposited with the custodian if the value of the securities
purchased should decrease below resale price. BGFA monitors on an ongoing basis
the value of the collateral to assure that it always equals or exceeds the
repurchase price. Certain costs may be incurred by the Master Portfolio in
connection with the sale of the underlying securities if the seller does not
repurchase them in accordance with the repurchase agreement. In addition, if
bankruptcy proceedings are commenced with respect to the seller of the
securities, disposition of the securities by the Master Portfolio may be delayed
or limited. While it does not presently appear possible to eliminate all risks
from these transactions (particularly the possibility of a decline in the market
value of the underlying securities, as well as delay and costs to the Master
Portfolio in connection with insolvency proceedings), it is the policy of the
Master Portfolio to limit repurchase agreements to selected creditworthy
securities dealers or domestic banks or other recognized financial institutions.
The Master Portfolio considers on an ongoing basis the creditworthiness of the
institutions with which it enters into repurchase agreements. Repurchase
agreements are considered to be loans by a Master Portfolio under the 1940 Act.

Floating- and Variable-Rate Obligations. The Master Portfolio may purchase
floating- and variable-rate obligations as described in the Prospectus. The
Master Portfolio may purchase floating- and variable-rate demand notes and
bonds, which are obligations ordinarily having stated maturities in excess of
thirteen months, but which permit the holder to demand payment of principal at
any time, or at specified intervals not exceeding thirteen months. Variable
rate demand notes include master demand notes that are obligations that permit
the Master Portfolio to invest fluctuating amounts, which may change daily
without penalty, pursuant to direct arrangements between the Master Portfolio,
as lender, and the borrower. The interest rates on these notes fluctuate from
time to time. The issuer of such obligations ordinarily has a corresponding
right, after a given period, to prepay in its discretion the outstanding
principal amount of the obligations plus accrued interest upon a specified
number of days' notice to the holders of such obligations. The interest rate on
a floating-rate demand obligation is based on a known lending rate, such as a
bank's prime rate, and is adjusted automatically each time such rate is
adjusted. The interest rate on a variable-rate demand obligation is adjusted
automatically at specified intervals. Frequently, such obligations are secured
by letters of credit or other credit support arrangements provided by banks.
Because these obligations are direct lending arrangements between the lender and
borrower, it is not contemplated that such instruments generally will be traded,
and there generally is no established secondary market for these obligations,
although they are redeemable at face value. Accordingly, where these
obligations are not secured by letters of credit or other credit support
arrangements, the Master Portfolio's right to redeem is dependent on the ability
of the borrower to pay principal and interest on demand. Such obligations
frequently are not rated by credit rating agencies and the Master Portfolio may
invest in obligations which are not so rated only if BGFA determines that at the
time of investment the obligations are of comparable quality to the other
obligations in which the Master Portfolio may invest. BGFA, on behalf of the
Master Portfolio, considers on an ongoing basis the creditworthiness of the
issuers of the floating- and variable-rate demand obligations in the Master
Portfolio's portfolio. The Master Portfolio will not invest more than 10% of
the value of its total net assets in floating- or variable-rate demand
obligations whose demand feature is not exercisable within seven days. Such
obligations may be treated as liquid, provided that an active secondary market
exists.

Futures Contracts and Options on Futures Contracts. The Master Portfolio
may enter into futures contracts and may purchase and write options thereon.
Upon exercise of an option on a futures contract, the writer

3
<PAGE>

of the option delivers to the holder of the option the futures position and the
accumulated balance in the writer's futures margin account, which represents the
amount by which the market price of the futures contract 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. The potential loss related to the purchase of options
on futures contracts is limited to the premium paid for the option (plus
transaction costs). Because the value of the option is fixed at the time of
sale, there are no daily cash payments to reflect changes in the value of the
underlying contract; however, the value of the option does change daily and that
change would be reflected in the net asset value of the Master Portfolio.

Future Developments. The Master Portfolio may take advantage of
opportunities in the area of options and futures contracts and options on
futures contracts and any other derivative investments which are not presently
contemplated for use by the Master Portfolio or which are not currently
available but which may be developed, to the extent such opportunities are both
consistent with the Master Portfolio's investment objective and legally
permissible for the Master Portfolio. Before entering into such transactions or
making any such investment, the Master Portfolio will provide appropriate
disclosure in its prospectus.

Loans of Portfolio Securities. The Master Portfolio may lend securities
from its portfolio to brokers, dealers and financial institutions (but not
individuals) if cash, U.S. Government securities or other high quality debt
obligations equal to at least 100% of the current market value of the securities
loaned (including accrued interest thereon) plus the interest payable to such
Master Portfolio with respect to the loan is maintained with the Master
Portfolio. In determining whether or not to lend a security to a particular
broker, dealer or financial institution, the Master Portfolio's investment
adviser or such-adviser considers all relevant facts and circumstances,
including the size, creditworthiness and reputation of the broker, dealer, or
financial institution. Any loans of portfolio securities are fully
collateralized based on values that are marked to market daily. The Master
Portfolio does not enter into any portfolio security lending arrangements having
a duration longer than one year. Any securities that the Master Portfolio
receives as collateral do not become part of its portfolio at the time of the
loan and, in the event of a default by the borrower, the Master Portfolio will,
if permitted by law, dispose of such collateral except for such part thereof
that is a security in which the Master Portfolio is permitted to invest. During
the time securities are on loan, the borrower will pay the Master Portfolio any
accrued income on those securities, and the Master Portfolio may invest the cash
collateral and earn income or receive an agreed-upon fee from a borrower that
has delivered cash- equivalent collateral. The Master Portfolio will not lend
securities having a value that exceeds one-third of the current value of their
respective total assets. Loans of securities by the Master Portfolio are subject
to termination at the Master Portfolio's or the borrower's option. The Master
Portfolio may pay reasonable administrative and custodial fees in connection
with a securities loan and may pay a negotiated portion of the interest or fee
earned with respect to the collateral to the borrower or the placing broker.
Borrowers and placing brokers are not permitted to be affiliated, directly or
indirectly, with the Master Portfolio, BGFA or Stephens.

Investment Restrictions. The Master Portfolio has adopted investment
restrictions numbered 1 through 9 as fundamental policies. These restrictions
cannot be changed, as to the Master Portfolio, without approval by the holders
of a majority (as defined in the 1940 Act) of the Master Portfolio's outstanding
voting securities. Investment restrictions numbered 10 through 13 are not
fundamental policies and may be changed by vote of a majority of the Trustees of
MIP at any time. The Master Portfolio may not:

1. Invest more than 5% of its assets in the obligations of any single
issuer, except that up to 25% of the value of its total assets may be invested,
and securities issued or guaranteed by the U.S. Government, or its agencies or
instrumentalities may be purchased, without regard to any such limitation.

2. Hold more than 10% of the outstanding voting securities of any single
issuer. This Investment Restriction applies only with respect to 75% of its
total assets.

3. Invest in commodities, except that the Master Portfolio may purchase
and sell (i.e., write) options, forward contracts, futures contracts, including
those relating to indexes, and options on futures contracts or indexes.

4. Purchase, hold or deal in real estate, or oil, gas or other mineral
leases or exploration or development programs, but the Master Portfolio may
purchase and sell securities that are secured by real estate or issued by
companies that invest or deal in real estate.

4
<PAGE>

5. Borrow money, except to the extent permitted under the 1940 Act,
provided that the Master Portfolio may borrow up to 20% of the current value of
its net assets for temporary purposes only in order to meet redemptions, and
these borrowings may be secured by the pledge of up to 20% of the current value
of its net assets. For purposes of this investment restriction, the Master
Portfolio's entry into options, forward contracts, futures contracts, including
those relating to indexes, and options on futures contracts or indexes shall not
constitute borrowing to the extent certain segregated accounts are established
and maintained by the Master Portfolio.

6. Make loans to others, except through the purchase of debt obligations
and the entry into repurchase agreements. However, the Master Portfolio may
lend its portfolio securities in an amount not to exceed one-third of the value
of its total assets. Any loans of portfolio securities will be made according
to guidelines established by the Securities and Exchange Commission and the
MIP's Board of Trustees.

7. Act as an underwriter of securities of other issuers, except to the
extent the Master Portfolio may be deemed an underwriter under the Securities
Act of 1933, as amended, by virtue of disposing of portfolio securities.

8. Invest 25% or more of its total assets in the securities of issuers
in any particular industry or group of closely related industries and except
that there shall be no limitation with respect to investments in (i) obligations
of the U.S. Government, its agencies or instrumentalities; (ii) any industry in
which the Wilshire 4500 Index becomes concentrated to the same degree during the
same period, the Master Portfolio will be concentrated as specified above only
to the extent the percentage of its assets invested in those categories of
investments is sufficiently large that 25% or more of its total assets would be
invested in a single industry).

9. Issue any senior security (as such term is defined in Section 18(f)
of the 1940 Act), except to the extent the activities permitted in Investment
Restriction Nos. 3 and 5 may be deemed to give rise to a senior security.

10. Purchase securities on margin, but the Master Portfolio may make
margin deposits in connection with transactions in options, forward contracts,
futures contracts, including those related to indexes, and options on futures
contracts or indexes.

11. The Master Portfolio may invest in shares of other open-end
management investment companies, subject to the limitations of Section 12(d)(1)
of the 1940 Act.

12. The Master Portfolio may not invest more than 15% of the Master
Portfolio's net assets in illiquid securities. For this purpose, illiquid
securities include, among others, (a) securities that are illiquid by virtue of
the absence of a readily available market or legal or contractual restrictions
on resale, (b) fixed time deposits that are subject to withdrawal penalties and
that have maturities of more than seven days, and (c) repurchase agreements not
terminable within seven days.

13. The Master Portfolio may lend securities from its portfolio to
brokers, dealers and financial institutions, in amounts not to exceed (in the
aggregate) one-third of the Fund's total assets. Any such loans of portfolio
securities will be fully collateralized based on values that are marked to
market daily. The Master Portfolio will not enter into any portfolio security
lending arrangement having a duration of longer than one year.

5
<PAGE>

Item 14. Management of MIP.

The following information supplements and should be read in conjunction
with the Part A section entitled "Management of the Master Portfolio." The
Trustees and Principal Officer of MIP, together with information as to their
principal business occupations during at least the last five years, are shown
below. The address of each, unless otherwise indicated, is 111 Center Street,
Little Rock, Arkansas 72201. Each Trustee who is deemed to be an "interested
person" of the MIP, as defined in the 1940 Act, is indicated by an asterisk.

<TABLE>
<S> <C> <C>
Principal Occupations
Name, Address and Age Position During Past 5 Years
--------------------- -------- ---------------------
Jack S. Euphrat, 76 Trustee Private Investor.
415 Walsh Road
Atherton, CA 94027

*R. Greg Feltus, 47 Trustee, Senior Vice President of
President Stephens; President of Stephens
and Trustee, Insurance Services Inc.; Senior
Vice President of Stephens
Sports Management Inc.; and
President of Investors
Brokerage Insurance Inc.

Thomas S. Goho, 56 Trustee Associate Professor of Finance,
321 Beechcliff Court Calloway School of Business and
Winston-Salem, NC 27104 Accounting, Wake Forest
University, since 1982.

*W. Rodney Hughes, 72 Trustee Private Investor.
31 Dellwood Court
San Rafael, CA 94901

*J. Tucker Morse, 55 Trustee Chairman of Home Account
4 Beaufain Street Networks, Inc.; Real Estate
Charleston, SC 29401 Developer; Chairman of
Renaissance Properties Ltd;
President of Morse Investment
Corporation; and Co-Managing
Partner of Main Street Ventures.

Richard H. Blank, Jr., 42 Chief Operating Officer, Vice President of Stephens;
Secretary and Treasurer Director of Stephens Sports
Management Inc.; and Director of
Capo Inc.
</TABLE>

6
<PAGE>

Compensation Table
For the Fiscal Year Ended February 28, 1998

<TABLE>
<S> <C> <C>
Total Compensation
Aggregate Compensation from Registrant
Name and Position from Registrant and Fund Complex
------------------ ----------------------- --------------------

Jack S. Euphrat $0 $11,250
Trustee

*R. Greg Feltus 0 0
Trustee

Thomas S. Goho 0 11,250
Trustee

*Zoe Ann Hines/1/ 0 0
Trustee

*W. Rodney Hughes 0 11,000
Trustee

Robert M. Joses/2/ 0 1,000
Trustee

*J. Tucker Morse 0 11,000
Trustee
</TABLE>
__________________________
/1/ Zoe Ann Hines retired as of January 28, 1998.
/2/ Robert M. Joses retired as of December 31, 1997.

Trustees of MIP are compensated annually by all the registrants in the fund
complex for their services as indicated above and also are reimbursed for all
out-of-pocket expenses relating to attendance at board meetings. MIP and
MasterWorks Funds Inc. and Managed Series Investment Trust are considered to be
members of the same fund complex as such term is defined in Form N-1A under the
1940 Act (the "BGFA Fund Complex"). Stagecoach Funds, Inc., Stagecoach Trust and
Life & Annuity Trust together form a separate fund complex (the "Wells Fargo
Fund Complex"). Each of the Trustees and the principal officer of MIP serves in
the identical capacity as directors/trustees and/or officer of each registered
open-end management investment company in both the BGFA and Wells Fargo Fund
Complexes. The Trustees are compensated by other Companies and Trusts within the
fund complexes for their services as Directors/Trustees to such Companies and
Trusts. Currently the Trustees do not receive any retirement benefits or
deferred compensation from MIP or any other member of each fund complex.

As of the date of this SAI, the Trustees and Principal Officer of MIP as a
group beneficially owned less than 1% of the outstanding shares of MIP.

Item 15. Control Persons and Principal Holders of Securities.

As of February 22, 1999, Stephens Inc. ("Stephens") owned approximately
99.99% of the outstanding voting securities of the Master Portfolio. As such,
Stephens could each be considered a "controlling person" of the Master Portfolio
for purposes of the 1940 Act.

7
<PAGE>

Item 16. Investment Advisory and other Services.

The following information supplements and should be read in
conjunction with Item 5 in Part A.

Investment Adviser. Barclays Global Fund Advisors ("BGFA") provides
investment advisory services to the Master Portfolio pursuant to an Investment
Advisory Contract ("BGFA Advisory Contract") with MIP, dated October 28, 1998.
As to the Master Portfolio, the BGFA Advisory Contract is subject to annual
approval by (i) MIP's Board of Trustees or (ii) vote of a majority (as defined
in the 1940 Act) of the outstanding voting securities of the Master Portfolio,
provided that in either event the continuance also is approved by a majority of
MIP's Board of Trustees who are not "interested persons" (as defined in the 1940
Act) of MIP or BGFA, by vote cast in person at a meeting called for the purpose
of voting on such approval. As to the Master Portfolio, the BGFA Advisory
Contract is terminable without penalty, on 60 days' written notice, by either
party. The BGFA Advisory Contract will terminate automatically, as to the Master
Portfolio, in the event of its assignment (as defined in the 1940 Act).

Advisory Fees. BGFA is entitled to receive monthly fees at the annual
rate of 0.08% of the average daily net assets of the Master Portfolio as
compensation for its advisory services. From time to time, BGFA may waive such
fees in whole or in part. Any such waiver will reduce the expenses of the Master
Portfolio and, accordingly, have a favorable impact on its performance.

Co-Administrators. Stephens and Barclays Global Investors, N.A.
("BGI") are the Master Portfolio's co-administrators. Stephens and BGI provide
the Master Portfolio with administrative services, including general supervision
of the Master Portfolio's non-investment operations, coordination of the other
services provided to the Master Portfolio, compilation of information for
reports to the SEC and the state securities commissions, preparation of proxy
statements and shareholder reports, and general supervision of data compilation
in connection with preparing periodic reports to the MIP's trustees and
officers. Stephens also furnishes office space and certain facilities to conduct
the Master Portfolio's business, and compensates the MIP's trustees, officers
and employees who are affiliated with Stephens. In addition, except as outlined
below under "Expenses," Stephens and BGI will be responsible for paying all
expenses incurred by the Master Portfolio other than the fees payable to BGFA
and other than custodial fees of up to 0.01% payable after the first two years
of the Master Portfolio's operations. Stephens and BGI are entitled to receive a
monthly fee, in the aggregate, at an annual rate of 0.02% of the average daily
net assets of the Master Portfolio for providing administrative services and
assuming expenses.

Placement Agent. Stephens is the placement agent for the Master
Portfolios. Stephens is a full service broker/dealer and investment advisory
firm located at 111 Center Street, Little Rock, Arkansas 72201. Stephens and its
predecessor have been providing securities and investment services for more than
60 years, including discretionary portfolio management services since 1983.
Stephens currently manages investment portfolios for pension and profit sharing
plans, individual investors, foundations, insurance companies and university
endowments. Stephens does not receive compensation for acting as placement agent
to the Master Portfolio.

Custodian. IBT acts as the Master Portfolio's custodian. The principal
business address of IBT is 200 Clarendon Street, Boston, Massachusetts 02111.
During the first two years of the Master Portfolio's operations, IBT will be
entitled to receive compensation for its custodial services from Stephens and
BGI. Thereafter, IBT will be entitled to receive custodial fees of up to 0.01%
from the Master Portfolio.

Transfer and Dividend Disbursing Agent. IBT also acts as each Master
Portfolio's Transfer and Dividend Disbursing Agent (the "Transfer Agent"). IBT
is not entitled to receive compensation for providing such services to MIP so
long as it receives fees for providing similar services to the funds which
invest substantially all of their assets in the Master Portfolio.

Expenses. Except for extraordinary expenses, brokerage and other
expenses connected with to the execution of portfolio transactions and certain
other expenses which are borne by the Master Portfolio, Stephens and BGI have
agreed to bear all costs of the Master Portfolio's and MIP's operations.
Expenses attributable only to the Master Portfolio shall be charged only against
the assets of the Master Portfolio. General expenses of MIP shall be allocated
among its portfolios in a manner proportionate to the net assets of each, on a
transactional basis or on such other basis as the Board of Trustees deems
equitable.

8
<PAGE>

Item 17. Brokerage Allocation and Other Practices.

General. BGFA assumes general supervision over placing orders on behalf of
the Master Portfolio for the purchase or sale of portfolio securities.
Allocation of brokerage transactions, including their frequency, is made in the
best judgment of BGFA and in a manner deemed fair and reasonable to
interestholders. In executing portfolio transactions and selecting brokers or
dealers, BGFA seeks to obtain the best overall terms available for the Master
Portfolio. In assessing the best overall terms available for any transaction,
BGFA considers factors deemed relevant, including the breadth of the market in
the security, the price of the security, the financial condition and execution
capability of the broker or dealer, and the reasonableness of the commission, if
any, both for the specific transaction and on a continuing basis. The primary
consideration is prompt execution of orders at the most favorable net price.
Certain of the brokers or dealers with whom the Master Portfolio may transact
business offer commission rebates to the Master Portfolio. BGFA considers such
rebates in assessing the best overall terms available for any transaction. The
overall reasonableness of brokerage commissions paid is evaluated by BGFA based
upon its knowledge of available information as to the general level of
commissions paid by other institutional investors for comparable services.
Brokers also are selected because of their ability to handle special executions
such as are involved in large block trades or broad distributions, provided the
primary consideration is met. Portfolio turnover may vary from year to year, as
well as within a year. High turnover rates over 100% are likely to result in
comparatively greater brokerage expenses.

Item 18. Capital Stock and Other Securities.

Pursuant to MIP's Declaration of Trust, the Trustees are authorized to
issue shares of beneficial interests in each Master Portfolio. Investors in a
Master Portfolio are entitled to participate pro rata in distributions of
taxable income, loss, gain and credit of such Master Portfolio. Upon
liquidation or dissolution of a Master Portfolio, investors are entitled to
share pro rata in the Master Portfolio's net assets available for distribution
to its investors. Investments in a Master Portfolio have no preference, pre-
exemptive, conversion or similar rights and are fully paid and non-assessable,
except as set forth below. Investments in the Master Portfolio may not be
transferred. No certificates are issued.

Each investor is entitled to vote, with respect to matters affecting each
of MIP's portfolios, in proportion to the amount of its investment in the MIP.
Investors in the MIP do not have cumulative voting rights, and investors holding
more than 50% of the aggregate beneficial interest in MIP may elect all of the
Trustees of MIP if they choose to do so and in such event the other investors in
MIP would not be able to elect any Trustee. MIP is not required to hold annual
meetings of investors but MIP may hold special meetings of investors when in the
judgment of MIP's Trustees it is necessary or desirable to submit matters for an
investor vote.

Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of an investment
company, such as MIP, will not be deemed to have been effectively acted upon
unless approved by the holders of a majority of the outstanding shares of each
Master Portfolio affected by such matter. Rule 18f-2 further provides that a
Master Portfolio shall be deemed to be affected by a matter unless it is clear
that the interests of such Master Portfolio in the matter are identical or that
the matter does not affect any interest of such Master Portfolio. However, the
Rule exempts the selection of independent accountants and the election of
Trustees from the separate voting requirements of the Rule.

Item 19. Purchase, Redemption and Pricing Of Securities.

The following information supplements and should be read in conjunction
with Items 7 and 8 in Part A.

Purchase of Securities. Beneficial interests in the Master Portfolio are
issued solely in private placement transactions which do not involve any "public
offering" within the meaning of Section 4(2) of the Securities Act of 1933, as
amended (the "1933 Act"). Investments in the Master Portfolio may only be made
by investment companies or certain other entities which are "accredited
investors" within the meaning of Regulation D under the 1933 Act. This
registration statement does not constitute an offer to sell, or the solicitation
of an offer to buy, any "security" within the meaning of the 1933 Act.

9
<PAGE>

Payment for shares of the Master Portfolio may, at the discretion of the
adviser, be made in the form of securities that are permissible investments for
the Master Portfolio and must meet the investment objective, policies and
limitations of the Master Portfolio as described in the Part A. In connection
with an in-kind securities payment, the Master Portfolio may require, among
other things, that the securities (i) be valued on the day of purchase in
accordance with the pricing methods used by the Master Portfolio; (ii) are
accompanied by satisfactory assurance that the Master Portfolio will have good
and marketable title to such securities received by it; (iii) are not subject to
any restrictions upon resale by the Master Portfolio; (iv) be in proper form for
transfer to the Master Portfolio; and (v) are accompanied by adequate
information concerning the basis and other tax matters relating to the
securities. All dividends, interest, subscription or other rights pertaining to
such securities shall become the property of the Master Portfolio engaged in the
in-kind purchase transaction and must be delivered to such Master Portfolio by
the investor upon receipt from the issuer. Securities acquired through an in-
kind purchase will be acquired for investment and not for immediate resale.
Shares purchased in exchange for securities generally cannot be redeemed until
the transfer has settled.

Suspension of Redemptions. The right of redemption of Master Portfolio
shares may be suspended or the date of payment postponed (a) during any period
when the New York Stock Exchange is closed (other than customary weekend and
holiday closings), (b) when trading in the markets the Master Portfolios
ordinarily utilizes is restricted, or when an emergency exists as determined by
the Securities and Exchange Commission so that disposal of the Master
Portfolios' investments or determination of its net asset value is not
reasonably practicable, or (c) for such other periods as the Securities and
Exchange Commission by order may permit to protect the Master Portfolio's
interestholders.

Pricing of Securities.

The securities of the Master Portfolio, including covered call options
written by the Master Portfolio, are valued as discussed below. Domestic
securities are valued at the last sale price on the domestic securities or
commodities exchange or national securities market on which such securities
primarily are traded. Securities not listed on a domestic exchange or national
securities market, or securities in which there were no transactions, are valued
at the most recent bid prices. Portfolio securities which are traded primarily
on foreign securities or commodities exchanges generally are valued at the
preceding closing values of such securities on their respective exchanges,
except that when an occurrence subsequent to the time a value was so established
is likely to have changed such value, then the fair value of those securities is
determined by BGFA in accordance with guidelines approved by MIP's Board of
Trustees. Short-term investments are carried at amortized cost, which
approximates value. Any securities or other assets for which recent market
quotations are not readily available are valued at fair value as determined in
good faith by BGFA in accordance with such guidelines.

Restricted securities, as well as securities or other assets for which
market quotations are not readily available, or are not valued by a pricing
service approved by MIP's Board of Trustees, are valued at fair value as
determined in good faith by BGFA in accordance with guidelines approved by MIP's
Board of Trustees. BGFA and MIP's Board of Trustees periodically review the
method of valuation. In making its good faith valuation of restricted
securities, BGFA generally takes the following factors into consideration:
restricted securities which are, or are convertible into, securities of the same
class of securities for which a public market exists usually will be valued at
market value less the same percentage discount at which purchased. This
discount is revised periodically if it is believed that the discount no longer
reflects the value of the restricted securities. Restricted securities not of
the same class as securities for which a public market exists usually are valued
initially at cost. Any subsequent adjustment from cost is based upon
considerations deemed relevant by MIP's Board of Trustees.

New York Stock Exchange Closings. The holidays on which the New York Stock
Exchange is closed currently are: New Year's Day, Martin Luther King, Jr.'s
Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day and Christmas Day.

10
<PAGE>

Item 20. Tax Status.

MIP is organized as a business trust under Delaware law. Under MIP's
current classification for federal income tax purposes, it is intended that each
Master Portfolio will be treated as a partnership for such purposes and,
therefore, such Master Portfolio will not be subject to any federal income tax.
However, each investor in a Master Portfolio will be taxable on its share (as
determined in accordance with the governing instruments of MIP) of such Master
Portfolio's ordinary income and capital gain in determining its federal income
tax liability. The determination of such share will be made in accordance with
the Internal Revenue Code of 1986, as amended (the "Code"), and regulations
promulgated thereunder.

MIP's taxable year-end is the last day of December. Although MIP will not
be subject to federal income tax, it will file appropriate federal income tax
returns.

The Master Portfolio's assets, income and distributions will be managed in
such a way that an investor in the Master Portfolio may satisfy the requirements
of Subchapter M of the Code, by investing substantially all of its investable
assets in the Master Portfolio. Investors are advised to consult their own tax
advisors as to the tax consequences of an investment in the Master Portfolio.

Item 21. Underwriters.

The exclusive placement agent for MIP is Stephens, which receives no
compensation for serving in this capacity. Registered broker/dealers and
investment companies, insurance company separate accounts, common and commingled
trust funds, group trust and similar organizations and entities which constitute
accredited investors, as defined in the regulations adopted under the 1933 Act,
may continuously invest in a Master Portfolio of MIP.

Item 22. Calculations Of Performance Data.

Not applicable.

Item 23. Financial Information.

KPMG LLP provides audit services, tax services and assistance and
consultation in connection with the review of certain SEC filings. KPMG LLP's
address is Three Embarcadero Center, San Francisco, California 94111. For the
fiscal year ended February 28, 1995, MIP's financial statements were audited by
other independent auditors. Such auditors expressed an unqualified opinion on
the financial statements of the MIP.

11
<PAGE>

APPENDIX

Description of certain ratings assigned by Standard & Poor's Corporation
("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch Investors Service,
Inc. ("Fitch"), Duff & Phelps, Inc. ("Duff") and IBCA Inc. and IBCA Limited
("IBCA"):

S&P

Bond Ratings

"AAA"

Bonds rated AAA have the highest rating assigned by S&P. Capacity to pay
interest and repay principal is extremely strong.

"AA"

Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.

"A"

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

"BBB"

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

S&P's letter ratings may be modified by the addition of a plus (+) or minus
(-) sign designation, which is used to show relative standing within the major
rating categories, except in the AAA (Prime Grade) category.

Commercial Paper Rating

The designation A-1 by S&P indicates that the degree of safety regarding
timely payment is either overwhelming or very strong. Those issues determined
to possess overwhelming safety characteristics are denoted with a plus sign (+)
designation. Capacity for timely payment on issues with an A-2 designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.

Moody's

Bond Ratings

"Aaa"

Bonds which are 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." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.

A-1
<PAGE>

"Aa"

Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what generally are known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa securities.

"A"

Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving security
to principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.

"Baa"

Bonds which are 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 characteristics and in
fact have speculative characteristics as well.

Moody's applies the numerical modifiers "1", "2" and "3" to show relative
standing within the major rating categories, except in the "Aaa" category. The
modifier "1" indicates a ranking for the security in the higher end of a rating
category; the modifier "2" indicates a mid-range ranking; and the modifier "3"
indicates a ranking in the lower end of a rating category.

Commercial Paper Rating

The rating ("P-1") Prime-1 is the highest commercial paper rating assigned
by Moody's. Issuers of "P-1" paper must have a superior capacity for repayment
of short-term promissory obligations, and ordinarily will be evidenced by
leading market positions in well established industries, high rates of return on
funds employed, conservative capitalization structures with moderate reliance on
debt and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established access
to a range of financial markets and assured sources of alternate liquidity.

Issuers (or relating supporting institutions) rated ("P-2") Prime-2 have a
strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternate liquidity is
maintained.

Fitch

Bond Ratings

The ratings represent Fitch's assessment of the issuer's ability to meet
the obligations of a specific debt issue or class of debt. The ratings take
into consideration special features of the issue, its relationship to other
obligations of the issuer, the current financial condition and operative
performance of the issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future financial strength
and credit quality.

"AAA"

Bonds rated "AAA" are considered to be investment grade and of the highest
credit quality. The obligor has an exceptionally strong ability to pay interest
and repay principal, which is unlikely to be affected by reasonably foreseeable
events.

A-2
<PAGE>

"AA"

Bonds rated "AA" are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal is
very strong, although not quite as strong as bonds rated "AAA". Because bonds
rated in the "AAA" and "AA" categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issuers is generally
rated "F-1+".

"A"

Bonds rated "A" are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.

"BBB"

Bonds rated "BBB" are considered to be investment grade and of satisfactory
credit quality. The obligor's ability to pay interest and repay principal is
considered to be adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have an adverse impact on these bonds
and, therefore, impair timely payment. The likelihood that the ratings of these
bonds will fall below investment grade is higher than for bonds with higher
ratings.

Plus (+) and minus (-) signs are used with a rating symbol to indicate the
relative position of a credit within the rating category.

Short-Term Ratings

Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of up to three years, including commercial
paper, certificates of deposit, medium-term notes, and municipal and investment
notes.

Although the credit analysis is similar to Fitch's bond rating analysis,
the short-term rating places greater emphasis than bond ratings on the existence
of liquidity necessary to meet the issuer's obligations in a timely manner.

"F-1+"

Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.

"F-1"

Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F-1+.

"F-2"

Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.

A-3
<PAGE>

Duff

Bond Ratings

"AAA"

Bonds rated AAA are considered highest credit quality. The risk factors
are negligible, being only slightly more than for risk-free U.S. Treasury debt.

"AA"

Bonds rated AA are considered high credit quality. Protection factors are
strong. Risk is modest but may vary slightly from time to time because of
economic conditions.

"A"

Bonds rated A have protection factors which are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress.

"BBB"

Bonds rated BBB are considered to have below average protection factors but
still considered sufficient for prudent investment. Considerable variability in
risk during economic cycles.

Plus (+) and minus (-) signs are used with a rating symbol (except AAA) to
indicate the relative position of a credit within the rating category.

Commercial Paper Rating

The rating "Duff-1" is the highest commercial paper rating assigned by
Duff. Paper rated Duff-1 is regarded as having very high certainty of timely
payment with excellent liquidity factors which are supported by ample asset
protection. Risk factors are minor. Paper rated "Duff-2" is regarded as having
good certainty of timely payment, good access to capital markets and sound
liquidity factors and company fundamentals. Risk factors are small.

IBCA

Bond and Long-Term Ratings

Obligations rated AAA by IBCA have the lowest expectation of investment
risk. Capacity for timely repayment of principal and interest is substantial,
such that adverse changes in business, economic or financial conditions are
unlikely to increase investment risk significantly. Obligations for which there
is a very low expectation of investment risk are rated AA by IBCA. Capacity for
timely repayment of principal and interest is substantial. Adverse changes in
business, economic or financial conditions may increase investment risk albeit
not very significantly.

Commercial Paper and Short-Term Ratings

The designation A1 by IBCA indicates that the obligation is supported by a
very strong capacity for timely repayment. Those obligations rated A1+ are
supported by the highest capacity for timely repayment. Obligations rated A2 are
supported by a strong capacity for timely repayment, although such capacity may
be susceptible to adverse changes in business, economic or financial conditions.

A-4
<PAGE>

International and U.S. Bank Ratings

An IBCA bank rating represents IBCA's current assessment of the strength of
the bank and whether such bank would receive support should it experience
difficulties. In its assessment of a bank, IBCA uses a dual rating system
comprised of Legal Ratings and Individual Ratings. In addition, IBCA assigns
banks Long- and Short-Term Ratings as used in the corporate ratings discussed
above. Legal Ratings, which range in gradation from 1 through 5, address the
question of whether the bank would receive support provided by central banks or
shareholders if it experienced difficulties, and such ratings are considered by
IBCA to be a prime factor in its assessment of credit risk. Individual Ratings,
which range in gradations from A through E, represent IBCA's assessment of a
bank's economic merits and address the question of how the bank would be viewed
if it were entirely independent and could not rely on support from state
authorities or its owners.

A-5
<PAGE>

MASTER INVESTMENT PORTFOLIO

U.S. EQUITY INDEX MASTER PORTFOLIO

PART A

FEBRUARY 22, 1999

Responses to Items 1 through 3 have been omitted pursuant to paragraph 4 of
Instruction F of the General Instructions to Form N-1A.

ITEM 4. GENERAL DESCRIPTION OF REGISTRANT.

General. Master Investment Portfolio ("MIP") is an open-end, management
investment company, organized on October 21, 1993 as a business trust under the
laws of the State of Delaware. MIP is a "series fund," which is a mutual fund
divided into separate portfolios. By this offering document, MIP is offering
one of its diversified portfolios - the U.S. Equity Index Master Portfolio (the
"Master Portfolio"). The Master Portfolio is treated as a separate entity for
certain matters under the Investment Company Act of 1940, as amended (the "1940
Act"), and for other purposes, and an interestholder of the Master Portfolio is
not deemed to be an interestholder of any other portfolio of MIP. As described
below, for certain matters MIP interestholders vote together as a group; as to
others they vote separately by portfolio. MIP currently offers eleven other
portfolios pursuant to other offering documents. From time to time, other
portfolios may be established and sold pursuant to other offering documents.

Beneficial interests in the Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering" within
the meaning of Regulation D under the Securities Act of 1933, as amended (the
"1933 Act"). Investments in the Master Portfolio may be made only by investment
companies or certain other entities which are "accredited investors" within the
meaning of Regulation D under the 1933 Act. Investment companies that hold units
of beneficial interest ("interests") in the Master Portfolio are sometimes
referred to herein as "feeder funds."

INVESTMENT OBJECTIVE - Master Portfolio.

. The U.S. Equity Index Master Portfolio seeks to match as closely as
practicable, before fees and expenses, the performance of the Wilshire
5000 Equity Index (the "Wilshire 5000 Index")./1/ The Master
Portfolio uses a "fund of funds" structure to track the Wilshire 5000
Index, which is comprised of the stocks in the Standard & Poor's 500
Stock Index ("S&P 500 Index"), except for a small number of foreign
stocks that represent approximately 3% of the S&P 500 Index, and the
stocks in the Wilshire 4500 Equity Index (the "Wilshire 4500 Index").
In this regard, the Master Portfolio seeks to achieve its objective by
investing substantially all of its assets in two other portfolios of
MIP -- the Extended Index Portfolio (which invests substantially all
of its assets in a representative sample of stocks comprising the
Wilshire 4500 Index) and the S&P 500 Index Portfolio (which invests
substantially all of its assets in stocks comprising the S&P 500
Index) (together, the "Underlying Portfolios"). The Master Portfolio's
assets will be invested in the Underlying Portfolios of MIP in
proportions adjusted periodically to maintain the capitalization range
of the Wilshire 5000 Index. The performance of the Master Portfolio
will correspond directly to the performance of the Underlying
Portfolios. The Fund may not track its index perfectly, as
differences between the index and the Fund's Underlying Portfolios may
cause differences in performance.

- ------------------------
/1/ McGraw-Hill, Inc. ("McGraw-Hill") and Wilshire Associates, Inc. ("Wilshire
Associates") do not sponsor any portfolios of MIP, nor are they affiliated in
any way with BGFA or MIP. "Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," and
"Standard & Poor's 500(R)" are trademarks of McGraw-Hill. "Wilshire 5000 Equity
Index(R)" and "Wilshire 4500 Equity Index(R)" and related marks are trademarks
of Wilshire Associates. None of the portfolios of MIP are sponsored, endorsed,
sold, or promoted by these indices or their sponsors and neither the indices nor
their sponsors make any representation or warranty, express or implied,
regarding the advisability of investing in MIP portfolios.
<PAGE>

INVESTMENT OBJECTIVES - Underlying Portfolios.

. The S&P 500 Index Portfolio seeks to provide investment results,
before fees and expenses, that correspond to the total return
performance of publicly traded common stocks in the aggregate, as
represented by the Standard & Poor's 500 Stock Index.

. The Extended Index Portfolio seeks to approximate, before fees and
expenses, the capitalization range and performance of the Wilshire
4500 Index.

ABOUT THE INDICES

. The Wilshire 5000 Index was created December 31, 1980. It measures
the performance of all U.S. headquartered equity securities with
readily available price data. Over 7,000 capitalization weighted
security returns are used to adjust the index.

. The Wilshire 4500 Index was created December 31, 1983. It is the
Wilshire 5000 Index with most of the companies in the S&P 500 Index
removed. Over 6,500 capitalization weighted security returns are used
to adjust the index.

. The S&P 500 Index was created March 5, 1957. It is composed of 500
selected common stocks, most of which are listed on the NYSE.

The securities comprising the S&P 500 Index represent the stocks of
primarily large-cap companies. The securities comprising the Wilshire 4500
Index represent the smaller- and medium-sized companies of the Wilshire 5000
Index. In order for the Master Portfolio to maintain a capitalization weighted
representative sample of the Wilshire 5000 Index, it will invest in the
Underlying Portfolios in proportion to the overall capitalization of their
respective indices. Based on their relative overall capitalizations as of the
date of this Part A, roughly two thirds of the Master Portfolio's portfolio will
be invested in the S&P 500 Index Portfolio and the other third in the Extended
Index Portfolio. Historically, the overall capitalization of the indices have
varied, and as a result, the Master Portfolio's portfolio is also likely to
vary.

INVESTMENT POLICIES - Master Portfolio.

. The U.S. Equity Index Master Portfolio seeks to match the total return
performance of the Wilshire 5000 Index, which is composed of over
7,000 selected common stocks traded on the New York Stock Exchange,
American Stock Exchange and Nasdaq Stock Market.
<PAGE>

The weightings of stocks in the Wilshire 5000 Index are based on each
stock's relative total market capitalization; that is, its market
price per share times the number of shares outstanding. The percentage
of the Master Portfolio's assets invested in the Underlying Portfolios
is approximately the same as the percentage such Portfolios are
invested in stocks represented in the Wilshire 5000 Index. Securities
are selected for investment by the Underlying Portfolios as indicated
below.

INVESTMENT POLICIES - Underlying Portfolios.

. The Extended Index Portfolio seeks to match the total return
performance of U.S. stocks, excluding the large-cap stocks included in
the S&P 500 Index. The Fund defines these stocks as those comprising
the Wilshire 4500 Index, which is composed of over 6,500 equity stocks
of issuers headquartered in the United States. The Index is almost
entirely comprised of common stocks listed on the New York Stock
Exchange, American Stock Exchange or Nasdaq Stock Market. The
weightings of stocks in the Wilshire 4500 Index are based on each
stock's relative total market capitalization; that is, its market
price per share times the number of shares outstanding. The Extended
Index Portfolio invests in a representative sample of these
securities. Securities are selected for investment by the Extended
Index Portfolio in accordance with their capitalization, industry
sector and valuation, among other factors.

. The S&P 500 Index Portfolio seeks to match the total return
performance of the S&P 500 Index, which is composed of 500 selected
common stocks, most of which are listed on the New York Stock
Exchange. The weightings of stocks in the S&P 500 Index are based on
each stock's relative total market capitalization; that is, its market
price per share times the number of shares outstanding. The
percentage of the S&P 500 Index Portfolio's assets invested in a given
stock is approximately the same as the percentage such stock
represents in the S&P 500 Index.

Unlike the Extended Index Portfolio, which invests in a representative
sample of the over 6,500 stocks represented by its benchmark, the Wilshire 4500
Index, the S&P 500 Index Portfolio invests in all 500 of the stocks represented
by its benchmark, the S&P 500 Index.

No attempt is made to manage the portfolio of the Master Portfolio
using economic, financial or market analysis. The Master Portfolio is managed
by determining which proportion of its assets will be invested in each
Underlying Portfolio to match, to the extent feasible, the capitalization range
and returns of the Wilshire 5000 Index. In turn, the Underlying Portfolios
determine which securities are to be purchased or sold to match or sample their
respective benchmarks. Under normal market conditions, at least 90% of the
value of the Master Portfolio's total assets is invested, through the Underlying
Portfolios, in securities comprising the Wilshire 5000 Index. The Master
Portfolio's ability to match its investment performance to the investment
performance of the Wilshire 5000 Index may be affected by, among other things,
the Master Portfolio's and Underlying Portfolios' expenses, the amount of cash
and cash equivalents held by the Master Portfolio and the Underlying Portfolios,
the manner in which the total returns of the Wilshire 5000 Index, the Wilshire
4500 Index and the S&P 500 Index are calculated; the size of the Master
Portfolio's investment portfolio; and the timing, frequency and size of
shareholder purchases and redemptions.

The Underlying Portfolios use cash flows from interestholder purchase
and redemption activity to maintain, to the extent feasible, the similarity of
their portfolio to the securities comprising their respective benchmarks. In
turn, the Master Portfolio uses cash flows from its interestholder purchase and
redemption activity to periodically adjust its investment in the Underlying
Portfolios to maintain, to the extent feasible, the similarity of its
capitalization range and returns to those of the securities comprising the
Wilshire 5000 Index. Barclays Global Fund Advisors ("BGFA") regularly monitors
the Master Portfolio's correlation to the Wilshire 5000 Index and adjusts the
Master Portfolio's investment in the Underlying Portfolios to the extent
necessary. Inclusion of a
<PAGE>

security in an Index in no way implies an opinion by the sponsor of the Index as
to its attractiveness as an investment.

The sampling techniques utilized by the Master Portfolio and the
Extended Index Portfolio are designed to allow said portfolios to substantially
duplicate the investment performance of their respective benchmarks. However,
the Master Portfolio is not expected to track the Wilshire 5000 Index with the
same degree of accuracy that complete replication of such Index would provide.
In addition, at times, the portfolio composition of the Master Portfolio may be
altered (or "rebalanced") to reflect changes in the characteristics of the
Wilshire 5000 Index, primarily by adjusting the Master Portfolio's investment in
the Underlying Portfolios. The S&P 500 Index seeks to replicate completely the
investments and capitalization range of the S&P 500 Index.

The investment policies, strategies, techniques and restrictions
employed by the Master Portfolio in pursuing its investment objective vis-a-vis
the Wilshire 5000 Index are substantially similar to those employed by the
Underlying Portfolios in pursuing their respective investment objectives vis-a-
vis their respective benchmarks. Unless otherwise indicated, references to the
investment policies, strategies, techniques and restrictions of the Master
Portfolio also are references to the investment policies, strategies, techniques
and restrictions of the Underlying Portfolios in which the Master Portfolio
invests substantially all of its assets.

In seeking to match the performance of the Wilshire 5000 Index, the
Master Portfolio also may engage in futures and options transactions and other
derivative securities transactions and lend its portfolio securities, each of
which involves risk. The Master Portfolio attempts to be fully invested at all
times in securities comprising the Wilshire 5000 Index and in futures contracts
and options on futures contracts, although the Master Portfolio may invest up to
10% of its assets in high-quality money market instruments to provide liquidity.
The Master Portfolio also may invest up to 15% of the value of its net assets in
illiquid securities, including repurchase agreements providing for settlement in
more than seven days. See Item 13, "Investment Objective and Policies --
Investment Restrictions," in Part B.

CERTAIN FUNDAMENTAL POLICIES. The Master Portfolio may (i) borrow money to the
extent permitted under the 1940 Act (for purposes of this investment
restriction, the Master Portfolio's entry into options, forward contracts,
futures contracts, including those relating to indices, and options on futures
contracts or indices, shall not constitute borrowing to the extent certain
segregated accounts are established and maintained by the Master Portfolio);
(ii) invest up to 5% of its total assets in the securities of any single issuer,
except that up to 25% of the value of the total assets of the Master Portfolio
may be invested without regard to this limitation, and obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities may be
purchased without regard to this limitation; and (iii) invest up to 25% of the
value of its total assets in the securities of issuers in a particular industry
or group of closely related industries, subject to certain exceptions specified
in Part B, including that there is no limitation on the purchase of obligations
issued or guaranteed by the U.S. Government, its agencies or instrumentalities.
This paragraph describes fundamental policies that cannot be changed without
approval by the holders of a majority (as defined in the 1940 Act) of the Master
Portfolio's outstanding voting securities. See Item 13, "Investment Objective
and Policies -- Investment Restrictions," in Part B.

RISK CONSIDERATIONS.

General -- The value of the Master Portfolio's interests is neither
insured nor guaranteed, is not fixed and should be expected to fluctuate.

Equity Securities -- The stock investments of the Master Portfolio are subject
to equity market risk. Equity market risk is the possibility that common stock
prices will fluctuate or decline over short or even extended periods. The U.S.
stock market tends to be cyclical, with periods when stock prices generally rise
and periods when prices generally decline. In addition, many of the companies
whose securities comprise the Wilshire 4500 Index are small- to medium-sized
companies which, historically, have been more susceptible to market fluctuations
than securities of larger capitalization companies such as those comprising the
S&P 500 Index. As of
<PAGE>

the date of this registration statement, the U.S. stock market, as measured by
the Wilshire 5000 Index and other commonly used indices, was trading at or close
to record levels. There can be no assurance that these record levels will
continue.

Debt Securities -- The debt instruments in which the Master Portfolio may invest
are subject to credit and interest rate risk. Credit risk is the risk that
issuers of debt instruments may default on the payment of principal and/or
interest. Interest-rate risk is the risk that increases in market interest
rates may adversely affect the value of debt instruments. The value of the debt
instruments generally changes inversely to market interest rates. Debt
securities with longer maturities, which tend to produce higher yields, are
subject to potentially greater capital appreciation and depreciation than
obligations with shorter maturities. Changes in the financial strength of an
issuer or changes in the ratings of any particular security may also affect the
value of debt instruments. Although some debt instruments are guaranteed by the
U.S. Government, its agencies or instrumentalities, such instruments are subject
to interest rate risk and the market value of these instruments will fluctuate.
No assurance can be given that the U.S. Government would provide financial
support to the agencies or instrumentalities that issue or guarantee these
instruments where it is not obligated to do so.

Other Investment Considerations -- The Master Portfolio may enter into
transactions in futures contracts and options on futures contracts, each of
which involves risk. The futures contracts and options on futures contracts
that the Master Portfolio may purchase may be considered derivatives.
Derivatives are financial instruments whose values are derived, at least in
part, from the prices of other securities or specified assets, indices or rates.
The Master Portfolio intends to use futures contracts and options thereon as
part of its short-term liquidity holdings and/or substitutes for comparable
market positions in the underlying securities. Some derivatives may be more
sensitive than direct securities to changes in interest rates or sudden market
moves. Some derivatives also may be susceptible to fluctuations in yield or
value due to their structure or contract terms.

Year 2000 -- Many computer software systems in use today cannot distinguish the
Year 2000 from the Year 1900. Most of the services provided to the Master
Portfolio and the Underlying Portfolios depend on the smooth functioning of
computer systems. Any failure to adapt these systems in time could hamper the
operations and services of said portfolios. The principal service providers to
said portfolios have advised that they are working on necessary changes to their
systems and that they expect their systems to be adapted in time. There can, of
course, be no assurance of success. In addition, because the Year 2000 issue
affects virtually all organizations, the companies or entities in which said
portfolios invest also could be adversely impacted by the Year 2000 issue. The
extent of such impact cannot be predicted.

Item 5. Management of the Master Portfolio.

INVESTMENT ADVISER -- BGFA serves as investment adviser to the Master Portfolio
and the Underlying Portfolios. BGFA is a direct subsidiary of Barclays Global
Investors, N.A. (which, in turn, is an indirect subsidiary of Barclays Bank PLC
("Barclays")) and is located at 45 Fremont Street, San Francisco, CA 94105. As
of November 30, 1998, BGFA and its affiliates provided investment advisory
services for approximately $569 billion of assets under management.

BGFA provides the Master Portfolio and the Underlying Portfolios with
investment guidance and policy direction in connection with the daily portfolio
management of each, subject to the supervision of MIP's Board of Trustees and in
conformity with Delaware law and the stated policies of each such portfolio.
BGFA furnishes to MIP's Board of Trustees periodic reports on the investment
strategy and performance of the Master Portfolio and the Underlying Portfolios.

BGFA is entitled to receive monthly fees at the annual rate of 0.01%
of the average daily net assets of the Master Portfolio, 0.08% of the average
daily net assets of the Extended Index Portfolio and 0.05% of the average daily
net assets of the S&P 500 Index Portfolio as compensation for its advisory
services. The Master Portfolio bears its pro rata share of the advisory fees of
the Underlying Portfolios. Based on these fee levels and the
<PAGE>

expected allocation of assets between the two Underlying Portfolios, the
advisory fees payable to BGFA by the Master Portfolio on a combined basis will
be approximately 0.07% of the average daily net assets of the Master Portfolio.
From time to time, BGFA may waive such fees in whole or in part. Any such waiver
will reduce the expenses of the Master Portfolio and, accordingly, have a
favorable impact on its performance.

CO-ADMINISTRATORS -- Stephens Inc. ("Stephens") and Barclays Global Investors,
N.A. ("BGI") are the Master Portfolio's co-administrators. Stephens and BGI
provide the Master Portfolio with administrative services, including general
supervision of the Master Portfolio's non-investment operations, coordination of
the other services provided to the Master Portfolio, compilation of information
for reports to the SEC and the state securities commissions, preparation of
proxy statements and interestholder reports, and general supervision of data
compilation in connection with preparing periodic reports to the MIP's trustees
and officers. Stephens also furnishes office space and certain facilities to
conduct the Master Portfolio's business, and compensates the MIP's trustees,
officers, and employees who are affiliated with Stephens. In addition, except as
outlined below under "Expenses," Stephens and BGI will be responsible for paying
all expenses incurred by the Master Portfolio other than the fees payable to
BGFA and other than custodial fees of up to 0.01% payable after the first two
years of the Master Portfolio's operations. Stephens and BGI are entitled to
receive a monthly fee, in the aggregate, at an annual rate of 0.01% of the
average daily net assets of the Master Portfolio for providing administration
services and assuming expenses. Stephens and BGI serve in the same capacity for
the Underlying Portfolios and are entitled to receive a monthly fee, in the
aggregate, at an annual rate of 0.02% of the average daily net assets of the
Extended Index Portfolio for providing administrative services and assuming
expenses. The Co-Administrators are not entitled to receive administrative fees
for the S&P 500 Index Portfolio. The Master Portfolio bears its pro rata share
of the administrative fees of the Underlying Portfolios.

PLACEMENT AGENT -- Stephens is the placement agent for the Master Portfolio and
the Underlying Portfolios. Stephens is a full service broker/dealer and
investment advisory firm located at 111 Center Street, Little Rock, Arkansas
72201. Stephens and its predecessor have been providing securities and
investment services for more than 60 years, including discretionary portfolio
management services since 1983. Stephens currently manages investment portfolios
for pension and profit sharing plans, individual investors, foundations,
insurance companies and university endowments. Stephens does not receive
compensation for acting as placement agent to the Master Portfolio or the
Underlying Portfolios.
<PAGE>

CUSTODIAN -- IBT currently acts as custodian to the Master Portfolio and the
Underlying Portfolios. The principal business address of IBT is 200 Clarendon
Street, Boston, Massachusetts 02111. During the first two years of the Master
Portfolio's operations, IBT will be entitled to receive compensation for its
custodial services from Stephens and BGI. Thereafter, IBT will be entitled to
receive custodial fees up to 0.01% from the Master Portfolio. The Master
Portfolio bears its pro rata share of the Custodial fees of the Underlying
Portfolios.

TRANSFER AGENT -- IBT also acts as Transfer and Dividend Disbursing Agent (the
"Transfer Agent") to the Master Portfolio and the Underlying Portfolios. IBT
does not receive compensation for acting as Transfer Agent to the Master
Portfolio or the Underlying Portfolios.

Item 6. Capital Stock and Other Securities.

ORGANIZATION AND INTERESTS

MIP is organized as a business trust under the laws of the State of
Delaware. Investors in MIP are each liable for all obligations of MIP. However,
the risk of an investor incurring financial loss on account of such liability is
limited to circumstances in which both inadequate insurance existed and itself
was unable to meet its obligations.

Unless otherwise required by the 1940 Act, MIP generally will not hold
annual meetings of interestholders. As a result, interestholders will not
consider each year the election of Trustees or the appointment of auditors.
However, the holders of at least 10% of the securities outstanding and entitled
to vote may require MIP to hold a special meeting of interestholders for
purposes of removing a Trustee from office. MIP interestholders may remove a
Trustee by the affirmative vote of sixty-six and two thirds percent of MIP's
outstanding interests entitled to vote thereon. In addition, the Board of
Trustees will call a meeting of interestholders for the purpose of electing
Trustees if, at any time, less than a majority of the Trustees then holding
office have been elected by
<PAGE>

interestholders. Investments in the Master Portfolio may not be transferred, but
an investor may redeem all or any portion of its investment at any time at net
asset value.

TAXES

MIP believes that the Master Portfolio will qualify as a non-publicly
traded partnership for federal income tax purposes. MIP therefore believes that
the Master Portfolio will not be subject to any federal income tax on its income
and net capital gains (if any). However, each investor in the Master Portfolio
will be taxable on its distributive share of the Master Portfolio's taxable
income in determining its federal income tax liability. As a non-publicly traded
partnership, the Master Portfolio will be deemed to have "passed through" to
interest holders any interests, dividends, gains or losses. The determination of
such share will be made in accordance with the Internal Revenue Code of 1986, as
amended (the "Code"), and regulations promulgated thereunder.

Investor inquiries should be directed to Master Investment Portfolio, 111
Center Street, Little Rock, Arkansas 72201.

Item 7. Purchase of Interests.

Beneficial interests in the Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering" within
the meaning of Section 4(2) of the 1933 Act. Investments in the Master
Portfolio may be made only by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
Securities Act of 1933, as amended.

Interests in the Master Portfolio are sold at the net asset value per
unit of beneficial interest ("NAV") next determined after an order in proper
form is received by MIP. NAV for the Master Portfolio is determined as of the
close of trading of the New York Stock Exchange (currently 4:00 p.m., Eastern
Standard Time), on each day the New York Stock Exchange is open for business (a
"Business Day"). NAV is computed by dividing the value of the Master Portfolio's
net assets (i.e., the value of its assets less liabilities) by the total number
of interests in the Master Portfolio outstanding. The Master Portfolio's
investments are valued each Business Day generally by using available market
quotations or at fair value determined in good faith by MIP's Board of Trustees.
For further information regarding the methods employed in valuing the Master
Portfolio's investments, see Item 19, "Purchase, Redemption and Pricing of
Securities" in Part B.

Item 8. Redemption or Repurchase.

An investor in MIP may redeem all or any portion of its investment on
any Business Day at the NAV next determined after a redemption request in proper
form is furnished by the investor to MIP. When a request is received in proper
form, MIP will redeem the interests at the next determined NAV.
<PAGE>

The Master Portfolio will make payment for all interests redeemed
within three days after receipt by MIP of a redemption request in proper form,
except as provided by the rules of the Securities and Exchange Commission. MIP
reserves the right to pay redemption proceeds, in whole or in part, by
distributing portfolio securities in lieu of cash if, in the opinion of
management, it is advisable to do so. Interests in the Master Portfolio may not
be transferred.

The right of any investor to receive payment with respect to any
redemption may be suspended or the payment of the redemption proceeds postponed
during any period in which the New York Stock Exchange is closed (other than
weekends or holidays) or trading on such Exchange is restricted, or, to the
extent otherwise permitted by the 1940 Act, if an emergency exists.

Item 9. Pending Legal Proceedings. - Not applicable.
<PAGE>

APPENDIX

PORTFOLIO SECURITIES.

To the extent set forth in this offering document, the Master
Portfolio may invest in the securities described below. The investment
policies, strategies, techniques and restrictions employed by the Master
Portfolio in pursuing its investment objective vis-a-vis the Wilshire 5000 Index
are substantially similar to those employed by the Underlying Portfolios in
pursuing their respective investment objectives vis-a-vis their respective
benchmarks. Unless otherwise indicated, references to the investment policies,
strategies, techniques and restrictions of the Master Portfolio also are
references to the investment policies, strategies, techniques and restrictions
of the Underlying Portfolios in which the Master Portfolio invests substantially
all of its assets.

Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period of
time.

<PAGE>

market rates of interest pursuant to arrangements between the issuer and a
commercial bank acting as agent for the payee of such notes whereby both parties
have the right to vary the amount of the outstanding indebtedness on the notes.
The investment adviser and/or sub-adviser to the Master Portfolio monitors on an
ongoing basis the ability of an issuer of a demand instrument to pay principal
and interest on demand.

<PAGE>

Futures Contracts and Options Transactions -- The Master Portfolio may use
futures as a substitute for a comparable market position in the underlying
securities.

Stock Index Futures and Options on Stock Index Futures -- The Master
-----------------------------------------------------
Portfolio may invest in stock index futures and options on stock index futures
as a substitute for a comparable market position in the underlying securities. A
stock index future obligates the seller to deliver (and the purchaser to take),
effectively, an amount of cash equal to a specific dollar amount times the
difference between the value of a specific stock index at the close of the last
trading day of the contract and the price at which the agreement is made. No
physical delivery of the underlying stocks in the index is made. With respect to
stock indices that are permitted investments, the Master Portfolio intends to
purchase and sell futures contracts on the stock index for which it can obtain
the best price with consideration also given to liquidity. There can be no
assurance that a liquid market will exist at the time when the Master Portfolio
seeks to close out a futures contract or a futures option position. Lack of a
liquid market may prevent liquidation of an unfavorable position.

The use of index swaps is a highly specialized activity which involves
investment techniques and risks different from those associated with ordinary
portfolio security transactions. There is no limit, except as provided below, on
the amount of swap transactions that may be entered into by the Master
Portfolio. These transactions generally do not involve the delivery of
securities or other underlying assets or principal. Accordingly, the risk of
loss with respect to swaps generally is limited to the net amount of payments
that the Master Portfolio is contractually obligated to make. There is also a
risk of a default by the other party to a swap, in which case the Master
Portfolio may not receive net amount of payments that the Master Portfolio
contractually is entitled to receive.

MASTER INVESTMENT PORTFOLIO

U.S. EQUITY INDEX MASTER PORTFOLIO

PART B -- STATEMENT OF ADDITIONAL INFORMATION

FEBRUARY 22, 1999

Item 10. Cover Page.

Item 11. Table Of Contents

General Information and History..................................................................... 1
Investment Objectives and Policies.................................................................. 1
Management of MIP................................................................................... 6
Control Persons and Principal Holders of Securities................................................. 7
Investment Advisory and Other Services.............................................................. 8
Brokerage Allocation and Other Practices............................................................ 9
Capital Stock and Other Securities.................................................................. 9
Purchase, Redemption and Pricing of Securities...................................................... 9
Tax Status.......................................................................................... 11
Underwriters........................................................................................ 11
Calculations of Performance Data.................................................................... 11
Financial Information............................................................................... 11
Appendix............................................................................................ A-1
Financial Statements................................................................................ F-1
</TABLE>

Item 12. General Information and History.

Not applicable.

Item 13. Investment Objectives and Policies.

The following information supplements and should be read in conjunction
with Item 4 in Part A.

Investment Objectives. By this offering document, MIP is offering a
diversified portfolio, U.S. Equity Index Master Portfolio ("Master Portfolio").
Organizations and other entities that hold shares of beneficial interest of the
Master Portfolio may be referred to herein as "feeder funds."

1
<PAGE>

Portfolio Securities.

2
<PAGE>

Management Policies.

3
<PAGE>

2. Hold more than 10% of the outstanding voting securities of any single
issuer. This Investment Restriction applies only with respect to 75% of its
total assets.

4
<PAGE>

11. The Master Portfolio may invest in shares of other open-end
management investment companies, subject to the limitations of Section 12(d)(1)
of the 1940 Act.

5
<PAGE>

Item 14. Management of MIP.

Principal Occupations
Name, Address and Age Position During Past 5 Years
--------------------- ---------- ----------------------
<S> <C> <C>
Jack S. Euphrat, 76 Trustee Private Investor.
415 Walsh Road
Atherton, CA 94027

Thomas S. Goho, 56 Trustee Associate Professor of Finance,
321 Beechcliff Court Calloway School of Business and
Winston-Salem, NC 27104 Accounting, Wake Forest
University, since 1982.

*W. Rodney Hughes, 72 Trustee Private Investor.
31 Dellwood Court
San Rafael, CA 94901

*J. Tucker Morse, 54 Trustee Chairman of Home Account
4 Beaufain Street Networks, Inc.; Real Estate
Charleston, SC 29401 Developer; Chairman of
Renaissance Properties Ltd;
President of Morse Investment
Corporation; and Co-Managing
Partner of Main Street Ventures.

Richard H. Blank, Jr., 42 Chief Operating Officer, Vice President of Stephens;
Secretary and Treasurer Director of Stephens Sports
Management Inc.; and Director of
Capo Inc.
</TABLE>

6
<PAGE>

Compensation Table
For the Fiscal Year Ended February 28, 1998

<TABLE>
<CAPTION>
Total Compensation
Aggregate Compensation from Registrant
Name and Position from Registrant and Fund Complex
------------------ --------------- ----------------
<S> <C> <C>
Jack S. Euphrat $0 $11,250
Trustee

*R. Greg Feltus 0 0
Trustee

Thomas S. Goho 0 11,250
Trustee

*Zoe Ann Hines/1/ 0 0
Trustee

*W. Rodney Hughes 0 11,000
Trustee

Robert M. Joses/2/ 0 1,000
Trustee

*J. Tucker Morse 0 11,000
Trustee
</TABLE>
__________________________
/1/ Zoe Ann Hines retired as of January 28, 1998.
/2/ Robert M. Joses retired as of December 31, 1997.

Trustees of MIP are compensated annually by all the registrants in the fund
complex for their services as indicated above and also are reimbursed for all
out-of-pocket expenses relating to attendance at board meetings. MIP and
MasterWorks Funds Inc. are considered to be members of the same fund complex as
such term is defined in Form N-1A under the 1940 Act (the "BGFA Fund Complex").
Each of the Trustees and the principal officer of MIP serves in the identical
capacity as directors/trustees and/or officer of each registered open-end
management investment company in both the BGFA and Wells Fargo Fund Complexes.
The Trustees are compensated by other Companies and Trusts within the fund
complexes for their services as Directors/Trustees to such Companies and Trusts.
Currently the Trustees do not receive any retirement benefits or deferred
compensation from MIP or any other member of each fund complex.

As of the date of this SAI, the Trustees and Principal Officer of MIP as a
group beneficially owned less than 1% of the outstanding shares of MIP.

Item 15. Control Persons and Principal Holders of Securities.

7
<PAGE>

Item 16. Investment Advisory and other Services.

The following information supplements and should be read in conjunction
with Item 5 in Part A.

Advisory Fees. BGFA is entitled to receive monthly fees at the annual rate
of 0.01% of the average daily net assets of the Master Portfolio, 0.08% of the
average daily net assets of the Extended Index Portfolio and 0.05% of the
average daily net assets of the S&P 500 Index Portfolio (the "Underlying
Portfolios") as compensation for its advisory services. The Master Portfolio
bears its pro rata share of the advisory fees of the Underlying Portfolios.
Based on these fee levels and the expected allocation of assets between the two
Underlying Portfolios, the advisory fees payable to BGFA by the Master Portfolio
on a combined basis will be approximately 0.07% of the average daily net assets
of the Master Portfolio. From time to time, BGFA may waive such fees in whole
or in part. Any such waiver will reduce the expenses of the Master Portfolio
and, accordingly, have a favorable impact on its performance.

Co-Administrators. Stephens and Barclays Global Investors, N.A. (BGI") are
the Master Portfolio's co-administrators. Stephens and BGI provide the Master
Portfolio with administrative services, including general supervision of the
Master Portfolio's non-investment operations, coordination of the other services
provided to the Master Portfolio, compilation of information for reports to the
SEC and the state securities commissions, preparation of proxy statements and
shareholder reports, and general supervision of data compilation in connection
with preparing periodic reports to the MIP's trustees and officers. Stephens
also furnishes office space and certain facilities to conduct the Master
Portfolio's business, and compensates the MIP's trustees, officers and employees
who are affiliated with Stephens. In addition, except as outlined below under
"Expenses," Stephens and BGI will be responsible for paying all expenses
incurred by the Master Portfolio other than the fees payable to BGFA and other
than custodial fees of up to 0.01% payable after the first two years of the
Master Portfolio's operations. Stephens and BGI are entitled to receive a
monthly fee, in the aggregate, at an annual rate of 0.01% of the average daily
net assets of the Master Portfolio for providing administrative services and
assuming expenses.

8
<PAGE>

Expenses. Except for extraordinary expenses, brokerage and other expenses
connected with to the execution of portfolio transactions and certain other
expenses which are borne by the Master Portfolio, Stephens and BGI have agreed
to bear all costs of the Master Portfolio's and MIP's operations. Expenses
attributable only to the Master Portfolio shall be charged only against the
assets of the Master Portfolio. General expenses of MIP shall be allocated among
its portfolios in a manner proportionate to the net assets of each, on a
transactional basis or on such other basis as the Board of Trustees deems
equitable.

Item 17. Brokerage Allocation and Other Practices.

Item 18. Capital Stock and Other Securities.

Item 19. Purchase, Redemption and Pricing Of Securities.

The following information supplements and should be read in conjunction
with Items 7 and 8 in Part A.

9
<PAGE>

Pricing of Securities.

10
<PAGE>

Item 20. Tax Status.

MIP's taxable year-end is the last day of December. Although MIP will not
be subject to federal income tax, it will file appropriate federal income tax
returns.

Item 21. Underwriters.

Item 22. Calculations Of Performance Data.

Not applicable.

Item 23. Financial Information.

11
<PAGE>

APPENDIX

S&P

Bond Ratings

"AAA"

Bonds rated AAA have the highest rating assigned by S&P. Capacity to pay
interest and repay principal is extremely strong.

"AA"

Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.

"A"

"BBB"

Commercial Paper Rating

Moody's

Bond Ratings

"Aaa"

12
<PAGE>

"Aa"

"A"

"Baa"

Commercial Paper Rating

Fitch

Bond Ratings

"AAA"

13
<PAGE>

"AA"

Bonds rated "AA" are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal is
very strong, although not quite as strong as bonds rated "AAA". Because bonds
rated in the "AAA" and "AA" categories are not significantly vulnerable to
foreseeable future developments, short- term debt of these issuers is generally
rated "F-1+".

"A"

"BBB"

Plus (+) and minus (-) signs are used with a rating symbol to indicate the
relative position of a credit within the rating category.

Short-Term Ratings

"F-1+"

Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.

"F-1"

Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F-1+.

"F-2"

Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.

14
<PAGE>

Duff

Bond Ratings

"AAA"

Bonds rated AAA are considered highest credit quality. The risk factors
are negligible, being only slightly more than for risk-free U.S. Treasury debt.

"AA"

Bonds rated AA are considered high credit quality. Protection factors are
strong. Risk is modest but may vary slightly from time to time because of
economic conditions.

"A"

Bonds rated A have protection factors which are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress.

"BBB"

Bonds rated BBB are considered to have below average protection factors but
still considered sufficient for prudent investment. Considerable variability in
risk during economic cycles.

Plus (+) and minus (-) signs are used with a rating symbol (except AAA) to
indicate the relative position of a credit within the rating category.

Commercial Paper Rating

IBCA

Bond and Long-Term Ratings

Commercial Paper and Short-Term Ratings

15
<PAGE>

International and U.S. Bank Ratings

16
<PAGE>

MASTER INVESTMENT PORTFOLIO

File No. 811-8162

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits
- ------- ---------------------------------

(a) Financial Statements

(b) Exhibits:

<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
1(a) - Amended and Restated Declaration of Trust, incorporated by reference to the Registration
Statement on Form N-1A, filed November 15, 1993, and August 31, 1998.

1(b) - Certificate of Trust, incorporated by reference to the Registration Statement on Form N-1A,
filed November 15, 1993, and August 31, 1998.

1(c) - Amendment to the Amended and Restated Agreement and Declaration of Trust, incorporated by
reference to the Registration Statement on Form N-1A, filed August 31, 1998.

1(d) - Certificate of Amendment to the Certificate of Trust, incorporated by reference to the
Registration Statement on Form N-1A, filed September 9, 1998.

2 - By-Laws, incorporated by reference to the Registration Statement on Form N-1A filed November
15, 1993.

3 - Not Applicable.

4 - Not Applicable.

5(a) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2000 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement, filed
January 5, 1996.

5(b) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2010 Master Portfolio,
incorporated by reference to Amendment No. 3 to the Registration Statement, filed January 5,
1996.

5(c) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the
</TABLE>

C-1
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
LifePath 2020 Master Portfolio, incorporated by reference to Amendment No. 3 to the
Registration Statement, filed January 5, 1996.

5(d) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2030 Master Portfolio,
incorporated by reference to Amendment No. 3 to the Registration Statement, filed January 5,
1996.

5(e) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2040 Master Portfolio,
incorporated by reference to Amendment No. 3 to the Registration Statement, filed January 5,
1996.

5(f) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the Bond Index Master Portfolio,
incorporated by reference to Amendment No. 3 to the Registration Statement, filed January 5,
1996.

5(g) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the Asset Allocation Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement, filed
January 5, 1996.

5(h) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the S&P 500 Index Master Portfolio,
incorporated by reference to Amendment No. 3 to the Registration Statement, filed January 5,
1996.

5(i) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the U.S. Treasury Allocation Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement, filed
January 5, 1996.

5(j) - Investment Advisory Contract by and among Barclays Global Fund Advisors and Master Investment
Portfolio dated June 11, 1998, on behalf of the Money Market Master Portfolio, filed herewith.

5(k) - Investment Advisory Contract by and among Barclays Global Fund Advisors and Master Investment
Portfolio dated October 28, 1998, on behalf of the Extended Index Master Portfolio, filed
herewith.

5(l) - Investment Advisory Contract by and among Barclays Global Fund Advisors and master Investment
Portfolio dated October 28, 1998, on behalf of the U.S. Equity Index Master Portfolio, filed
herewith.

6 - Placement Agency Agreement with Stephens Inc. on behalf of each Master Portfolio, incorporated

by reference to Amendment No. 4 to the Registration Statement, filed on June 28, 1996, and
filed herewith.

7 - Not Applicable.

8 - Custody Agreement with Investors Bank & Trust, N.A. dated October 21, 1996 on behalf of each
Master Portfolio, incorporated by reference to Amendment No. 5 to the Registration Statement,
filed June 30, 1997, and filed herewith.
</TABLE>

C-2
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
9(a) - Co-Administration Agreement with Stephens Inc. and Barclays Global Investors, N.A. dated
October 21, 1996 on behalf of each Master Portfolio, incorporated by reference to Amendment
No. 5 to the Registration Statement, filed June 30, 1997, and filed herewith.

9(b) - Sub-Administration Agreement with Investors Bank & Trust and Barclays Global Investors, N.A.
dated October 21, 1996 on behalf of each Master Portfolio, incorporated by reference to
Amendment No. 5 to the Registration Statement, filed June 30, 1997, and filed herewith.

9(c) - Third Party Feeder Fund Agreement with Massmutual Institutional Funds and Massachusetts Mutual

Life Insurance Company dated February 27, 1998, incorporated by reference to Amendment No. 6
to the Registration Statement, filed June 30, 1998.

10 - Not Applicable.

11 - Not Applicable.

12 - Not Applicable.

13 - Not Applicable.

14 - Not Applicable.

15 - Distribution Plan on behalf of the LifePath Master Portfolios, incorporated by reference to
Amendment No. 3 to the Registration Statement, filed January 5, 1996.

16 - Not Applicable.

17 - See Exhibit 27

18 - Not Applicable

19 - Powers of Attorney for Jack S. Euphrat, R. Greg Feltus, Thomas S. Goho, Zoe Ann Hines, W.
Rodney Hughes, Robert M. Joses and J. Tucker Morse, incorporated by reference to Amendment No.

5 to the Registration Statement, filed June 30, 1997.

27 - Financial Data Schedules for the fiscal period ended February 28, 1998, incorporated by
reference to the Form N-SAR, filed on April 28, 1998.
</TABLE>

C-3
<PAGE>

Item 25. Persons Controlled by or Under Common Control with Registrant
- ------- -------------------------------------------------------------

No person is controlled by or under common control with the
Registrant.

Item 26. Number of Holders of Securities
- ------- -------------------------------

As of June 1, 1998, the number of record holders of each class of
securities of the Registrant was as follows:
<TABLE>
<CAPTION>
Number of Record
Title of Class Holders
-------------- ----------------
<S> <C>
Shares of beneficial interest, $.001 per share, of the following series:

LifePath 2000 Master Portfolio 3
LifePath 2010 Master Portfolio 3
LifePath 2020 Master Portfolio 3
LifePath 2030 Master Portfolio 3
LifePath 2040 Master Portfolio 3
S&P 500 Index Master Portfolio 5
Bond Index Master Portfolio 2
Asset Allocation Master Portfolio 2
U.S. Treasury Allocation Master Portfolio 2

</TABLE>

Item 27. Indemnification
- ------- ---------------

Reference is made to Article IX of the Registrant's Declaration of
Trust. The application of these provisions is limited by Article 10 of the
Registrant's By-Laws and by the following undertaking set forth in the rules
promulgated by the Securities and Exchange Commission:

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, 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 such 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 trustee, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, 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 such Act and will
be governed by the final adjudication of such issue.

C-4
<PAGE>

Item 28. (a) Business and Other Connections of Investment Adviser
- ------- ----------------------------------------------------

The LifePath 2000, LifePath 2010, LifePath 2020, LifePath 2030,
LifePath 2040, Asset Allocation, Bond Index, S&P 500 Index and U.S. Treasury
Allocation Master Portfolios are advised by Barclays Global Fund Advisors
("BGFA"), a wholly-owned subsidiary of Barclays Global Investors, N.A. ("BGI",
formerly, Wells Fargo Institutional Trust Company).

BGFA's business is that of a registered investment adviser to certain
open-end, management investment companies and various other institutional
investors. Wells Fargo Bank's business is that of a national banking
association with respect to which it conducts a variety of commercial banking
and trust activities, including acting as investment adviser and/or sub-adviser
to certain open-end management investment companies and various other
institutional investors.

The directors and officers of BGFA consist primarily of persons who
during the past two years have been active in the investment management business
of the former sub-adviser to the Registrant, Wells Fargo Nikko Investment
Advisors ("WFNIA") and, in some cases, the service business of BGI. Each of the
directors and executive officers of BGFA will also have substantial
responsibilities as directors and/or officers of BGI. To the knowledge of the
Registrant, except as set forth below, none of the directors or executive
officers of BGFA is or has been at any time during the past two fiscal years
engaged in any other business, profession, vocation or employment of a
substantial nature.

<TABLE>
<CAPTION>
Name and Position Principal Business(es) During at
at BGFA Least the Last Two Fiscal Years
- ----------------- ---------------------------------
<S> <C>
Frederick L.A. Grauer Director of BGFA and Co-Chairman and Director of BGI
Director 45 Fremont Street, San Francisco, CA 94105

Patricia Dunn Director of BGFA and Co-Chairman and Director of BGI
Director 45 Fremont Street, San Francisco, CA 94105

Lawrence G. Tint Chairman of the Board of Directors of BGFA and

Chairman and Director Chief Executive Officer of BGI
45 Fremont Street, San Francisco, CA 94105

Geoffrey Fletcher Chief Financial Officer of BGFA and BGI since May 1997
45 Fremont Street, San Francisco, CA 94105

Managing Director and Principal Accounting Officer at
Bankers Trust Company from 1988 - 1997
505 Market Street, San Francisco, CA 94111
</TABLE>

Prior to January 1, 1996, Wells Fargo Bank, N.A. ("Wells Fargo Bank"), a
wholly owned subsidiary of Wells Fargo & Company, served as investment adviser
to all of the Registrant's investment portfolios, and to certain other
registered open-end management

C-5
<PAGE>

investment companies. Wells Fargo Bank's business is that of a national banking
association with respect to which it conducts a variety of commercial banking
and trust activities.

To the knowledge of Registrant, none of the directors or executive
officers of Wells Fargo Bank, except those set forth below, is or has been at
any time during the past two fiscal years engaged in any other business,
profession, vocation or employment of a substantial nature, except that certain
executive officers also hold various positions with and engage in business for
Wells Fargo & Company. Set forth below are the names and principal businesses
of the directors and executive officers of Wells Fargo Bank who are or during
the past two fiscal years have been engaged in any other business, profession,
vocation or employment of a substantial nature for their own account or in the
capacity of director, officer, employee, partner or trustee. All the directors
of Wells Fargo Bank also serve as directors of Wells Fargo & Company.

<TABLE>
<CAPTION>
Name and Position Principal Business(es) and Address(es)
at Wells Fargo Bank During at Least the Last Two Fiscal Years
- ------------------- -----------------------------------------
<S> <C>
H. Jesse Arnelle Senior Partner of Arnelle, Hastie, McGee, Willis & Greene
Director 455 Market Street
San Francisco, CA 94105

Director of Armstrong World Industries, Inc.
5037 Patata Street
South Gate, CA 90280

Director of Eastman Chemical Corporation
12805 Busch Place
Santa Fe Springs, CA 90670

Director of FPL Group, Inc.
700 Universe Blvd.
P.O. Box 14000
North Palm Beach, FL 33408

Michael R. Bowlin Chairman of the Board of Directors, Chief Executive Officer,
Director Chief Operating Officer and President of
Atlantic Richfield Co. (ARCO)
Highway 150
Santa Paula, CA 93060

Edward Carson Chairman of the Board and Chief Executive Officer of
Director First Interstate Bancorp
633 West Fifth Street
Los Angeles, CA 90071

Director of Aztar Corporation
2390 East Camelback Road Suite 400
Phoenix, AZ 85016

Director of Castle & Cook, Inc.
10900 Wilshire Blvd.
Los Angeles, CA 90024
</TABLE>

C-6
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
Director of Terra Industries, Inc.
1321 Mount Pisgah Road
Walnut Creek, CA 94596

William S. Davilla President (Emeritus) and a Director of
Director The Vons Companies, Inc.
618 Michillinda Ave.
Arcadia, CA 91007

Director of Pacific Gas & Electric Company
788 Taylorville Road
Grass Valley, CA 95949

Rayburn S. Dezember Director of CalMat Co.
Director 3200 San Fernando Road
Los Angeles, CA 90065

Director of Tejon Ranch Company
P.O. Box 1000
Lebec, CA 93243

Director of The Bakersfield Californian
1707 I Street
P.O. Box 440
Bakersfield, CA 93302

Trustee of Whittier College
13406 East Philadelphia Ave.
P.O. Box 634
Whittier, CA 90608

Paul Hazen Chairman of the Board of Directors of
Chairman of the Board of Wells Fargo & Company
Directors 420 Montgomery Street
San Francisco, CA 94105

Director of Phelps Dodge Corporation
2600 North Central Ave.
Phoenix, AZ 85004

Director of Safeway, Inc.
4th and Jackson Streets
Oakland, CA 94660

Robert K. Jaedicke Professor (Emeritus) of Accounting
Director Graduate School of Business at Stanford University
MBA Admissions Office
Stanford, CA 94305

Director of Bailard Biehl & Kaiser
Real Estate Investment Trust, Inc.
2755 Campus Dr.
</TABLE>

C-7
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
San Mateo, CA 94403

Director of Boise Cascade Corporation
1111 West Jefferson Street
P.O. Box 50
Boise, ID 83728

Director of California Water Service Company
1720 North First Street
San Jose, CA 95112

Director of Enron Corporation
1400 Smith Street
Houston, TX 77002

Director of GenCorp, Inc.
175 Ghent Road
Fairlawn, OH 44333

Director of Homestake Mining Company
650 California Street
San Francisco, CA 94108

Thomas L. Lee Chairman and Chief Executive Officer of
Director The Newhall Land and Farming Company
10302 Avenue 7 1-2
Firebaugh, CA 93622

Director of Calmat Co.
501 El Charro Road
Pleasanton, CA 94588

Director of First Interstate Bancorp
633 West Fifth Street
Los Angeles, CA 90071

Ellen Newman President of Ellen Newman Associates
Director 323 Geary Street
Suite 507
San Francisco, CA 94102

Chair (Emeritus) of the Board of Trustees
University of California at San Francisco Foundation
250 Executive Park Blvd.
Suite 2000
San Francisco, CA 94143

Director of the California Chamber of Commerce
1201 K Street 12th Floor
Sacremento, CA 95814

Philip J. Quigley Chairman, President and Chief Executive Officer of
Director Pacific Telesis Group
130 Kearney Street Rm. 3700
</TABLE>

C-8
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
San Francisco, CA 94108

Carl E. Reichardt Director of Columbia/HCA Healthcare Corporation
Director One Park Plaza
Nashville, TN 37203

Director of Ford Motor Company
The American Road
Dearborn, MI 48121

Director of Newhall Management Corporation
23823 Valencia Blvd.
Valencia, CA 91355

Director of Pacific Gas and Electric Company
77 Beale Street
San Francisco, CA 94105

Retired Chairman of the Board of Directors
and Chief Executive Officer of Wells Fargo & Company
420 Montgomery Street
San Francisco, CA 94105

Donald B. Rice President and Chief Executive Officer of Teledyne, Inc.
Director 2049 Century Park East
Los Angeles, CA 90067

Retired Secretary of the Air Force
Director of Vulcan Materials Company
One MetroPlex Drive
Birmingham, AL 35209

Richard J. Stegemeier Chairman (Emeritus) of Unocal Corp
Director 44141 Yucca Avenue
Lancaster, CA 93534

Director of Foundation Health Corporation
166 4th
Fort Irwin, CA 92310

Director of Halliburton Company
3600 Lincoln Plaza
500 North Alcard Street
Dallas, TX 75201

Director of Northrop Grumman Corp.
1840 Century Park East
Los Angeles, CA 90067

Director of Outboard Marine Corporation
100 SeaHorse Drive
Waukegan, IL 60085
</TABLE>

C-9
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
Director of Pacific Enterprises
555 West Fifth Street
Suite 2900
Los Angeles, CA 90031

Director of First Interstate Bancorp
633 West Fifth Street
Los Angeles, CA 90071

Susan G. Swenson President and Chief Executive Officer of Cellular One
Director 651 Gateway Blvd.
San Francisco, CA 94080

David M. Tellep Retired Chairman of the Board and Chief Executive Officer of
Director Martin Lockheed Corp
6801 Rockledge Drive
Bethesda, MD 20817

Director of Edison International
and Southern California Edison Company
2244 Walnut Grove Ave.
Rosemead, CA 91770

Director of First Interstate
633 West Fifth Street
Los Angeles, CA 90071

Chang-Lin Tien Chancellor of the University of California at Berkeley
Director Berkeley, CA 94720

Director of Raychem Corporation
300 Constitution Drive
Menlo Park, CA 94025

John A. Young President, Chief Executive Officer and Director
Director of Hewlett-Packard Company
3000 Hanover Street
Palo Alto, CA 9434

Director of Chevron Corporation
225 Bush Street
San Francisco, CA 94104

Director of Lucent Technologies
25 John Glenn Drive
Amherst, NY 14228

Director of Novell, Inc.
11300 West Olympic Blvd.
Los Angeles, CA 90064

Director of Shaman Pharmaceuticals Inc.
213 East Grand Ave. South
</TABLE>

C-10
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
San Francisco, CA 94080

William F. Zuendt President of Wells Fargo & Company
President 420 Montgomery Street
San Francisco, CA 94105

Director of 3Com Corporation
5400 Bayfront Plaza
P.O. Box 58145
Santa Clara, CA 95052

Director of the California Chamber of Commerce
</TABLE>

Prior to January 1, 1996, WFNIA served as the sub-adviser to the Asset
Allocation, U.S. Treasury Allocation, Bond Index and S&P 500 Index Master
Portfolios, and as adviser or sub-adviser to various other open-end management
investment companies. For additional information, see "Management" in the Part
B. For information as to the business, profession, vocation or employment of a
substantial nature of each of the officers and management committees of WFNIA,
reference is made to WFNIA's Form ADV and Schedules A and D filed under the
Investment Advisers Act of 1940, SEC File No. 801-36479, incorporated herein by
reference.

Item 29. Principal Underwriters
- ------- ----------------------

(a) Stephens Inc., placement agent for the Registrant, does not
presently act as investment adviser for any other registered investment
companies, but does act as principal underwriter for Life & Annuity Trust,
MasterWorks Funds Inc., Stagecoach Funds, Inc., Stagecoach Trust, Nations Fund,
Inc., Nations Fund Trust, Nations Fund Portfolios, Inc., Nations LifeGoal Funds,
Inc. and Nations Institutional Reserves, and is the exclusive placement agent
for Managed Series Investment Trust and Master Investment Portfolio, all of
which are registered open-end management investment companies.

(b) Information with respect to each director and officer of the
principal underwriter is incorporated by reference to Form ADV and Schedules A
and D filed by Stephens Inc. with the Securities and Exchange Commission
pursuant to the Investment Advisors Act of 1940 (File No. 501-15510).

Item 30. Location of Accounts and Records
- ------- --------------------------------

(a) The Registrant maintains accounts, books and other documents required
by Section 31(a) of the Investment Company Act of 1940 and the rules thereunder
(collectively, "Records") at the offices of Stephens Inc., 111 Center Street,
Little Rock, Arkansas 72201.

C-11
<PAGE>

(b) BGFA and BGI maintain all Records relating to their services as
adviser and co-administrator, respectively, at 45 Fremont Street, San Francisco,
California 94105.

(c) Wells Fargo Bank maintains all Records relating to its services as
investment adviser for the periods prior to January 1, 1996, at 525 Market
Street, San Francisco, California 94105.

(d) Stephens maintains all Records relating to its services as sponsor,
co- administrator and distributor at 111 Center Street, Little Rock, Arkansas
72201.

(e) IBT maintains all Records relating to its services as sub-
administrator and custodian at 89 South Street, Boston, Massachusetts 02111.

Item 31. Management Services
- ------- -------------------

Other than as set forth under the captions "Item 5 Management of the
Master Portfolios" in Part A of this Registration Statement and "Item 16
Investment Advisory and Other Services" in Part B of this Registration
Statement, Registrant is not a party to any management-related service contract.

Item 32. Undertakings
- ------- ------------

(a) Not applicable.

(b) Not applicable.

(c) Registrant hereby undertakes to call a meeting of shareholders for
the purpose of voting upon the questions of removal of a trustee or trustees
when requested in writing to do so by the holders of at least 10% of the
Registrant's outstanding shares of beneficial interest and in connection with
such meeting to comply with the provisions of Section 16(c) of the Investment
Company Act of 1940 relating to shareholder communications.

C-12
<PAGE>

SIGNATURES

Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to its Registration Statement on Form
N-1A to be signed on its behalf by the undersigned, thereto duly authorized, in
the City of Little Rock, State of Arkansas on the 22nd day of February, 1999.

MASTER INVESTMENT PORTFOLIO

By /s/ Richard H. Blank, Jr.
-------------------------
(Richard H. Blank, Jr.)
Secretary and Treasurer
(Principal Financial Officer)

Signature Title
--------- -----

* Trustee, Chairman and President
-------------------------
(R. Greg Feltus) (Principal Executive Officer)

/s/ Richard H. Blank, Jr. Secretary and Treasurer
-------------------------
(Richard H. Blank, Jr.) (Principal Financial Officer)

* Trustee
--------------------------
(Jack S. Euphrat)

* Trustee
--------------------------
(Thomas S. Goho)

* Trustee
--------------------------
(W. Rodney Hughes)

* Trustee
--------------------------
(J. Tucker Morse)

*By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
As Attorney-in-Fact
February 22, 1999
<PAGE>

MASTER INVESTMENT PORTFOLIO

File No. 811-8162

EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
EX-99.B5(j) . Investment Advisory Contract-Money Market Master Portfolio

EX-99.B5(k) . Investment Advisory Contract-Extended Index Master Portfolio

EX-99.B5(l) . Investment Advisory Contract-U.S. Equity Index Master Portfolio

EX-99.B6 . Placement Agency Agreement

EX-99.B8 . Custody Agreement

EX-99.B9(a) . Co-Administration Agreement

EX-99.B9(b) . Sub-Administration Agreement

.
</TABLE>

<PAGE>

EXHIBIT 99.B5(j)

INVESTMENT ADVISORY CONTRACT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

June 11, 1998

Barclays Global Fund Advisors
45 Fremont Street
San Francisco, California 94105

Dear Sirs:

This will confirm the agreement between the undersigned (the "Trust") on
behalf of the Money Market Master Portfolio (the "Master Portfolio") and
Barclays Global Fund Advisors (the "Adviser") as follows:

1. The Trust is a registered open-end management investment company
currently consisting of fourteen investment portfolios, but which may from time
to time consist of a greater or lesser number of investment portfolios (the
"Master Portfolios"). The Money Market Master Portfolio is one of the fifteen
Master Portfolios. The Trust proposes to engage in the business of investing and
reinvesting the assets of the Master Portfolio in the manner and in accordance
with the investment objective and restrictions specified in the Trust's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Trust under the Investment Company Act of 1940 (the
"Act"). Copies of the Registration Statement have been furnished to the Adviser.
Any amendments to the Registration Statement shall be furnished to the Adviser
promptly.

2. The Trust is engaging the Adviser to manage the investing and
reinvesting of the Master Portfolio's assets and to provide the advisory
services specified elsewhere in this contract to the Master Portfolio, subject
to the overall supervision of the Board of Trustees of the Trust.

3. (a) The Adviser shall make investments for the account of the Master
Portfolio in accordance with the Adviser's best judgment and consistent with the
investment objective and restrictions set forth in the Trust's Registration
Statement, the Act and the provisions of the Internal Revenue Code of 1986
relating to regulated investment companies, subject to policy decisions adopted
by the Trust's Board of Trustees. The Adviser shall advise the Trust's officers
and Board of Trustees, at such times as the Trust's Board of Trustees may
specify, of investments made for the Master Portfolio and shall, when requested
by the Trust's officers or Board of Trustees, supply the reasons for making
particular investments.

(b) The Adviser shall provide to the Trust investment guidance and
policy direction in connection with its daily management of the Master
Portfolio's assets, including oral and written research, analysis, advice,
statistical and economic data and information and judgments, and shall furnish
to the Trust's Board of Trustees periodic reports on the investment strategy and
performance of the Master Portfolio and such additional reports and information
as the Trust's Board of Trustees and officers shall reasonably request.

(c) The Adviser shall pay the costs of printing and distributing all
materials relating to the Master Portfolio prepared by it, or prepared at its
request, other than such costs relating to proxy statements, Part As, reports
for holders of beneficial interests of the Master Portfolio ("Interestholders")
and other materials distributed to existing or prospective Interestholders on
behalf of the Master Portfolio.

(d) The Adviser shall, at its expense, employ or associate with itself
such persons as the Adviser believes appropriate to assist it in performing its
obligations under this contract.

4. The Trust understands that the Adviser, in rendering its services to the
Master Portfolio hereunder, may delegate certain advisory responsibilities
hereunder to a sub-adviser (the "Sub-Adviser"), provided that the Adviser shall
continue to supervise and monitor the performance of the duties delegated to the
Sub-Adviser and provided that any such delegation will not relieve the Adviser
of its duties and obligations under this contract. The Adviser will not seek to
amend any such Sub-Advisory Contract to

1
<PAGE>

materially alter the obligations of the parties unless the Adviser gives the
Trust at least 60 days' prior written notice thereof.

5. The Adviser shall give the Trust and the Master Portfolio the benefit of
the Adviser's best judgment and efforts in rendering services under this
contract. As an inducement to the Adviser's undertaking to render these
services, the Trust agrees that the Adviser shall not be liable under this
contract for any mistake in judgment or in any other event whatsoever except for
lack of good faith, provided that nothing in this contract shall be deemed to
protect or purport to protect the Adviser against any liability to the Trust or
its Interestholders to which the Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of the
Adviser's duties under this contract or by reason of reckless disregard of its
obligations and duties hereunder.

6. In consideration of the services to be rendered by the Adviser under
this contract, the Trust shall pay the Adviser a monthly fee on the first
business day of each month, at the annual rate of 0.10% of the average daily
value (as determined on each day that such value is determined for the Master
Portfolio at the time set forth in the Registration Statement for determining
net asset value per share) of the Master Portfolio's net assets during the
preceding month. If the fee payable to the Adviser pursuant to this paragraph 6
begins to accrue after the beginning of any month or if this contract terminates
before the end of any month, the fee for the period from the effective date to
the end of that month or from the beginning of that month to the termination
date, respectively, shall be prorated according to the proportion that the
period bears to the full month in which the effectiveness or termination occurs.
For purposes of calculating each such monthly fee, the value of the Master
Portfolio's net assets shall be computed in the manner specified in the
Registration Statement and the Trust's Agreement and Declaration of Trust for
the computation of the value of the Master Portfolio's net assets in connection
with the determination of the net asset value of Master Portfolio interests.

7. If in any fiscal year the aggregate expenses of the Master Portfolio
(including fees pursuant to this contract, but excluding interest, taxes,
brokerage and, with the prior written consent of the necessary state securities
commissions, extraordinary expenses) exceed the expense limitation of any state
having jurisdiction over the Master Portfolio, the Trust may deduct from the
fees to be paid hereunder, or the Adviser will bear, such excess expense to the
extent required by state law. The Adviser's obligation pursuant hereto will be
limited to the amount of the Adviser's fees hereunder. For purposes of
computing the excess, if any, over the most restrictive applicable expense
limitation, the value of the Master Portfolio's net assets shall be computed in
the manner specified in the last sentence of paragraph 6, and any reimbursements
required to be made by the Adviser shall be made once a year promptly after the
end of the Master Portfolio's fiscal year.

8. This contract shall become effective on its execution date and shall
thereafter continue in effect for a period of more than two years from the date
hereof only so long as the continuance is specifically approved at least
annually (a) by the vote a majority of the Master Portfolio's outstanding voting
securities (as defined in the Act) or by the Trust's Board of Trustees and (b)
by the vote, cast in person at a meeting called for the purpose, of a majority
of the Trust's trustees who are not parties to this contract or "interested
persons" (as defined in the Act) of any such party. This contract may be
terminated at any time by the Trust without the payment of any penalty, by a
vote of a majority of the Master Portfolio's outstanding voting securities (as
defined in the Act) or by a vote of a majority of the Trust's entire Board of
Trustee's on 60 days' written notice to the Adviser or by the Adviser on 60
days' written notice to the Trust. This contract shall terminate automatically
in the event of its assignment (as defined in the Act).

9. Except to the extent necessary to perform the Adviser's obligations
under this contract, nothing herein shall be deemed to limit or restrict the
right of the Adviser, or any affiliate of the Adviser, or any employee of the
Adviser, to engage in any other business or to devote time and attention to the
management or other aspects of any other business, whether of a similar or
dissimilar nature, or to render services of any kind to any other corporation,
firm, individual or association.

10. This contract shall be governed by and construed in accordance with the
laws of the State of California.

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<PAGE>

11. This contract has been executed on behalf of the Trust by the
undersigned officer of the Trust in his capacity as an officer of the Trust. The
obligations of this contract shall only be binding upon the assets and property
of the Master Portfolio, as provided for in the Trust's Agreement and
Declaration of Trust, and shall not be binding upon any Trustee, officer or
Interestholder of the Trust or Master Portfolio individually.

If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.

Very truly yours,

MASTER INVESTMENT PORTFOLIO
on behalf of the Money Market
Master Portfolio

By: /s/ Richard H. Blank, Jr.
-------------------------

Name: Richard H. Blank, Jr.

Title: CEO

ACCEPTED as of the date
set forth above:

BARCLAYS GLOBAL FUND ADVISORS

By: /s/ Lawrence G.Tint
-------------------

Name: Lawrence G. Tint

Title: Head of Global Client Relationships

By: /s/ Julia LeSage
----------------

Name: Julia LeSage

Title: Principal, Manager of Mutual Fund Administration

<PAGE>

EXHIBIT 99.B5(k)

INVESTMENT ADVISORY CONTRACT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

October 28, 1998

Barclays Global Fund Advisors
45 Fremont Street
San Francisco, California 94105

Dear Sirs:

This will confirm the agreement between the undersigned (the "Trust") on
behalf of the U.S. Equity Index Master Portfolio (the "Master Portfolio") and
Barclays Global Fund Advisors (the "Adviser") as follows:

1. The Trust is a registered open-end management investment company
currently consisting of ten investment portfolios, but which may from time to
time consist of a greater or lesser number of investment portfolios (the "Master
Portfolios"). The U.S. Equity Master Portfolio is one of the twelve Master
Portfolios. The Trust proposes to engage in the business of investing and
reinvesting the assets of the Master Portfolio in the manner and in accordance
with the investment objective and restrictions specified in the Trust's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Trust under the Investment Company Act of 1940 (the
"Act"). Copies of the Registration Statement have been furnished to the Adviser.
Any amendments to the Registration Statement shall be furnished to the Adviser
promptly.

(d) The Adviser shall, at its expense, employ or associate with itself
such persons as the Adviser believes appropriate to assist it in performing its
obligations under this contract.

4. The Trust understands that the Adviser, in rendering its services to
the Master Portfolio hereunder, may delegate certain advisory responsibilities
hereunder to a sub-adviser (the "Sub-Adviser"), provided that the Adviser shall
continue to supervise and monitor the performance of the duties delegated to the
Sub-Adviser and provided that any such delegation will not relieve the Adviser
of its duties and obligations under this contract. The Adviser will not seek to
amend any such Sub-Advisory Contract to

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<PAGE>

materially alter the obligations of the parties unless the Adviser gives the
Trust at least 60 days' prior written notice thereof .

5. The Adviser shall give the Trust and the Master Portfolio the benefit
of the Adviser's best judgment and efforts in rendering services under this
contract. As an inducement to the Adviser's undertaking to render these
services, the Trust agrees that the Adviser shall not be liable under this
contract for any mistake in judgment or in any other event whatsoever except for
lack of good faith, provided that nothing in this contract shall be deemed to
protect or purport to protect the Adviser against any liability to the Trust or
its Interestholders to which the Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of the
Adviser's duties under this contract or by reason of reckless disregard of its
obligations and duties hereunder.

6. In consideration of the services to be rendered by the Adviser under
this contract, the Trust shall pay the Adviser a monthly fee on the first
business day of each month, at the annual rate of 0.01% of the average daily
value (as determined on each day that such value is determined for the Master
Portfolio at the time set forth in the Registration Statement for determining
net asset value per share) of the Master Portfolio's net assets during the
preceding month. If the fee payable to the Adviser pursuant to this paragraph 6
begins to accrue after the beginning of any month or if this contract terminates
before the end of any month, the fee for the period from the effective date to
the end of that month or from the beginning of that month to the termination
date, respectively, shall be prorated according to the proportion that the
period bears to the full month in which the effectiveness or termination occurs.
For purposes of calculating each such monthly fee, the value of the Master
Portfolio's net assets shall be computed in the manner specified in the
Registration Statement and the Trust's Agreement and Declaration of Trust for
the computation of the value of the Master Portfolio's net assets in connection
with the determination of the net asset value of Master Portfolio interests.

7. If in any fiscal year the aggregate expenses of the Master Portfolio
(including fees pursuant to this contract, but excluding interest, taxes,
brokerage and, with the prior written consent of the necessary state securities
commissions, extraordinary expenses) exceed the expense limitation of any state
having jurisdiction over the Master Portfolio, the Trust may deduct from the
fees to be paid hereunder, or the Adviser will bear, such excess expense to the
extent required by state law. The Adviser's obligation pursuant hereto will be
limited to the amount of the Adviser's fees hereunder. For purposes of computing
the excess, if any, over the most restrictive applicable expense limitation, the
value of the Master Portfolio's net assets shall be computed in the manner
specified in the last sentence of paragraph 6, and any reimbursements required
to be made by the Adviser shall be made once a year promptly after the end of
the Master Portfolio's fiscal year.

10. This contract shall be governed by and construed in accordance with
the laws of the State of California.

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<PAGE>

If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.

Very truly yours,

MASTER INVESTMENT PORTFOLIO
on behalf of the U.S. Equity Index Master
Portfolio

By: /s/ Richard H. Blank, Jr.
-------------------------

Name: Richard H. Blank, Jr.

Title: CEO

ACCEPTED as of the date
set forth above:

BARCLAYS GLOBAL FUND ADVISORS

By: /s/ Lawrence G. Tint
--------------------

Name: Lawrence G. Tint

Title: Head of Global Client Relationships

By: /s/ Julia LeSage
----------------

Name: Julia LeSage

Title: Principal, Manager of Mutual Fund Administration

<PAGE>
EXHIBIT 99.B5(l)

INVESTMENT ADVISORY CONTRACT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

October 28, 1998

Barclays Global Fund Advisors
45 Fremont Street
San Francisco, California 94105

Dear Sirs:

This will confirm the agreement between the undersigned (the "Trust") on
behalf of the Extended Index Master Portfolio (the "Master Portfolio") and
Barclays Global Fund Advisors (the "Adviser") as follows:

1. The Trust is a registered open-end management investment company
currently consisting of ten investment portfolios, but which may from time to
time consist of a greater or lesser number of investment portfolios (the "Master
Portfolios"). The Extended Index Master Portfolio is one of the twelve Master
Portfolios. The Trust proposes to engage in the business of investing and
reinvesting the assets of the Master Portfolio in the manner and in accordance
with the investment objective and restrictions specified in the Trust's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Trust under the Investment Company Act of 1940 (the
"Act"). Copies of the Registration Statement have been furnished to the Adviser.
Any amendments to the Registration Statement shall be furnished to the Adviser
promptly.

(d) The Adviser shall, at its expense, employ or associate with itself
such persons as the Adviser believes appropriate to assist it in performing its
obligations under this contract.

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<PAGE>

materially alter the obligations of the parties unless the Adviser gives the
Trust at least 60 days' prior written notice thereof.

6. In consideration of the services to be rendered by the Adviser under
this contract, the Trust shall pay the Adviser a monthly fee on the first
business day of each month, at the annual rate of 0.08% of the average daily
value (as determined on each day that such value is determined for the Master
Portfolio at the time set forth in the Registration Statement for determining
net asset value per share) of the Master Portfolio's net assets during the
preceding month. If the fee payable to the Adviser pursuant to this paragraph 6
begins to accrue after the beginning of any month or if this contract terminates
before the end of any month, the fee for the period from the effective date to
the end of that month or from the beginning of that month to the termination
date, respectively, shall be prorated according to the proportion that the
period bears to the full month in which the effectiveness or termination occurs.
For purposes of calculating each such monthly fee, the value of the Master
Portfolio's net assets shall be computed in the manner specified in the
Registration Statement and the Trust's Agreement and Declaration of Trust for
the computation of the value of the Master Portfolio's net assets in connection
with the determination of the net asset value of Master Portfolio interests.

10. This contract shall be governed by and construed in accordance with the
laws of the State of California.

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<PAGE>

If the foregoing correctly sets forth the agreement between the Trust and
the Adviser, please so indicate by signing and returning to the Trust the
enclosed copy hereof.

Very truly yours,

MASTER INVESTMENT PORTFOLIO
on behalf of the Extended Index Master
Portfolio

By: /s/ Richard H. Blank, Jr.
-------------------------

Name: Richard H. Blank, Jr.

Title: CEO

ACCEPTED as of the date
set forth above:

BARCLAYS GLOBAL FUND ADVISORS

By: /s/ Lawrence G. Tint
--------------------

Name: Lawrence G. Tint

Title: Head of Global Client Relationships

By: /s/ Julia LeSage
----------------

Name: Julia LeSage

Title: Principal, Manager of Mutual Fund Administration

<PAGE>

EXHIBIT 99.B6

PLACEMENT AGENCY AGREEMENT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

February 25, 1994

Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201

Dear Sirs:

This is to confirm that, in consideration of the agreements hereinafter
contained, the undersigned, Master Investment Portfolio, a Delaware business
trust (the "Master Portfolio") consisting of the portfolios named on Schedule 1
hereto, as such Schedule may be revised from time to time (each, a "Master
Series"), has agreed that you shall be, for the period of this Agreement, the
exclusive placement agent for shares of beneficial interest of each Master
Series.

1. You will act as agent for the private placement of shares of each
Master Series covered by, and in accordance with, the registration statement and
prospectus then in effect under the Investment Company Act of 1940, as amended,
and will transmit promptly any orders received by you for purchase or redemption
of shares of a Master Series to the Transfer and Dividend Disbursing Agent for
the Master Portfolio of which the Master Portfolio has notified you in writing.
All orders from you shall be subject to acceptance and confirmation by the
Master Portfolio.

2. You shall act as exclusive placement agent for each Master Series'
shares in compliance with all applicable laws, rules and regulations, including,
without limitation, all rules and regulations made or adopted pursuant to the
Investment Company Act of 1940, as amended, by the Securities and Exchange
Commission or any securities association registered under the Securities
Exchange Act of 1934, as amended.

3. Whenever in their judgment such action is warranted by market,
economic or political conditions, or by abnormal circumstances of any kind, the
Master Portfolio's officers may decline to accept any orders for, or make any
sales of, any of the Master Series' shares until such time as they deem it
advisable to accept such orders and to make such sales and the Master Portfolio
shall advise you promptly of such determination.

4. Ownership of Master Series shares sold hereunder shall be registered
in such names and denominations as are specified in writing to the Master
Portfolio or to its agent designated for the purpose. No certificates for
shares of the Master Series will be issued.

5. The Master Portfolio agrees to pay all expenses in connection with
maintaining facilities for the issue and transfer of the Master Series' shares
and for supplying information, prices and

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<PAGE>

other data to be furnished by the Master Portfolio hereunder, and all expenses
in connection with preparing and printing the Master Portfolio's prospectuses
and statements of additional information for regulatory purposes and for
distribution to shareholders; provided, however, that nothing contained herein
shall be deemed to require the Master Portfolio to pay any of the costs of
advertising the sale of the Master Series' shares. You shall pay all other
expenses incurred by you in connection with the sale of the Master Series'
shares as contemplated in this agreement.

6. All shares offered for sale and sold by you shall be offered for
sale and sold by you to investors at the price per share (the "offering price,"
which is the net asset value per share) specified and determined as provided in
the prospectus relating to the offering of relevant Master Series' shares for
sale. If the offering price is not an exact multiple of one cent, it shall be
adjusted to the nearest full cent. The Master Portfolio shall determine and
furnish promptly to you a statement of the offering price at least once on each
day on which the prospectus states the Master Portfolio is required to determine
the relevant Master Series' net asset value for the purpose of pricing purchase
orders. Each offering price shall become effective at the time and shall remain
in effect during the period specified in the statement. Each such statement
shall show the basis of its computation. For purposes of establishing the
offering price, the Master Portfolio shall consider a purchase order to have
been presented to it at the time it was originally entered by you for
transmission to it, provided the original purchase order and your fulfilling
order to the Master Portfolio are appropriately time stamped or evidenced to
show the time of original entry and that your fulfilling order to the Master
Portfolio is received by the Master Portfolio within a time deemed by it to be
reasonable after the purchase order was originally entered. Purchases of shares
shall be made for full and fractional shares, carried to the third decimal
place.

7. The Master Portfolio shall furnish you from time to time, for use in
connection with the sale of the Master Series' shares, such information with
respect to the Master Portfolio and the Master Series' shares as you may
reasonably request, all of which shall be signed by one or more of the Master
Portfolio's duly authorized officers; and the Master Portfolio warrants that the
statements contained in any such information, when so signed by the Master
Portfolio's officers, shall be true and correct. The Master Portfolio also
shall furnish you with copies of its reports to shareholders and such additional
information regarding a Master Series' financial condition as you may reasonably
request from time to time.

8. The Master Portfolio represents to you that all registration
statements and prospectuses filed by the Master Portfolio with the Securities
and Exchange Commission under the Investment Company Act of 1940, as amended,
with respect to the Master Series' shares have been carefully prepared in
conformity with the requirements of said Act and rules and regulations of the
Securities and Exchange Commission thereunder. As used in this agreement the
terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and Exchange
Commission and any amendments and supplements thereto which at any time shall
have been filed with said Commission. The Master Portfolio represents and
warrants to you that any registration statement and prospectus, when such
registration statement becomes effective, will contain all statements required
to be stated therein in conformity with said Act and the rules and regulations
of said Commission; that all statements of fact contained in any such
registration statement and prospectus will be true and correct when such
registration statement becomes effective; and that neither any registration
statement nor any prospectus when such registration statement becomes effective
will include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading. The Master Portfolio may but shall not be obligated to propose
from time to time such amendment or amendments to any registration statement and
such supplement or supplements to any prospectus as, in the light of future
developments, may, in the opinion of the Master Portfolio's counsel,

2
<PAGE>

be necessary or advisable. If the Master Portfolio shall not propose such
amendment or amendments and/or supplement or supplements within fifteen days
after receipt by the Master Portfolio of a written request from you to do so,
you may, at your option, terminate this agreement or decline to make offers of
the Master Series' securities until such amendments are made. The Master
Portfolio shall not file any amendment to any registration statement or
supplement to any prospectus without giving you reasonable notice thereof in
advance; provided, however, that nothing contained in this agreement shall in
any way limit the Master Portfolio's right to file at any time such amendments
to any registration statement and/or supplements to any prospectus, of whatever
character, as the Master Portfolio may deem advisable, such right being in all
respects absolute and unconditional.

9. The Master Portfolio authorizes you to use any prospectus in the form
furnished to you from time to time, in connection with the sale of the Master
Series' shares. The Master Portfolio agrees to indemnify, defend and hold you,
your several officers and directors, and any person who controls you within the
meaning of Section 15 of the Securities Act of 1933, as amended, free and
harmless from and against any and all claims, demands, liabilities and expenses
(including the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection therewith) which you,
your officers and directors, or any such controlling person, may incur under the
Securities Act of 1933, as amended, or under common law or otherwise, arising
out of or based upon any untrue statement, or alleged untrue statement, of a
material fact contained in any registration statement or any prospectus or
arising out of or based upon any omission, or alleged omission, to state a
material fact required to be stated in either any registration statement or any
prospectus or necessary to make the statements in either thereof not misleading;
provided, however, that the Master Portfolio's agreement to indemnify you, your
officers or directors, and any such controlling person shall not be deemed to
cover any claims, demands, liabilities or expenses arising out of any untrue
statement or alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus in reliance upon and in conformity with
written information furnished to the Master Portfolio by you specifically for
use in the preparation thereof. The Master Portfolio's agreement to indemnify
you, your officers and directors, and any such controlling person, as aforesaid,
is expressly conditioned upon the Master Portfolio's being notified of any
action brought against you, your officers or directors, or any such controlling
person, such notification to be given by letter or by telegram addressed to the
Master Portfolio at its office in San Francisco, California within ten days
after the summons or other first legal process shall have been served. The
failure so to notify the Master Portfolio of any such action shall not relieve
the Master Portfolio from any liability which the Master Portfolio may have to
the person against whom such action is brought by reason of any such untrue, or
alleged untrue, statement or omission, or alleged omission, otherwise than on
account of the Master Portfolio's indemnity agreement contained in this
paragraph 9. The Master Portfolio will be entitled to assume the defense of any
suit brought to enforce any such claim, demand or liability, but, in such case,
such defense shall be conducted by counsel of good standing chosen by the Master
Portfolio and approved by you. In the event the Master Portfolio elects to
assume the defense of any such suit and retain counsel of good standing approved
by you, the defendant or defendants in such suit shall bear the fees and
expenses of any additional counsel retained by any of them; but in case the
Master Portfolio does not elect to assume the defense of any such suit, or in
case you do not approve of counsel chosen by the Master Portfolio, the Master
Portfolio will reimburse you, your officers and directors, or the controlling
person or persons named as defendant or defendants in such suit, for the fees
and expenses of any counsel retained by you or them. The Master Portfolio's
indemnification agreement contained in this paragraph 9 and the Master
Portfolio's representations and warranties in this agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of you, your officers and directors, or any controlling person, and
shall survive the delivery of any of the Master Series' shares. This agreement
of indemnity will inure exclusively to your benefit, to the benefit of your
several officers and directors, and their respective

3
<PAGE>

estates, and to the benefit of any controlling persons and their successors. The
Master Portfolio agrees promptly to notify you of the commencement of any
litigation or proceedings against the Master Portfolio or any of its officers or
Trustees in connection with the issue and sale of any of the Master Series'
shares.

10. You agree to indemnify, defend and hold the Master Portfolio, its
several officers and Trustees, and any person who controls the Master Portfolio
within the meaning of Section 15 of the Securities Act of 1933, as amended, free
and harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which the
Master Portfolio, its officers or Trustees, or any such controlling person, may
incur under the Securities Act of 1933, as amended, or under common law or
otherwise, but only to the extent that such liability or expense incurred by the
Master Portfolio, its officers or Trustees, or such controlling person resulting
from such claims or demands, shall arise out of or be based upon (a) any untrue,
or alleged untrue, statement of a material fact contained in information
furnished in writing by you to the Master Portfolio specifically for use in the
Master Portfolio's registration statement and used in the answers to any of the
items of the registration statement or in the corresponding statements made in
the prospectus, or shall arise out of or be based upon any omission, or alleged
omission, to state a material fact in connection with such information furnished
in writing by you to the Master Portfolio and required to be stated in such
answers or necessary to make such information not misleading or (b) any act or
omission or alleged act or omission on your part as the Master Portfolio's agent
that has not been expressly authorized by the Master Portfolio in writing. Your
agreement to indemnify the Master Portfolio, its officers and Trustees, and any
such controlling person, as aforesaid, is expressly conditioned upon your being
notified of any action brought against the Master Portfolio, its officers or
Trustees, or any such controlling person, such notification to be given by
letter or telegram addressed to you at your principal office in Little Rock,
Arkansas within ten days after the summons or other first legal process shall
have been served. You shall have the right to control the defense of such
action, with counsel of your own choosing, satisfactory to the Master Portfolio,
if such action is based solely upon such alleged misstatement or omission on
your part, and in any other event the Master Portfolio, its officers or Trustees
or such controlling person shall each have the right to participate in the
defense or preparation of the defense of any such action. The failure so to
notify you of any such action shall not relieve you from any liability which you
may have to the Master Portfolio, its officers or Trustees, or to such
controlling person by reason of any such untrue, or alleged untrue, statement or
omission, or alleged omission, otherwise than on account of your indemnity
agreement contained in this paragraph 10.

11. None of the Master Series' shares shall be offered by either you or
the Master Portfolio under any of the provisions of this agreement and no orders
for the purchase or sale of such shares hereunder shall be accepted by the
Master Portfolio if and so long as the effectiveness of the registration
statement then in effect or any necessary amendments thereto shall be suspended
under any of the provisions of the Investment Company Act of 1940, as amended;
provided, however, that nothing contained in this paragraph 11 shall in any way
restrict or have an application to or bearing upon the Master Portfolio's
obligation to repurchase any of the Master Series' shares from any shareholder
in accordance with the provisions of the Master Portfolio's prospectus or
Declaration of Trust.

12. The Master Portfolio agrees to advise you immediately in writing:

(a) of any request by the Securities and Exchange Commission for
amendments to the registration statement or prospectus then in effect or for
additional information;

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<PAGE>

(b) in the event of the issuance by the Securities and Exchange
Commission of any stop order suspending the effectiveness of the registration
statement or prospectus then in effect or the initiation of any proceeding for
that purpose;

(c) of the happening of any event which makes untrue any statement of a
material fact made in the registration statement or prospectus then in effect
or which requires the making of a change in such registration statement or
prospectus in order to make the statements therein not misleading; and

(d) of all actions of the Securities and Exchange Commission with respect
to any amendments to any registration statement or prospectus which may from
time to time be filed with the Securities and Exchange Commission.

13. Insofar as they concern the Master Portfolio, the Master Portfolio
shall comply with all applicable laws, rules and regulations, including, without
limiting the generality of the foregoing, all rules or regulations made or
adopted pursuant to the Securities Act of 1933, as amended, the Investment
Company Act of 1940, as amended, or by any securities association registered
under the Securities Exchange Act of 1934, as amended.

14. You may, if you desire and at your own cost and expense, appoint or
employ agents to assist you in carrying out your obligations under this
agreement, but no such appointment or employment shall relieve you of any of
your responsibilities or obligations to the Master Portfolio under this
agreement.

15. As to each Master Series, subject to the provisions of Paragraph 8,
this agreement shall continue until the date set forth opposite such Master
Series' name on Schedule 1 hereto (the "Reapproval Date"), and thereafter shall
continue automatically for successive annual periods ending on the day of each
year set forth opposite such Master Series' name on Schedule 1 hereto (the
"Reapproval Day"), provided such continuance is specifically approved at least
annually by (i) the Master Portfolio's Board of Trustees or (ii) vote of a
majority (as defined in the Investment Company Act of 1940, as amended) of the
Master Portfolio's outstanding voting securities, provided that in either event
its continuance also is approved by a majority of the Master Portfolio's
trustees who are not "interested persons" (as defined in said Act) of any party
to this agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This agreement is terminable without penalty, on 60
days' notice, by vote of holders of a majority of the Master Portfolio's shares,
and, as to each Master Series, by the Master Portfolio's Board of Trustees or by
you. This agreement also will terminate automatically, as to the relevant
Master Series, in the event of its assignment (as defined in said Act).

16. This agreement has been executed on behalf of the Master Portfolio
by the undersigned officer of the Master Portfolio in his capacity as an officer
of the Master Portfolio. The obligations of this agreement shall only be
binding upon the assets and property of the relevant Master Series, as provided
for in the Master Portfolio's Agreement and Declaration of Trust, and shall not
be binding upon any Trustee, officer or shareholder of the Master Portfolio or
Master Series individually.

5
<PAGE>

Please confirm that the foregoing is in accordance with your
understanding and indicate your acceptance hereof by signing below, whereupon it
shall become a binding agreement between us.

Very truly yours,

MASTER INVESTMENT PORTFOLIO

By: /s/ Richard H. Blank, Jr.
-------------------------

Name: Richard H. Blank, Jr.

Title: Chief Operating Officer

ACCEPTED:

STEPHENS INC.

By: /s/ Richard H. Blank, Jr.
-------------------------

Name: Richard H. Blank, Jr.

Title: Vice President

6
<PAGE>

SCHEDULE 1
----------

Name of Master Series
- ---------------------

LifePath 2000 Master Series

LifePath 2010 Master Series

LifePath 2020 Master Series

LifePath 2030 Master Series

LifePath 2040 Master Series

Asset Allocation Master Series

Bond Index Master Series

Money Market Master Series

S & P 500 Index Master Series

U.S. Treasury Allocation Master Series

Extended Index Master Series

U.S. Equity Index Master Series

Dated: February 25, 1998
Approved as amended: October 28, 1998 to include the Extended Index and U.S.
Equity Index Master Series

<PAGE>

EXHIBIT 99.B8

CUSTODY AGREEMENT

between

MASTER INVESTMENT PORTFOLIO

and

INVESTORS BANK & TRUST COMPANY
<PAGE>

TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
1. Bank Appointed Custodian...............................................

2. Definitions............................................................
2.1 Authorized Person................................................
2.2 Boa..............................................................
2.3 Security.........................................................
2.4 Portfolio Security...............................................
2.5 Officer's Certificate............................................
2.6 Book-Entry System................................................
2.7 Depository.......................................................
2.8 Proper Instructions..............................................
2.9 Foreign Securities...............................................
2.8 Performance Calculations.........................................

3. Separate Accounts......................................................

4. Certification as to Authorized Persons.................................

5. Custody of Cash........................................................
5.1 Purchase of Securities...........................................
5.2 Redemptions......................................................
5.3 Distributions and Expenses of the Master Portfolios..............
5.4 Payment in Respect of Securities.................................
5.5 Repayment of Loans...............................................
5.6 Repayment of Cash................................................
5.7 Foreign Exchange Transactions....................................
5.8 Other Authorized Payments........................................
5.9 Termination......................................................

6. Securities.............................................................
6.1 Segregation and Registration.....................................
6.2 Voting and Proxies...............................................
6.3 Corporate Action.................................................
6.4 Book-Entry System................................................
6.5 Use of a Depository..............................................
6.6 Use of Book-Entry System for Commercial Paper....................
6.7 Use of Immobilization Programs...................................
6.8 Eurodollar CDs...................................................
6.9 Options and Futures Transactions.................................
6.10 Segregated Account...............................................
6.11 Interest Bearing Call or Time Deposits...........................
6.12 Transfer of Securities...........................................
</TABLE>

i
<PAGE>

<TABLE>
<CAPTION>
<S> <C>
7. Redemptions.........................................................

8. Merger, Dissolution, etc. of the Trust or a Master Portfolio........

9. Actions of the Bank Without Prior Authorization.....................

10. Collections and Defaults............................................

11. Maintenance of Records and Accounting Services......................

12. Master Portfolio Evaluation and Performance Calculation.............
12.1 Master Portfolio Evaluation..................................
12.2 Performance Calculation......................................

13. Concerning the Bank................................................
13.1 Bank Warranty................................................
13.2 Standards of Care and Performance of Duties..................
13.3 Agents and Sub-custodians with Respect to Property
of the Master Portfolios Held in the United States...........
13.4 Duties of the Bank with Respect to Property
Held Outside of the United States............................
13.5 Insurance....................................................
13.6 Fees and Expenses of Bank....................................
13.7 Advances by Bank.............................................

14. Termination.........................................................

15. Confidentiality.....................................................

16. Notices.............................................................

17. Amendments..........................................................

18. Parties.............................................................

19. Governing Law.......................................................

20. Counterparts........................................................

21. Limitations of Liability............................................

22. Single Agreement....................................................
</TABLE>

ii
<PAGE>

CUSTODY AGREEMENT

AGREEMENT made as of this 21st day of October, 1996, between MASTER
INVESTMENT PORTFOLIO, a Delaware business trust (the "Trust"), and INVESTORS
BANK & TRUST COMPANY (the "Bank" or, at times, "IBT").

The Trust, an open-end management investment company registered under
the Investment Company Act of 1940, as amended (the "1940 Act"), on behalf of
the individual Master Portfolios listed on Schedule A hereto, as such Schedule
may be amended from time to time, desires to place and maintain all of the
Master Portfolios' portfolio securities and other assets including cash in the
custody of the Bank, and the Bank has indicated its willingness to so act,
subject to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereto agree as follows:

1. Bank Appointed Custodian. The Trust hereby appoints the Bank as
------------------------
custodian of the Master Portfolios' portfolio securities and cash delivered to
the Bank as hereinafter described, and the Bank agrees to act as such upon the
terms and conditions hereinafter set forth.

2. Definitions. Whenever used herein, the terms listed below will
-----------
have the following meaning:

2.1 Authorized Person. Authorized Person will mean any of the
-----------------
persons duly authorized to give Proper Instructions or otherwise act on behalf
of the Trust and its Master Portfolios by appropriate resolution of the Board of
Trustees of the Trust, and set forth in a certificate as required by Section 4
hereof.

2.2 Board. Board will mean the Trust's Board of Trustees.
-----

2.3 Security. The term security as used herein will have the
--------
same meaning as when such term is used in the Securities Act of 1933, as amended
(the "1933 Act"), including, without limitation, any note, stock, treasury
stock, bond, debenture, evidence of indebtedness, certificate of interest or
participation in any profit sharing agreement, collateral-trust certificate,
preorganization certificate or subscription, transferable share, investment
contract, voting-trust certificate, certificate of deposit for a security,
fractional undivided interest in oil, gas, or other mineral rights, any put,
call, straddle, option, or privilege on any security, certificate of deposit, or
group or index of securities (including any interest therein or based on the
value thereof), or any put, call, straddle, option, or privilege entered into on
a national securities exchange relating to a foreign currency, or, in general,
any interest or instrument commonly known as a "security", or any certificate of
interest or participation in, temporary or interim certificate for, receipt for,
guarantee of, or warrant or right to subscribe to, or option contract to
purchase or sell any of the foregoing, and futures, forward contracts and
options thereon.

1
<PAGE>

2.4 Portfolio Security. Portfolio Security will mean any
------------------
security owned by a Master Portfolio of the Trust.

2.5 Officer's Certificate. Officer's Certificate will mean,
---------------------
unless otherwise indicated, any request, direction, instruction, or
certification in writing signed by an Authorized Person of the Trust.

2.6 Book-Entry System. Book-Entry System shall mean the Federal
-----------------
Reserve-Treasury Department Book Entry System for United States government,
instrumentality and agency securities operated by the Federal Reserve Bank, its
successor(s) and its nominee(s).

2.7 Depository. Depository shall mean The Depository Trust
----------
Company ("DTC") and any other clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), and its successor(s) and its nominee(s). The term
"Depository" shall further mean and include any other person authorized to act
as a depository under the 1940 Act, its successor(s) and its nominee(s),
specifically identified in a certified copy of a resolution of the Board.

2.8 Proper Instructions. Proper Instructions shall mean (i)
-------------------
instructions regarding the purchase or sale of Portfolio Securities, and
payments and deliveries in connection therewith, given by an Authorized Person,
such instructions to be given in such form and manner as the Bank and the Trust
shall agree upon from time to time, and (ii) instructions (which may be
continuing instructions) regarding other matters signed or initialed by an
Authorized Person. Oral instructions will be considered Proper Instructions if
the Bank reasonably believes them to have been given by an Authorized Person.
The Trust shall cause all oral instructions to be promptly confirmed in writing
or by facsimile. The Bank shall act upon and comply with any subsequent Proper
Instruction which modifies a prior instruction, and the sole obligation of the
Bank with respect to any follow-up or confirmatory instruction shall be to make
reasonable efforts to detect any discrepancy between the original instruction
and such confirmation and to report such discrepancy to the Trust. The Trust
shall be responsible, at the expense of the applicable Master Portfolio, for
taking any action, including any reprocessing, necessary to correct any such
discrepancy or error, and, to the extent such action requires the Bank to act,
the Trust shall give the Bank specific Proper Instructions as to the action
required. Upon receipt by the Bank of an Officer's Certificate as to the
authorization by the Board accompanied by a detailed description of procedures
approved by the Trust, Proper Instructions may include communication effected
directly between electromechanical or electronic devices provided that the Trust
and the Bank are satisfied that such procedures afford adequate safeguards for a
Master Portfolio's assets.

2.9 Foreign Securities. The term Foreign Securities as used
------------------
herein will have the same meaning as when such term is used in Rule 17f-5 of the
1940 Act.

2.10 Performance Calculations. Performance Calculations as used
------------------------
herein shall include standard performance calculations required pursuant to the
1933 Act, the 1940 Act, and any applicable rules and interpretations of the
staff of the Securities and Exchange Commission,

2
<PAGE>

and shall also include other non-standard performance calculations as shall be
agreed upon by both parties to this Agreement from time to time.

3. Separate Accounts. The Bank will segregate the assets of each
-----------------
Master Portfolio to which this Agreement relates into a separate account for
each such Master Portfolio containing the assets of such Master Portfolio (and
all investment earnings thereon). Unless the context otherwise requires, any
reference in this Agreement to any actions to be taken by the Trust shall be
deemed to refer to the Trust acting on behalf of one or more of its Master
Portfolios, any reference in this Agreement to any assets of the Trust,
including, without limitation, any Portfolio Securities and other assets
including cash and any earnings thereon, shall be deemed to refer only to assets
of the applicable Master Portfolio, any duty or obligation of the Bank hereunder
to the Trust shall be deemed to refer to duties and obligations with respect to
the individual Master Portfolios, and any obligation or liability of the Trust
hereunder shall be binding only with respect to the individual Master Portfolio
and shall be discharged only out of the assets of such Master Portfolio.

4. Certification as to Authorized Persons. The Secretary or an
--------------------------------------
Assistant Secretary of the Trust will at all times maintain on file with the
Bank his or her certification to the Bank, in such form as may be acceptable to
the Bank, of (i) the names and signatures of the Authorized Persons and (ii) the
names of the Board, it being understood that upon the occurrence of any change
in the information set forth in the most recent certification on file (including
without limitation any person named in the most recent certification who is no
longer an Authorized Person as designated therein), the Secretary or an
Assistant Secretary of the Trust, will sign a new or amended certification
setting forth the change of the new, additional or omitted names or signatures.
The Bank will be entitled to rely and act upon any Officer's Certificate given
to it by the Trust that has been signed by Authorized Persons named in the most
recent certification received by the Bank.

5. Custody of Cash. As custodian, the Bank will open and maintain a
---------------
separate account or accounts in the name of each Master Portfolio or in the name
of the Bank, as custodian of the Master Portfolios, and will deposit to the
account of a Master Portfolio all of the cash of the Master Portfolio, except
for cash held by a sub-custodian appointed pursuant to subsections 13.3 or 13.4
hereof, including borrowed funds, delivered to the Bank, subject only to draft
or order by the Bank acting pursuant to the terms of this Agreement. Upon
receipt by the Bank of Proper Instructions (which may be continuing
instructions) or in the case of payments for redemptions and repurchases of
outstanding interests of a Master Portfolio, notification from the Master
Portfolio's transfer agent as provided in Section 7, requesting such payment,
designating the payee or the account or accounts to which the Bank will release
funds for deposit, and stating that it is for a purpose permitted under the
terms of this Section 5, specifying the applicable subsection, the Bank will
make payments of cash held for the accounts of the Master Portfolio, insofar as
funds are available for that purpose, only as permitted in subsections 5.1-5.9
below.

5.1 Purchase of Securities. Upon the purchase of securities
----------------------
for a Master Portfolio, against contemporaneous receipt of such securities by
the Bank, or against delivery of such securities to the Bank, in accordance with
generally accepted settlement practices or

3
<PAGE>

customs in the jurisdiction or market in which the transaction occurs, such
securities to be registered in the name of the Master Portfolio or in the name
of, or properly endorsed and in form for transfer to, the Bank, or a nominee of
the Bank, or receipt for the account of the Bank pursuant to the provisions of
Section 6 below, each such payment to be made at the purchase price shown on a
broker's confirmation (or transaction report in the case of Book Entry Paper) of
purchase of the securities that is received by the Bank before such payment is
made and that has been confirmed in the Proper Instructions also received by the
Bank before such payment is made.

5.2 Redemptions. In such amount as may be necessary for the
-----------
repurchase or redemption of interests of a Master Portfolio offered for
repurchase or redemption in accordance with Section 7 of this Agreement.

5.3 Distributions and Expenses of the Master Portfolios. For the
---------------------------------------------------
payment on the account of a Master Portfolio of dividends or other distributions
to interestholders as may from time to time be declared by the Board, interest,
taxes, investment advisory or administration fees, and, as and to the extent
provided on Schedule B hereto, any fees of the Bank for its services hereunder
and any reimbursement of the expenses and liabilities of the Bank related to
such services with respect to a Master Portfolio of the Trust as provided
pursuant to subsection 13.6 hereunder and on Schedule B hereto.

5.4 Payment in Respect of Securities. For payments in
--------------------------------
connection with the conversion, exchange or surrender of Portfolio Securities or
securities subscribed to by a Master Portfolio held by or to be delivered to the
Bank.

5.5 Repayment of Loans. To repay loans of money made to a Master
------------------
Portfolio, but, in the case of final payment, only upon redelivery to the Bank
of any Portfolio Securities pledged or hypothecated therefor and upon surrender
of documents evidencing the loan.

5.6 Repayment of Cash. To repay the cash delivered to a Master
-----------------
Portfolio for the purpose of collateralizing the obligation to return to a
Master Portfolio certificates borrowed from the Master Portfolio representing
Portfolio Securities, but only upon redelivery to the Bank of such borrowed
certificates.

5.7 Foreign Exchange Transactions. For payments in connection
-----------------------------
with foreign exchange contracts or options to purchase and sell foreign
currencies for spot and future delivery ("Foreign Exchange Agreements") that may
be entered into by the Bank on behalf of a Master Portfolio upon the receipt of
Proper Instructions, such Proper Instructions to specify the currency broker or
banking institution (which may be the Bank, or any other sub-custodian or agent
hereunder, acting as principal) with which the contract or option is made, and
the Bank shall have no duty with respect to the selection of such currency
brokers or banking institutions with which a Master Portfolio deals or for their
failure to comply with the terms of any contract or option.

5.8 Other Authorized Payments. For other authorized
-------------------------
transactions of a Master Portfolio, or other obligations of a Master Portfolio
incurred for proper purposes with respect to a

4
<PAGE>

Master Portfolio; provided that before making any such payment, the Bank also
will receive Proper Instructions or a certified copy of a resolution of the
Board signed by an Authorized Person (other than the Person certifying such
resolution) and certified by its Secretary or Assistant Secretary, naming the
person or persons to whom such payment is to be made, and either describing the
transaction for which payment is to be made and declaring it to be an authorized
transaction of a Master Portfolio, or specifying the amount of the obligation
for which payment is to be made, setting forth the purpose for which such
obligation was incurred and declaring such purpose to be a proper corporate
purpose.

5.9 Termination. Upon the termination of this Agreement as
-----------
hereinafter set forth pursuant to Section 8 and Section 14 of this Agreement.

6. Securities.
----------

6.1 Segregation and Registration. Except as otherwise provided
----------------------------
herein, and except for Portfolio Securities to be delivered to any sub-custodian
appointed pursuant to subsections 13.2 or 13.3 hereof, the Bank as custodian,
will receive and hold pursuant to the provisions hereof, in a separate account
or accounts and physically segregated at all times from those of other persons,
any and all Portfolio Securities which may now or hereafter be delivered to it
by or for the account of a Master Portfolio. All such Portfolio Securities will
be held or disposed of by the Bank for, and subject at all times to, the
instructions of the Trust pursuant to the terms of this Agreement. Subject to
the specific provisions herein relating to Portfolio Securities that are not
physically held by the Bank, the Bank will register all Portfolio Securities
(unless otherwise directed by Proper Instructions or an Officer's Certificate),
in the name of a registered nominee of the Bank as defined in the Internal
Revenue Code and any Regulations of the Treasury Department issued thereunder,
and will execute and deliver all such certificates in connection therewith as
may be required by such laws or regulations or under the laws of any state. The
Bank will use its best efforts to the end that the specific Portfolio Securities
held by it hereunder will be at all times identifiable.

The Trust, on behalf of a Master Portfolio, will from time to time
furnish to the Bank appropriate instruments to enable it to hold or deliver in
proper form for transfer, or to register in the name of its registered nominee,
any Portfolio Securities which may from time to time be registered in the name
of a Master Portfolio

6.2 Voting and Proxies. Neither the Bank nor any nominee of the
------------------
Bank will vote any of the Portfolio Securities held hereunder, except in
accordance with Proper Instructions or an officers' Certificate. The Bank will
execute and deliver, or will cause to be executed and delivered, to the Trust or
its designated agent all notices, proxies and proxy soliciting materials with
respect to such Portfolio Securities, but without indicating the manner in which
such proxies are to be voted, such proxy to be executed by the registered holder
of such Portfolio Securities (if registered otherwise than in the name of a
Master Portfolio), in accordance with the Proper Instructions or an Officer's
Certificate.

6.3 Corporate Action. If at any time the Bank is notified that
----------------
an issuer of a Portfolio Security has taken or intends to take a corporate
action (a "Corporate Action") that

5
<PAGE>

affects the rights, privileges, powers, preferences, qualifications or ownership
of the Portfolio Security, including, without limitation, liquidation,
consolidation, merger, recapitalization, reorganization, reclassification,
subdivision, combination, stock split or stock dividend, which Corporate Action
requires an affirmative response or action on the part of the holder of such
Portfolio Security (a "Response"), the Bank shall notify the Trust's designee,
Barclays Global Fund Advisors ("BGFA"), promptly of the Corporate Action, the
Response required in connection with the Corporate Action, and the Bank's
deadline for receipt from the Trust's designee, BGFA, of Proper Instructions
regarding the Response (the "Response Deadline"). Except as provided in
subsection 6.3(c) below, the date specified as the Response Deadline shall not
be more than 24 hours prior to the Response expiration day set by the depository
processing such Corporate Action. The Bank shall forward to the Trust's
designee, BGFA, via facsimile and/or overnight courier all notices, information
statements or other materials relating to the Corporate Action within twenty-
four (24) hours of receipt of such materials by the Bank.

(a) The Bank shall act upon a required Response only after
receipt by the Bank of Proper Instructions from the Trust's designee, BGFA, no
later than 4:00 p.m. (Pacific time) on the date specified as the Response
Deadline and only if the Bank (or its agent or sub-custodian hereunder) has
actual possession of all Portfolio Securities (but only if such Portfolio
Securities are necessary for the consummation of the Corporate Action
("Necessary Portfolio Securities")), consents and other materials no later than
4:00 p.m. (Pacific time) on the date specified as the Response Deadline.
Portfolio Securities in the possession of a broker or other borrower pursuant to
the Bank's securities lending program shall be deemed to be in the possession of
the Bank for the purposes of this subsection 6.3.

(b) The Bank shall have no duty to act upon a required
Response if Proper Instructions relating to such Response and all Necessary
Portfolio Securities, consents and other materials are not received by and in
the possession of the Bank no later than 4:00 p.m. (Pacific time) on the date
specified as the Response Deadline. Notwithstanding, the Bank may, in its sole
discretion, use its best efforts to act upon a Response for which Proper
Instructions and/or Necessary Portfolio Securities, consents or other materials
are received by the Bank after 4:00 p.m. (Pacific time) on the date specified as
the Response Deadline, it being acknowledged and agreed by the parties that any
undertaking by the Bank to use its best efforts in such circumstances shall in
no way create any duty upon the Bank to complete such Response prior to its
expiration.

(c) In the event that the Trust's designee, BGFA, notifies
the Bank of a Corporate Action requiring a Response and the Bank has received no
other notice of such Corporate Action, the Response Deadline shall be 48 hours
prior to the Response expiration time set by the depository processing such
Corporate Action.

(d) Subsection 13.4(g) of this Agreement shall govern any
Corporate Action involving Foreign Portfolio Securities held by a Selected
Foreign Sub-custodian.

6.4 Book-Entry System. Provided (i) the Bank has received a
-----------------
certified copy of a resolution of the Board specifically approving deposits of a
Master Portfolio assets in the Book-

6
<PAGE>

Entry System, and (ii) for any subsequent changes to such arrangements following
such approval, the Board has reviewed and approved the arrangement and has not
delivered an Officers Certificate to the Bank indicating that the Board has
withdrawn its approval:

(a) The Bank may keep Portfolio Securities in the Book-Entry
System provided that such Portfolio Securities are represented in an account
("Account") of the Bank (or its agent) in such System that shall not include any
assets of the Bank (or such agent) other than assets held as a fiduciary,
custodian, or otherwise for customers:

(b) The records of the Bank (and any such agent) with respect
to a Master Portfolio's participation in the Book-Entry System through the Bank
(or any such agent) will identify by book entry Portfolio Securities that are
included with other securities deposited in the Account and shall at all times
during the regular business hours of the Bank (or such agent) be open for
inspection by duly authorized officers, employees or agents of the Trust. Where
securities are transferred to a Master Portfolio's account, the Bank shall also,
by book entry or otherwise, identify as belonging to the Master Portfolio a
quantity of Portfolio Securities in a fungible bulk of securities (i) registered
in the name of the Bank or its nominee, or (ii) shown on the Bank's account on
the books of the Federal Reserve Bank;

(c) The Bank (or its agent) shall pay for securities
purchased for the account of a Master Portfolio or shall pay cash collateral
against the return of Portfolio Securities loaned by a Master Portfolio upon (i)
receipt of advice from the Book-Entry System that such Securities have been
transferred to the Account, and (ii) the making of an entry on the records of
the Bank (or its agent) to reflect such payment and transfer for the account of
the Master Portfolio. The Bank (or its agent) shall transfer Portfolio
Securities sold or loaned for the account of a Master Portfolio upon:

(i) receipt of advice from the Book-Entry System that
payment for securities sold or payment of the initial cash collateral against
the delivery of Portfolio Securities loaned by the Master Portfolio has been
transferred to the Account: and

(ii) the making of an entry on the records of the Bank
(or its agent) to reflect such transfer and payment for the account of a Master
Portfolio. Copies of all advices from the Book-Entry System of transfers of
Portfolio Securities for the account of a Master Portfolio shall identify the
Master Portfolio, be maintained for the Master Portfolio by the Bank and shall
be provided to the Master Portfolio at its request. The Bank shall send a Master
Portfolio a confirmation, as defined by Rule 17f-4 of the 1940 Act, of any
transfers to or from the account of the Master Portfolio;

(d) The Bank will promptly provide the Trust with any
report obtained by the Bank or its agent on the Book-Entry System's accounting
system, internal accounting control and procedures for safeguarding securities
deposited in the Book-Entry System;

(e) The Bank shall be liable to the Trust and a Master
Portfolio for any loss or damage to the Master Portfolio resulting from use of
the Book-Entry System by reason of any negligent actions or inactions of the
Bank or any of its agents or of any of its or their employees,

7
<PAGE>

or from any failure by the Bank or any such agent to use its best efforts to
enforce such rights as it may have against the Book-Entry System; at the
election of the Master Portfolio, it shall be entitled to be subrogated for the
Bank in any claim against the Book-Entry System or any other person that the
Bank or its agent may have as a consequence of any such loss or damage if and to
the extent that the Master Portfolio has not been made whole for any loss or
damage;

6.5 Use of a Depository. Provided (i) the Bank has received a
-------------------
certified copy of a resolution of the Board specifically approving deposits in
DTC or other such Depository and (ii) for any subsequent changes to such
arrangements following such approval, the Board has reviewed and approved the
arrangement and has not delivered an Officer's Certificate to the Bank
indicating that the Board has withdrawn its approval:

(a) The Bank may use a Depository to hold, receive,
exchange, release, lend, deliver and otherwise deal with Portfolio Securities
including stock dividends, rights and other items of like nature, and to receive
and remit to the Bank on behalf of a Master Portfolio all income and other
payments thereon and to take all steps necessary and proper in connection with
the collection thereof;

(b) Registration of Portfolio Securities may be made in the
name of any nominee or nominees used by such Depository;

(c) Payment for securities purchased and sold may be made
through the clearing medium employed by such Depository for transactions of
participants acting through it. Upon any purchase of Portfolio Securities,
payment will be made only upon delivery of the securities to or for the account
of a Master Portfolio and the Master Portfolio shall pay cash collateral against
the return of Portfolio Securities loaned by the Master Portfolio only upon
delivery of the Securities to or for the account of the Master Portfolio; and
upon any sale of Portfolio Securities, delivery of the Securities will be made
only against payment thereof or, in the event Portfolio Securities are loaned,
delivery of Securities will be made only against receipt of the initial cash
collateral to or for the account of the Master Portfolio: and

(d) The Bank shall be liable to a Master Portfolio for any
loss or damage to a Master Portfolio resulting from use of a Depository by
reason of any negligent actions or inactions of the Bank or its employees or
from any failure by the Bank to use its best efforts to enforce such rights as
it may have against a Depository. In this connection, the Bank shall use its
best efforts to ensure that:

(i) The Depository obtains replacement of any
certificated Portfolio Security deposited with it in the event such Security is
lost, destroyed, wrongfully taken or otherwise not available to be returned to
the Bank upon its request;

(ii) Any proxy materials received by a Depository with
respect to Portfolio Securities deposited with such Depository are forwarded
immediately to the Bank for voting in accordance with subsection 6.2 above;

8
<PAGE>

(iii) Such Depository immediately forwards to the Bank
confirmation of any purchase or sale of Portfolio Securities and of the
appropriate book entry made by such Depository to a Master Portfolio's account;

(iv) Such Depository prepares and delivers to the Bank
such records with respect to the performance of the Bank's obligations and
duties hereunder as may be necessary for a Master Portfolio to comply with the
recordkeeping requirements of Section 31(a) of the 1940 Act and Rule 31(a)
thereunder; and

(v) Such Depository delivers to the Bank and the
Trust all internal accounting control reports, whether or not audited by an
independent public accountant, as well as such other reports as the Trust may
reasonably request in order to verify the Portfolio Securities held by such
Depository.

6.6 Use of Book-Entry System for Commercial Paper.
---------------------------------------------
Provided (i) the Bank has received a certified copy of a resolution of the Board
specifically approving participation in a system maintained by the Bank for the
holding of commercial paper in book-entry form ("Book-Entry Paper") and (ii) for
each year following such approval the Board has received and approved the
arrangements, upon receipt of Proper Instructions and upon receipt of
confirmation from an Issuer (as defined below) that a Master Portfolio has
purchased such Issuer's Book-Entry Paper, the Bank shall issue and hold in book-
entry form, on behalf of the Master Portfolio, commercial paper issued by
issuers with whom the Bank has entered into a book-entry agreement (the
"Issuers"). In maintaining its procedures for Book-Entry Paper, the Bank agrees
that:

(a) The Bank will maintain all Book-Entry Paper held by a
Master Portfolio in an account of the Bank that includes only assets held by it
for customers;

(b) The records of the Bank with respect to a Master
Portfolio's purchase of Book-Entry Paper through the Bank will identify, by
book-entry, commercial paper belonging to the Master Portfolio that is included
in the Book-Entry Paper System and shall at all times during the regular
business hours of the Bank be open for inspection by duly authorized officers,
employees or agents of the Trust;

(c) The Bank shall pay for Book-Entry Paper purchased for
the account of a Master Portfolio upon contemporaneous (i) receipt of advice
from the Issuer that such sale of Book-Entry Paper has been effected, and (ii)
the making of an entry on the records of the Bank to reflect such payment and
transfer for the account of the Master Portfolio;

(d) The Bank shall cancel such Book-Entry Paper obligation
upon the maturity thereof upon contemporaneous (i) receipt of advice that
payment for such Book-Entry Paper has been transferred to the Master Portfolio,
and (ii) the making of an entry on the records of the Bank to reflect such
payment for the account of the Master Portfolio;

9
<PAGE>

(e) The Bank shall transmit to the Trust a transaction
journal confirming each transaction in Book-Entry Paper for the account of a
Master Portfolio on the next business day following the transaction: and

(f) The Bank will send to the Trust such reports on its
system of internal accounting control with respect to Book-Entry Paper as the
Trust may reasonably request from time to time.

6.7 Use of Immobilization Programs. Provided (i) the Bank has
------------------------------
received a certified copy of a resolution of the Board specifically approving
the maintenance of Portfolio Securities in an immobilization program operated by
a bank which meets the requirements of Section 26(a)(1) of the 1940 Act, and
(ii) for each year following such approval the Board has reviewed and approved
the arrangement and has not delivered an Officer's Certificate to the Bank
indicating that the Board has withdrawn its approval, the Bank shall enter into
such immobilization program with such bank acting as a sub-custodian hereunder.

6.8 Eurodollar CDs. Any Portfolio Securities that are
--------------
Eurodollar CDs may be physically held by the European branch of the U.S. banking
institution that is the issuer of such Eurodollar CD (a "European Branch"),
provided that such Portfolio Securities are identified on the books of the Bank
as belonging to a Master Portfolio and that the books of the Bank identify the
European Branch holding such Portfolio Securities. Notwithstanding any other
provision of this Agreement to the contrary, except as stated in the first
sentence of this subsection 6.8, the Bank shall be under no other duty with
respect to such Eurodollar CDs belonging to a Master Portfolio, and the Bank
shall have no liability to the Master Portfolio or its interestholders with
respect to the actions, inactions, whether negligent or otherwise of such
European Branch in connection with such Eurodollar CDs, except for any loss or
damage to the Master Portfolio resulting from the Bank's own negligent actions
or inactions or lack of reasonable care in the performance of its duties
hereunder.

6.9 Options and Futures Transactions.
--------------------------------

(a) Puts and Calls Traded on Securities Exchanges, NASDAQ or
Over-the Counter.

(i) The Bank shall take action as to put options
("puts") and call options ("calls") purchased or sold (written) by a Master
Portfolio regarding escrow or other arrangements in accordance with the
provisions of any agreement entered into upon receipt of Proper Instructions
between the Bank, any broker-dealer registered under the Exchange Act and a
member of the National Association of Securities Dealers, Inc. (the "NASD"),
and, if necessary, the Trust, on behalf of the Master Portfolio, relating to the
compliance with the rules of the Options Clearing Corporation and of any
registered national securities exchange, or of any similar organization or
organizations.

(ii) Unless another agreement requires it to do so,
the Bank shall be under no duty or obligation to see that a Master Portfolio has
deposited or is maintaining adequate margin, if required, with any broker in
connection with any option, nor shall the Bank

10
<PAGE>

be under duty or obligation to present such option to the broker for exercise
unless it receives Proper Instructions from the Trust. The Bank shall have no
responsibility for the legality of any put or call purchased or sold on behalf
of a Master Portfolio, the propriety of any such purchase or sale, or the
adequacy of any collateral delivered to a broker in connection with an option or
deposited to or withdrawn from a Segregated Account (as defined in subsection
6.10 below). The Bank specifically, but not by way of limitation, shall not be
under any duty or obligation to: (1) periodically check or notify a Master
Portfolio that the amount of such collateral held by a broker or held in a
Segregated Account is sufficient to protect such broker or the Master Portfolio
against any loss; (2) effect the return of any collateral delivered to a broker;
or (3) advise the Master Portfolio that any option it holds, has or is about to
expire. Such duties or obligations shall be the sole responsibility of a Trust.

(b) Puts, Calls and Futures Traded on Commodities Exchanges

(i) The Bank shall take action, upon receipt of
Proper Instructions, as to puts, calls and futures contracts ("futures")
purchased or sold by a Master Portfolio in accordance with the provisions of any
agreement among the Trust, on behalf of a Master Portfolio, the Bank 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, or any similar organization(s), regarding
account deposits in connection with transactions by the Master Portfolio.

(ii) The responsibilities and liabilities of the Bank
as to futures, puts and calls traded on commodities exchanges, any Futures
Commission Merchant account and the Segregated Account shall be limited as set
forth in subparagraph (a)(ii) of this subsection 6.9 as if such subparagraph
referred to Futures Commission Merchants rather than brokers, and futures and
puts and calls thereon instead of options.

6.10 Segregated Account. The Bank shall upon receipt of Proper
------------------
Instructions establish and maintain a Segregated Account or Accounts for and on
behalf of a Master Portfolio, into which Account or Accounts may be transferred
upon receipt of Proper Instructions, cash and/or Portfolio Securities.

(a) Cash and/or Portfolio Securities may be transferred into
a Segregated Account in the following circumstances, upon receipt of Proper
Instructions:

(i) in accordance with the provisions of any agreement among the
Trust, on behalf of a Master Portfolio, the Bank 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 organizations regarding escrow or
other arrangements in connection with transactions by a Master Portfolio;

11
<PAGE>

(ii) for the purpose of segregating cash or Securities in connection
with options purchased or written by a Master Portfolio or commodity futures
purchased or written by a Master Portfolio;

(iii) for the deposit of liquid assets, such as cash, U.S. Government
obligations or other high-grade debt obligations, having a market value (marked-
to-market on a daily basis) at all times equal to not less than the aggregate
purchase price due on the settlement dates of all a Master Portfolio's then
outstanding forward commitment or "when-issued agreements relating to the
purchase of Portfolio Securities and all a Master Portfolio's then outstanding
commitments under any reverse repurchase agreements entered into with broker-
dealer firms;

(iv) for the purposes of compliance by a Master Portfolio with the
procedures required by Investment Company Act Release No. 10666, or any
subsequent release or releases of the Securities and Exchange Commission
relating to the maintenance of Segregated Accounts by registered investment
companies;

(v) for other proper corporate purposes, but only, in the case of
this clause (v), upon receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board, or of the Executive Committee,
signed by an officer of the Trust and certified by the Secretary or an Assistant
Secretary, setting forth the purpose(s) of such Segregated Account and declaring
such purpose(s) to be a proper corporate purpose(s).

(b) assets may be withdrawn from the Segregated Account pursuant
to Proper Instructions only:

(i) with respect to assets deposited in accordance with the
provisions of any agreements referenced in (a)(i) or (a)(ii) above, in
accordance with the provisions of such agreements;

(ii) with respect to assets deposited pursuant to (a)(iii) or
(a)(iv) above, for sale or delivery to meet a Master Portfolio's obligations
under outstanding forward-commitment, delayed-settlement or when-issued
agreements for the purchase of Portfolio Securities and under reverse repurchase
agreements;

(iii) for exchange for other liquid assets of equal or greater
value deposited in the Segregated Account;

(iv) to the extent that a Master Portfolio's outstanding forward-
commitment or when-issued agreements for the purchase of portfolio securities or
any reverse repurchase agreements are sold to other parties or the Master
Portfolio's obligations thereunder are met from assets of the Master Portfolio
other than those in the Segregated Account;

(v) for delivery upon settlement of a forward-commitment, delayed-
settlement or when-issued agreement for the sale of Portfolio Securities: or

12
<PAGE>

(vi) with respect to assets deposited pursuant to (a)(v) above, in
accordance with the purposes of such account as set forth in Proper
Instructions.

6.11 Interest Bearing Call or Time Deposits. The Bank shall, upon
--------------------------------------
receipt of Proper Instructions relating to the purchase by a Master Portfolio of
interest-bearing fixed-term and call deposits, transfer cash, by wire or
otherwise, in such amounts and to such bank(s) as shall be indicated in such
Proper Instructions. The Bank shall include in its records with respect to the
assets of a Master Portfolio appropriate notation as to the amount of each such
deposit, the banking institution with which such deposit is made (the "Deposit
Bank"), and shall retain such forms of advice or receipt evidencing the deposit,
if any, as may be forwarded to the Bank by the Deposit Bank. Such deposits
shall be deemed Portfolio Securities of a Master Portfolio and the
responsibility of the Bank therefore shall be the same as and no greater than
the Bank's responsibility in respect of other Portfolio Securities of the Master
Portfolio.

6.12 Transfer of Securities. The Bank will transfer, exchange,
----------------------
deliver or release Portfolio Securities held by it hereunder, insofar as such
Securities are available for such purpose, provided that before making any
transfer, exchange, delivery or release under this Section, the Bank will
receive Proper Instructions requesting such transfer, exchange or delivery
stating that it is for a purpose permitted under the terms of this subsection
6.12, specifying the applicable subsection, or describing the purpose of the
transaction with sufficient particularity to permit the Bank to ascertain the
applicable subsection, only:

(a) upon sales of Portfolio Securities for the account of a Master
Portfolio, against contemporaneous receipt by the Bank of payment therefor in
full, or against payment to the Bank in accordance with generally accepted
settlement practices and customs in the jurisdiction or market in which the
transaction occurs, each such payment to be in the amount of the sale price
shown in a broker's confirmation of sale of the Portfolio Securities received by
the Bank before such payment is made, as confirmed in the Proper Instructions
received by the Bank before such payment is made;

(b) in exchange for, or upon conversion into, other securities alone
or other securities and cash pursuant to any plan of merger, consolidation,
reorganization, share split-up, change in par value, recapitalization or
readjustment or otherwise, upon exercise of subscription, purchase or sale or
other similar rights represented by such Portfolio Securities, or for the
purpose of tendering shares in the event of a tender offer therefor, provided
however that in the event of an offer of exchange, tender offer, or other
exercise of rights requiring the physical tender or delivery of Portfolio
Securities, the Bank shall have no liability for failure to so tender in a
timely manner unless such Proper Instructions are received by the Bank at least
two business days prior to the date required for tender, and unless the Bank (or
its agent or sub-custodian hereunder) has actual possession of such Portfolio
Security at least two business days prior to the date of tender

13
<PAGE>

(d) for the purpose of redeeming in kind interests of a Master
Portfolio upon authorization from the Master Portfolio;

(e) in the case of option contracts owned by a Master Portfolio,
for presentation to the endorsing broker;

(f) when such Portfolio Securities are called, redeemed or retired
or otherwise become payable;

(g) for the purpose of effectuating the pledge of Portfolio
Securities held by the Bank in order to collateralize loans made to a Master
Portfolio by any bank, including the Bank; provided, however, that such
Securities will be released only upon payment to the Bank for the account of the
Master Portfolio of the moneys borrowed, except that in cases where additional
collateral is required to secure a borrowing already made, and such fact is made
to appear in the Proper Instructions, further Portfolio Securities may be
released for that purpose without any such payment. In the event that any such
pledged Portfolio Securities are held by the Bank, they will be so held for the
account of the lender, and after notice to the Master Portfolio from the lender
in accordance with the normal procedures of the lender, that an event of
deficiency or default on the loan has occurred, the Bank may deliver such
pledged Portfolio Securities to or for the account of the lender,

(h) for the purpose of releasing certificates representing Portfolio
Securities, against contemporaneous receipt by the Bank of the fair market value
of such security, as set forth in the Proper Instructions received by the Bank
before such payment is made;

(i) for the purpose of delivering Portfolio Securities lent by a
Master Portfolio to a bank or broker dealer, but only against receipt in
accordance with street delivery custom except as otherwise provided herein, of
adequate collateral as agreed upon from time to time by the Master Portfolio and
the Bank, and upon receipt of payment in connection with any repurchase
agreement relating to such Securities entered into by the Master Portfolio;

(j) for other authorized transactions of a Master Portfolio or for
other proper corporate purposes; provided that before making such transfer, the
Bank will also receive a certified copy of resolutions of the Board, signed by
an authorized officer of the Trust (other than the officer certifying such
resolution) and certified by its Secretary or an Assistant Secretary, specifying
the Portfolio Securities to be delivered, setting forth the transaction in or
purpose for which such delivery is to be made, declaring such transaction to be
an authorized transaction of the Master Portfolio or such purpose to be a proper
corporate purpose, and naming the person or persons to whom delivery of such
Securities shall be made; and

(k) upon termination of this Agreement as hereinafter set forth
pursuant to Section 8 and Section 14 of this Agreement.

As to any deliveries made by the Bank pursuant to subsections (a), (b),
(c), (e), (f), (g), (h) and (i) securities or cash receivable in exchange
therefor shall be delivered to the Bank.

14
<PAGE>

7. Redemptions. In the case of payment of assets of a Master Portfolio
-----------
held by the Bank in connection with redemptions and repurchases by the Master
Portfolio of outstanding interests, the Bank will rely on notification by the
Trust's transfer agent of receipt of a request for redemption before such
payment is made. Payment shall be made in accordance with the Amended and
Restated Declaration of Trust (the "Trust Declaration") and By-Laws of the
Trust, from assets available for said purpose.

8. Merger, Dissolution. etc. of the Trust or a Master Portfolio. In the
------------------------------------------------------------
case of the following transactions, not in the ordinary course of business,
namely, the merger of a Master Portfolio into or the consolidation of the Trust
with another investment company, the sale by the Trust of all, or substantially
all, of the assets of one or more Master Portfolios to another investment
company, or the liquidation or dissolution of a Master Portfolio and
distribution of its assets, the Bank will deliver the Portfolio Securities held
by it under this Agreement and disburse cash only upon the order of the Trust,
on behalf of such Master Portfolio(s) set forth in an Officer's Certificate,
accompanied by a certified copy of a resolution of the Board authorizing any of
the foregoing transactions. Upon completion of such delivery and disbursement
and the payment of the fees, disbursements and expenses of the Bank, this
Agreement will terminate with respect to such Master Portfolio or Trust, as
applicable.

9. Actions of the Bank Without Prior Authorization. Notwithstanding
-----------------------------------------------
anything herein to the contrary, unless and until the Bank receives an Officer's
Certificate to the contrary, it will without prior authorization or instruction
of the Trust or the transfer agent:

(a) Endorse for collection and collect on behalf of and in the name
of a Master Portfolio all checks, drafts, or other negotiable or transferable
instruments or other orders for the payment of money received by it for the
account of the Master Portfolio and hold for the account of the Master Portfolio
all income, dividends, interest and other payments or distributions of cash with
respect to the Portfolio Securities held thereunder;

(b) Present for payment all coupons and other income items held by it
for the account of a Master Portfolio that call for payment upon presentation
and hold the cash received by it upon such payment for the account of the Master
Portfolio;

(c) Receive and hold for the account of a Master Portfolio all
securities received as a distribution on Portfolio Securities as a result of a
stock dividend, share split-up, reorganization, recapitalization, merger,
consolidation, readjustment, distribution of rights and similar securities
issued with respect to any Portfolio Securities held by it hereunder.

(d) execute as agent on behalf of a Master Portfolio all necessary
ownership and other certificates and affidavits required by the Internal Revenue
Code or the regulations of the Treasury Department issued thereunder, or by the
laws of any state, now or hereafter in effect, inserting a Master Portfolio's
name on such certificates as the owner of the securities covered thereby, to the
extent it may lawfully do so and as may be required to obtain payment in respect
thereof. The Bank will execute and deliver such certificates in connection with
Portfolio Securities delivered to it or by it under this Agreement as may be
required under the provisions

15
<PAGE>

of the Internal Revenue Code and any Regulations of the Treasury Department
issued thereunder, or under the laws of any State;

(e) present for payment all Portfolio Securities that are called,
redeemed, retired or otherwise become payable, and hold cash received by it upon
payment for the account of a Master Portfolio; and

(f) exchange interim receipts or temporary securities for
definitive securities.

10. Collections and Defaults. The Bank will use all reasonable efforts to
------------------------
collect any funds that may to its knowledge become collectible arising from
Portfolio Securities, including dividends, interest and other income, and to
transmit to the Trust, on behalf of a Master Portfolio, notice actually received
by the Bank of any call for redemption, offer of exchange, right of
subscription, reorganization or other proceedings affecting such Portfolio
Securities. If Portfolio Securities upon which such income is payable are in
default or payment is refused after due demand or presentation, the Bank will
notify the Trust, on behalf of a Master Portfolio, in writing of any default or
refusal to pay within two business days from the day on which it receives
knowledge of such default or refusal. In addition, the Bank will send the Trust
a written report once each month showing any income on any Portfolio Security
held by Bank on behalf of a Master Portfolio that is more than ten days overdue
on the date of such report.

11. Maintenance of Records and Accounting Services. The Bank will
----------------------------------------------
maintain records with respect to transactions for which the Bank is responsible
pursuant to the terms and conditions of this Agreement, and in compliance with
the applicable rules and regulations of the 1940 Act and will furnish the Trust
daily with a statement of condition of each Master Portfolio. The Bank will
furnish to the Trust at the end of every month, and at the close of each quarter
of the Trust's fiscal year, a list of the Portfolio Securities and the aggregate
amount of cash held by Bank on behalf of each Master Portfolio. The books and
records of the Bank pertaining to its actions under this Agreement and reports
by the Bank or its independent accountants concerning its accounting system,
procedures for safeguarding securities and internal accounting controls will be
open to inspection and audit at reasonable times by officers of or auditors
employed by the Trust and will be preserved by the Bank in the manner and in
accordance with the applicable rules and regulations under the 1940 Act.

The Bank shall perform the fund accounting services listed on Schedule
C hereto and shall keep the books of account and render statements or copies
from time to time as reasonably requested by the Treasurer or any executive
officer of the Trust.

The Bank shall assist generally in the preparation of reports to
shareholders and others, audits of accounts, and other ministerial matters of
like nature.

12. Master Portfolio Evaluation and Performance Calculations.
--------------------------------------------------------

12.1 Master Portfolio Evaluation. The Bank shall compute and, unless
---------------------------
otherwise directed by the Board, determine as of the close of regular trading on
the New York Stock Exchange on each day on which said Exchange is open for
unrestricted trading and as of such

16
<PAGE>

other days, or hours, if any, as may be authorized by the Board, the net asset
value and the offering price of an interest of each Master Portfolio, such
determination to be made in accordance with the provisions of the Trust
Declaration and By-Laws and Registration Statement of the Trust relating to the
Master Portfolios, as it may from time to time be amended, and any applicable
resolutions of the Board at the time in force and applicable; and promptly to
notify the Trust, any applicable exchange, the NASD or such other persons as the
Trust may request of the results of such computation and determination. In
computing the net asset value hereunder, the Bank may rely in good faith upon
information that the Bank reasonably believes to be accurate and reliable
furnished to it by any Authorized Person in respect of (i) the manner of accrual
of the liabilities of each Master Portfolio and in respect of liabilities of a
Master Portfolio not appearing on its books of account kept by the Bank, (ii)
reserves, if any, authorized by the Board or that no such reserves have been
authorized, (iii) the source of the quotations to be used in computing the net
asset value, (iv) the value to be assigned to any security for which no price
quotations are available, and (v) the method of computation of the offering
price on the basis of the net asset value of the interests, and the Bank shall
not be responsible for any loss occasioned by its reasonable and good faith
reliance on any quotations received from a source pursuant to (iii) above.

12.2. Performance Calculations. The Bank will compute the performance
------------------------
results of each Master Portfolio (the "Performance Calculations") in accordance
with applicable provisions of the 1933 Act and 1940 Act and the rules under such
Acts related to the computations to be undertaken by the Bank pursuant to this
Agreement, as promulgated by the Securities and Exchange Commission, as such
provisions and or rules may be amended from time to time, and any published
interpretations of or general conventions accepted by the staff of the
Securities and Exchange Commission with respect to such rules or the subject
matter thereof ("Subsequent Staff Positions"), subject to the Registration
Statement, as amended from time to time, and the terms set forth below:

(a) The Bank shall compute the Performance Calculations for each
Master Portfolio for the stated periods of time as shall be mutually agreed
upon, and communicate in a timely manner the result of such computation to the
Trust.

(b) In performing the Performance Calculations, the Bank will derive
from the records it generates and maintains for each Master Portfolio pursuant
Section 11 hereof, the data necessary for the computation. The Bank shall have
no responsibility to review, confirm, or otherwise assume any duty or liability
with respect to the accuracy or correctness of any such data supplied to it by
the Trust, any of the its designated agents or any of its designated third-party
providers.

(c) At the request of the Bank, the Trust shall provide, and the Bank
shall be entitled to rely on, written standards and guidelines to be followed by
the Bank in interpreting and applying the computation methods pursuant to the
rules or any Subsequent Staff Positions as they specifically apply to a Master
Portfolio, provided that the Bank shall be responsible for general knowledge of
such rules and any Subsequent Staff Positions. In the event that the
computation methods in a rule or the Subsequent Staff Positions or the
application to a Master

17
<PAGE>

Portfolio of a standard or guideline is not free from doubt or in the event
there is any question of interpretation as to the characterization of a
particular security or any aspect of a security or a payment with respect
thereto (e.g., original issue discount, participating debt security, income or
return of capital, etc.) or otherwise or as to any other element of the
computation that is pertinent to the Master Portfolio, the Trust or its
designated agent, BGFA, shall have the full responsibility for making the
determination of how the security, or payment, is to be treated for purposes of
the computation and how the computation is to be made and shall inform the Bank
thereof on a timely basis. The Bank shall have no responsibility to make
independent determinations with respect to any item that is covered by this
Section, and the Bank shall not be responsible for its computations made in
accordance with such determinations so long as such computations are
mathematically correct.

(d) The Trust shall keep the Bank informed of all publicly available
information, and of any non-public advice or information, obtained by the Trust
from its independent auditors or by its personnel or the personnel of its
investment adviser, related to the computations to be undertaken by the Bank
pursuant to this Agreement, and the Bank shall not be deemed to have knowledge
of such information (except as contained in the Registration Statement) unless
it has been furnished to the Bank in writing.; provided that the Bank shall be
charged with knowledge of any material changes to the 1933 Act, the 1940 Act,
and any related rules under such acts related to the computations to be
undertaken by the Bank pursuant to this Agreement without specific notice from
the Trust.

13. Concerning the Bank.
-------------------

13.1 Bank Warranty. The Bank warrants that it has and will maintain
-------------
at least the minimum qualifications required by Section 17(f)(1) of the 1940 Act
to act as custodian of the Portfolio Securities and other assets including cash
of the Trust's Master Portfolios.

13.2 Standard of Care and Performance of Duties.
------------------------------------------

(a) The Bank agrees to use reasonable care with regard to its
obligations under this Agreement and the safekeeping of property of the Master
Portfolios. In performing its duties hereunder and any other duties listed on
the Schedules hereto, the Bank will be entitled to receive and act upon the
advice of independent counsel of its own selection, which may be counsel for the
Trust, and the Bank will be without liability for any action taken or thing
done, or omitted to be done, so long as the Bank's actions or inactions are
without negligence and in accordance with this Agreement in good faith in
conformity with such advice. The Bank shall be liable to, and shall indemnify
and hold harmless the Trust from and against any loss which shall occur as the
result of the failure of the Bank or a sub-custodian (other than a foreign
securities depository or clearing agency and except as provided in subsections
6.8, 13.2 and 13.3(i) hereof) to exercise reasonable care with respect to their
respective obligations under this Agreement and the safekeeping of such
property. Subject to the foregoing, the Bank will not be responsible for any
act, omission, default or for the solvency of any foreign securities depository
or clearing agency utilized in connection with the provision of services under
this Agreement.

18
<PAGE>

(b) In the performance of its duties hereunder, the Bank will be
protected and not be liable, and will be indemnified and held harmless for any
action taken or omitted to be taken by it with reasonable care and in good faith
reliance upon the terms of this Agreement, any Officer's Certificate, Proper
Instructions, resolution of the Board, facsimile, telegram, notice, request,
certificate or other instrument reasonably believed by the Bank to be genuine
and for any other loss to the Fund except in the case of its negligent actions
or inactions or lack of good faith or reasonable care in the performance of its
obligations or duties hereunder.

(i) the validity of the issue of any Portfolio Securities
purchased by or for a Master Portfolio, the legality of the purchases thereof
or the propriety of the price incurred therefor;

(ii) the legality of any sale of any Portfolio Securities by or
for the Master Portfolio or the propriety of the amount for which the same are
sold;

(iii) the legality of an issue or sale of any interests of a
Master Portfolio or the sufficiency of the amount to be received therefor;

(iv) the legality of the repurchase of any interests of a Master
Portfolio or the propriety of the amount to be paid therefor;

(v) the legality of the declaration of any dividend by a Master
Portfolio or the legality of the distribution of any Portfolio Securities as
payment in kind of such dividend; and

(vi) any property or moneys of a Master Portfolio unless and until
received by it, and any such property or moneys delivered or paid by it pursuant
to the terms hereof.

(d) Moreover, the Bank will not be under any duty or obligation to
ascertain whether any Portfolio Securities at any time delivered to or held by
it for the account of a Master Portfolio are such as may properly be held by the
Master Portfolio under the provisions of its Trust Declaration, By-Laws, any
federal or state statutes or any rule or regulation of any governmental agency.

(e) Notwithstanding anything in this Agreement to the contrary, in no
event shall the Bank be liable hereunder or to any third party:

(i) for any losses or damages of any kind resulting from acts of
God, earthquakes, fires, floods, storms or other disturbances of nature,
epidemics, strikes, riots, nationalization, expropriation, currency
restrictions, acts of war, civil war or terrorism, insurrection, nuclear fusion,
fission or radiation, the interruption, loss or malfunction of utilities,
transportation, or computers (hardware or software) and computer facilities, the
unavailability of

19
<PAGE>

energy sources and other similar happenings or events, except as results from
the Bank's own negligence, provided that the Bank shall make all reasonable
efforts, whenever necessary, to use data processing back-up facilities provided
by Electronic Data Systems, Inc.; or

(ii) for special, punitive or consequential damages arising from the
provision of services hereunder, even if the Bank has been advised of the
possibility of such damages; provided, however, that the parties specifically
acknowledge and agree that damages, if any, incurred by the Trust, its Master
Portfolios or its agents (including, but not limited to, BGFA or the Trust's
transfer or shareholder servicing agents) on account of late or incorrect net
asset values and related information provided to the Trust, its Master
Portfolios, its agents or other third parties as may be agreed in writing by BGI
and IBT from time to time, are not to be considered special, punitive or
consequential damages for purposes of this subsection 13.2(e)(ii).

(f) The Bank shall supply BGI with such daily information regarding
the cash and securities positions and activity of each Master Portfolio as the
Bank and BGI shall from time to time agree.

(g) The Bank need not maintain any insurance for the exclusive
benefit of the Trust, but hereby warrants that as of the date of this Agreement
it is maintaining a bankers Blanket Bond and hereby agrees to notify the Trust
in the event that such bond is canceled or otherwise lapses.

13.3 Agents and Sub-custodians with Respect to Property of the Master
----------------------------------------------------------------
Portfolios Held in the United States. The Bank may employ agents in the
- ------------------------------------
performance of its duties hereunder and shall be responsible for the acts and
omissions of such agents as if performed by the Bank hereunder. Without
limiting the foregoing, certain duties of the Bank hereunder may be performed by
one or more affiliates of the Bank.

Upon receipt of Proper Instructions, the Bank may employ sub-custodians,
provided that any such sub-custodian meets at least the minimum qualifications
required by Section 17(f)(1) of the 1940 Act to act as a custodian of a Master
Portfolio's assets with respect to property of the Master Portfolio held in the
United States. The Bank shall have no liability to the Trust or any other
person by reason of any act or omission of any sub-custodian and the Trust shall
indemnify the Bank and hold it harmless from and against any and all actions,
suits and claims, arising directly or indirectly out of the performance of any
sub-custodian. Upon request of the Bank, the Trust shall assume the entire
defense of any action, suit, or claim subject to the foregoing indemnity. All
fees and expenses of any sub-custodian shall be paid in accordance with Schedule
B hereto.

13.4 Duties of the Bank with Respect to Property of the Master
---------------------------------------------------------
Portfolio Held Outside of the United States.
- -------------------------------------------

(a) Appointment of Foreign Sub-custodians. The Trust hereby
-------------------------------------
authorizes and instructs the Bank to employ as sub-custodians for the Trust's
Portfolio Securities and other assets maintained outside the United States the
foreign banking institutions and foreign securities depositories designated by
the Board (each, a "Selected Foreign Sub-custodian"). Upon receipt

20
<PAGE>

of Proper Instructions, together with a certified resolution of the Trust's
Board of Trustees, the Bank and the Trust may agree to designate additional
foreign banking institutions and foreign securities depositories to act as
Selected Foreign Sub-custodians hereunder. Upon receipt of Proper Instructions,
the Trust may instruct the Bank to cease the employment of any one or more such
Selected Foreign Sub-custodians for maintaining custody of a Master Portfolio's
assets, and the Bank shall so cease to employ such sub-custodian as soon as
alternate custodial arrangements have been implemented.

(b) Foreign Securities Depositories. Except as may otherwise be
-------------------------------
agreed upon in writing by the Bank and the Trust, assets of a Master Portfolio
shall be maintained in foreign securities depositories only through arrangements
implemented by the foreign banking institutions serving as Selected Foreign Sub-
custodians pursuant to the terms hereof. Where possible, such arrangements
shall include entry into agreements containing the provisions set forth in
subparagraph (d) hereof. Notwithstanding the foregoing, except as may otherwise
be agreed upon in writing by the Bank and the Trust, the Trust authorizes the
deposit in Euro-Clear, the securities clearance and depository facilities
operated by Morgan Guaranty Trust Company of New York in Brussels, Belgium, of
Foreign Securities eligible for deposit therein and to utilize such securities
depository in connection with settlements of purchases and sales of securities
and deliveries and returns of securities, until notified to the contrary
pursuant to subparagraph (a) hereunder.

(c) Segregation of Securities. The Bank shall identify on its books
-------------------------
as belonging to a Master Portfolio the Foreign Securities held by each Selected
Foreign Sub-custodian. Each agreement pursuant to which the Bank employs a
foreign banking institution shall require that such institution establish a
custody account for the Bank and hold in that account, Foreign Securities and
other assets of the Master Portfolios, and, in the event that such institution
deposits Foreign Securities in a foreign securities depository, that it shall
identify on its books as belonging to the Bank the securities so deposited.

(d) Agreements with Foreign Banking Institutions. Each of the
--------------------------------------------
agreements pursuant to which a foreign banking institution holds assets of the
Trust's Master Portfolios (each, a "Foreign Sub-custodian Agreement") shall be
substantially in the form previously made available to the Trust and shall
provide that: (a) such assets will not be subject to any right, charge, security
interest, lien or claim of any kind in favor of the foreign banking institution
or its creditors or agent, except a claim of payment for their safe custody or
administration (including, without limitation, any fees or taxes payable upon
transfers or reregistration of securities); (b) beneficial ownership of such
assets will be freely transferable without the payment of money or value other
than for custody or administration (including, without limitation, any fees or
taxes payable upon transfers or reregistration of securities); (c) adequate
records will be maintained identifying the assets as belonging to the Bank; (d)
officers of or auditors employed by, or other representatives of the Bank,
including to the extent permitted under applicable law, the independent auditors
for the Trust, will be given access to the books and records of the foreign
banking institution relating to its actions under its agreement with the Bank;
and (e) assets of a Master Portfolio held by the Selected Foreign Sub-custodian
will be subject only to the instructions of the Bank or its agents.

21
<PAGE>

(e) Access of Independent Auditors of the Trust. Upon request of the
-------------------------------------------
Trust, the Bank will use its best efforts to arrange for the Trust's independent
auditors to be afforded access to the books and records of any foreign banking
institution employed as a Selected Foreign Sub-custodian insofar as such books
and records relate to the performance of such foreign banking institution under
its Foreign Sub-custodian Agreement.

(f) Reports by the Bank. The Bank will supply to the Trust from time
-------------------
to time, as mutually agreed upon, statements in respect of the securities and
other assets of a Master Portfolio held by Selected Foreign Sub-custodians,
including but not limited to an identification of entities having possession of
the Foreign Portfolio Securities and other assets of the Master Portfolio.

(g) Transactions in Foreign Custody Accounts. Transactions with
----------------------------------------
respect to the assets of a Master Portfolio held by a Selected Foreign Sub-
custodian shall be effected pursuant to Proper Instructions from the Trust to
the Bank and shall be effected in accordance with the applicable Foreign Sub-
custodian Agreement. If at any time any Foreign Portfolio Securities shall be
registered in the name of the nominee of the Selected Foreign Sub-custodian, the
Trust agrees to hold any such nominee harmless from any liability by reason of
the registration of such securities in the name of such nominee.

Notwithstanding any provision of this Agreement to the contrary, settlement
and payment for Foreign Securities received for the account of a Master
Portfolio and delivery of Foreign Securities maintained for the account of a
Master Portfolio may be effected in accordance with the customary established
securities trading or securities processing practices and procedures in the
jurisdiction or market in which the transaction occurs, including, without
limitation, delivering securities to the purchaser thereof or to a dealer
therefor (or an agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such securities from such purchaser
or dealer.

In connection with any action to be taken with respect to the Foreign
Securities held hereunder, including, without limitation, the exercise of any
voting rights, subscription rights, redemption rights, exchange rights,
conversion rights or tender rights, or any other action in connection with any
other right, interest or privilege with respect to such Securities
(collectively, the "Rights"), the Bank shall promptly transmit to the Trust or
its investment adviser such information in connection therewith as is made
available to the Bank by the Foreign Sub-custodian, and the Bank shall promptly
forward to the applicable Foreign Sub-custodian any instructions, forms or
certifications with respect to such Rights, and any instructions relating to the
actions to be taken in connection therewith, as the Bank shall receive pursuant
to Proper Instructions. The Bank agrees to use its best efforts to obtain and
forward to the Trust or its designated agent, BGFA, information regarding Rights
with respect to Foreign Securities held hereunder. Notwithstanding the
foregoing, the Bank shall have no further duty or obligation with respect to
such Rights, including, without limitation, the determination of whether a
Master Portfolio is entitled to participate in such Rights under applicable U.S.
and foreign laws, or the determination of whether any action proposed to be
taken with respect to such Rights by the Master Portfolio or by the applicable
Foreign Sub-custodian will comply with all applicable

22
<PAGE>

terms and conditions of any such Rights or any applicable laws or regulations,
or market practices within the market in which such action is to be taken or
omitted.

(h) Liability of Selected Foreign Sub-custodians. Each Foreign Sub-
--------------------------------------------
custodian Agreement with a foreign banking institution shall require the
institution to exercise reasonable care in the performance of its duties and to
indemnify, and hold harmless, the Bank and Trust from and against certain
losses, damages, costs, expenses, liabilities or claims arising out of or in
connection with the institution's performance of such obligations, all as set
forth in the applicable Foreign Sub-custodian Agreement. The Trust acknowledges
that the Bank, as a participant in Euroclear, is subject to the Terms and
Conditions Governing the Euroclear System, a copy of which has been made
available to the Trust. The Trust acknowledges that pursuant to such Terms and
Conditions, Morgan Guaranty Brussels shall have the sole right to exercise or
assert any and all rights or claims in respect of actions or omissions of, or
the bankruptcy or insolvency of, any other depository, clearance system or
custodian utilized by Euroclear in connection with a Master Portfolio's
Portfolio Securities and other assets.

(i) Liability of Bank. The Bank shall have no more or less
-----------------
responsibility or liability on account of the acts or omissions of any Selected
Foreign Sub-custodian employed hereunder than any such Selected Foreign Sub-
custodian has to the Bank and, without limiting the foregoing, the Bank shall
not be liable for any loss, damage, cost, expense, liability or claim resulting
from nationalization, expropriation, currency restrictions, or acts of war or
terrorism, political risk (including, but not limited to, exchange control
restrictions, confiscation, insurrection, civil strife or armed hostilities)
other losses due to Acts of God, nuclear incident or any loss where the Selected
Foreign Sub-custodian has otherwise exercised reasonable care.

(j) Monitoring Responsibilities. The Bank shall furnish annually to
---------------------------
the Trust, information concerning the Selected Foreign Sub-custodians employed
hereunder for use by the Trust's Board or its designated agent in evaluating
such Selected Foreign Sub-custodians to ensure compliance with the requirements
of Rule 17f-5 of the 1940 Act. In addition, the Bank will promptly inform the
Trust in the event that the Bank is notified by a Selected Foreign Sub-custodian
that there appears to be a substantial likelihood that its shareholders' equity
will decline below $200 million (U.S. dollars or the equivalent thereof) or that
its shareholders' equity has declined below $200 million (in each case computed
in accordance with generally accepted U.S. accounting principles) or any other
capital adequacy test applicable to it by exemptive order, or if the Bank has
actual knowledge of any material loss of the assets of a Master Portfolio held
by a Foreign Sub-custodian.

(k) Tax Law. The Bank shall have no liability for any obligations
-------
now or hereafter imposed on the Trust, or its Master Portfolios, or the Bank as
custodian of the Trust by the tax laws of any jurisdiction. The sole
responsibility of the Bank with regard to such taxes shall be to use reasonable
efforts to assist the Trust with respect to the withholding and payment by the
Trust of such taxes and with respect to any claim for exemption or refund under
the tax law of jurisdictions for which the Trust is entitled to such exemptions
or refunds.

23
<PAGE>

13.5 Insurance. The Bank shall use the same care with respect to the
---------
safekeeping of Portfolio Securities and cash of the Trust's Master Portfolios
held by it as it uses in respect of its own similar property but need not
maintain any special insurance for the benefit of the Trust.

13.6. Fees and Expenses of Bank. The Trust, on behalf of a Master
-------------------------
Portfolio, will pay or reimburse the Bank from time to time for any transfer
taxes payable upon transfer of Portfolio Securities made hereunder. All
necessary proper disbursements, expenses and charges made or incurred by the
Bank in the performance of this Agreement (including any duties listed on
Schedule C hereto) including any indemnities for any loss, liabilities or
expense to the Bank as provided above shall be paid in accordance with Schedule
B hereto, provided that the Bank shall not be entitled to compensation and/or
reimbursement for services and/or expenses and liabilities by the Trust, with
respect to the Master Portfolios (with the exception of the Extended Index and
U.S. Equity Index Master Portfolios), hereunder so long as the Bank is entitled
to receive compensation and reimbursements from Barclays Global Investors, N.A.
("BGI") for providing sub-administration services to the Trust on behalf of the
Master Portfolios. If the Bank no longer is entitled to receive such
compensation and reimbursements from BGI, the Bank shall be entitled hereunder
to such compensation or fees and reimbursements at such rate and at such times
as it may from time to time negotiate with the Trust, and such Schedule B shall
be amended accordingly.

13.7 Advances by Bank. The Bank may, in its sole discretion, advance
----------------
funds on behalf of a Master Portfolio to make any payment permitted by this
Agreement upon receipt of any proper authorization required by this Agreement
for such payments. Should such a payment or payments, with advanced funds,
result in an overdraft (due to insufficiencies of a Master Portfolio's account
with the Bank, or for any other reason) this Agreement deems any such overdraft
or related indebtedness, a loan made by the Bank to the Master Portfolio payable
on demand and bearing interest at the current rate charged by the Bank for such
loans unless the Master Portfolio shall provide the Bank with agreed upon
compensating balances. The Trust agrees that the Bank shall have a continuing
lien and security interest to the extent of any overdraft or indebtedness, in
and to any property at any time held by it for a Master Portfolio's benefit or
in which the Master Portfolio has an interest and which is then in the Bank's
possession or control (or in the possession or control of any third party acting
on the Bank's behalf). The Trust authorizes the Bank, in its sole discretion,
at any time to charge any overdraft or indebtedness, together with interest due
thereon against any balance of account standing to the credit of a Master
Portfolio on the Bank's books.

14. Termination.
-----------

(a) This Agreement shall be effective for an initial term of two (2)
years commencing upon the date hereof (the "Initial Term") unless earlier
terminated as provided in subsection (b) below. Thereafter, the Agreement may
be terminated at any time, without penalty upon sixty (60) days' written notice
delivered by either party to the other by means of registered mail, and upon the
expiration of such sixty (60) days, this Agreement will terminate; provided,
however, that the effective date of such termination may be postponed to a date
not more than ninety (90) days from the date of delivery of such notice (i) by
the Bank in order to prepare for

24
<PAGE>

the transfer by the Bank of all of the assets of the Master Portfolios held
hereunder, or (ii) by the Trust in order to give it an opportunity to make
suitable arrangements for a successor custodian. At any time after the
termination of this Agreement, the Bank agrees to make available to the Trust,
at its request, the records maintained by the Bank relating to the performance
of its duties as custodian and to preserve such records for the periods
prescribed in Rule 31a-2 under the 1940 Act.

(b) Notwithstanding subsection (a) above, either party hereto may
terminate this Agreement at any time prior to the expiration of the Initial Term
in the event that the other party violates any material provision of this
Agreement, provided that the violating party does not cure such violation within
ninety (90) days of receipt of written notice from the non-violating party of
such violation.

(c) Notwithstanding subsection (a) above, the Trust may terminate
this Agreement at any time prior to the expiration of the Initial Term in the
event that (i) the Board of Trustees determines that the performance of the Bank
does not meet the reasonable satisfaction (considered in light of industry
standards) of the Board of Trustees, provided that the Bank does not cure such
unsatisfactory performance within ninety (90) days of receipt of written notice
specifying such unsatisfactory performance; or (ii) if the Bank becomes the
subject of any state or federal bankruptcy proceeding that is not dismissed
within sixty (60) days of the initiation of such proceeding.

(d) In the event of the termination of this Agreement, the Bank will
immediately upon receipt or transmittal, as the case may be, of notice of
termination, commence and prosecute diligently to completion the transfer of all
cash and the delivery of all Portfolio Securities duly endorsed and all records
maintained under Section 11 to the successor custodian when appointed by the
Trust. The obligation of the Bank to deliver and transfer over the assets of
the Trust's Master Portfolios held by the Bank directly to such successor
custodian will commence as soon as such successor is appointed and will continue
until completed as aforesaid. If the Trust does not select a successor
custodian within ninety (90) days from the date of delivery of notice of
termination the Bank may, subject to the provisions of subsection 14(c), deliver
the Portfolio Securities and cash of the Trust's Master Portfolio held by the
Bank to a bank or trust company of its own selection that meets the requirements
of Section 17(f)(1) of the 1940 Act and has a reported capital, surplus and
undivided profits aggregating not less than $2,000,000, to be held as the
property of the Trust's Master Portfolios under terms similar to those on which
they were held by the Bank, whereupon such bank or trust company so selected by
the Bank will become the successor custodian of such assets of the Trust's
Master Portfolios with the same effect as though selected by the Board.

(e) Prior to the expiration of ninety (90) days after notice of
termination has been given, the Trust may furnish the Bank with an order of the
Trust advising that a successor custodian cannot be found willing and able to
act upon reasonable and customary terms and that there has been submitted to the
Master Portfolio's interestholders the question of whether a Master Portfolio
will be liquidated or will function without a custodian for the assets of the
Master Portfolio. In that event the Bank will deliver the Portfolio Securities
and cash of the

25
<PAGE>

Trust's Master Portfolios, subject as aforesaid, in accordance with one of such
alternatives that may be approved by the requisite vote of shareholders, upon
receipt by the Bank of a copy of the minutes of the meeting of shareholders at
which action was taken, certified by the Trust's Secretary and an opinion of
counsel to the Trust in form and content satisfactory to the Bank.

15. Confidentiality. Both parties hereto agree than any non-public
---------------
information obtained hereunder concerning the other party is confidential and
may not be disclosed to any other person without the consent of the other party,
except as may be required by applicable law or at the request of a governmental
agency. The parties further agree that a breach of this provision would
irreparably damage the other party and accordingly agree that each of them is
entitled, in addition to all other remedies at law or in equity and without bond
or other security, to an injunction or injunctions to prevent breaches of this
provision.

16. Notices. Any notice or other instrument in writing authorized or
-------
required by this Agreement to be given to either party hereto will be
sufficiently given if addressed to such party and delivered, via registered U.S.
Mail or facsimile with written confirmation via registered U.S. Mail, to it at
its office at the address set forth below; namely:

(a) In the case of notices sent to the Trust or a Master Portfolio
to:

Master Investment Portfolio
111 Center Street
Little Rock, AR 72201
Attention: Richard H. Blank, Jr.

With a copy to:

Barclays Global Investors
45 Fremont Street
San Francisco, CA 94105
Attention: Legal Department

(b) In the case of notices sent to the Bank to:

Investors Bank & Trust Company
89 South Street
Boston, Massachusetts 02111
Attention: Andrew Nesvet

With a copy to: John E. Henry

or at such other place as such party may from time to time designate in
writing.

26
<PAGE>

17. Amendments. This Agreement may not be altered or amended, except by
----------
an instrument in writing, executed by both parties, and in the case of the
Trust, such alteration or amendment will be authorized and approved by its
Board.

18. Parties. This Agreement will be binding upon and shall inure to the
-------
benefit of the parties hereto and their respective successors and assigns;
provided, however, that this Agreement will not be assignable by the Trust
without the written consent of the Bank or by the Bank without the written
consent of the Trust, authorized and approved by its Board; and provided further
that termination proceedings pursuant to Section 14 hereof will not be deemed to
be an assignment within the meaning of this provision.

19. Governing Law. This Agreement and all performance hereunder will be
-------------
governed by the laws of the Commonwealth of Massachusetts.

20. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.

21. Limitation of Liability. The Trust and the Bank agree that the
-----------------------
Trust's obligations under this Agreement shall not be binding upon any Trustee,
interestholder, officer, employee or agent of the Trust individually but are
binding only upon the assets and property of the appropriate Master Portfolio.

22. Single Agreement. This Agreement (including any exhibits, appendices
----------------
and schedules hereto) constitutes the entire agreement between the Bank and the
Trust as to the subject matter hereof and supersedes any and all agreements,
representations and warranties, written or oral, regarding such subject matter
made prior to the time at which this Agreement has been executed and delivered
between the Bank and the Trust.

23. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.

27
<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first written above.

Master Investment Portfolio

By: /s/ Richard H. Blank, Jr.
-------------------------
Name: Richard H. Blank, Jr.
Title: Chief Operating Officer

Investors Bank & Trust Company

By: /s/ Robert D. Mancuso
---------------------
Name: Robert D. Mancuso
Title: Managing Director

Investors Bank & Trust Company

By: /s/ John E. Henry
-----------------
Name: John E. Henry
Title: General Counsel

28
<PAGE>

Schedule A
----------

Custody Agreement
Master Investment Portfolio

List of Master Portfolios
-------------------------

LifePath 2000 Master Portfolio

LifePath 2010 Master Portfolio

LifePath 2020 Master Portfolio

LifePath 2030 Master Portfolio

LifePath 2040 Master Portfolio

Asset Allocation Master Portfolio

Bond Index Master Portfolio

Money Market Master Portfolio

S & P 500 Index Master Portfolio

U.S. Treasury Allocation Master Portfolio

Extended Index Master Portfolio

U.S. Equity Index Master Portfolio

Dated: October 21, 1996
Amended: June 11, 1998 to include the Money Market Master Portfolio
Amended: October 28, 1998 to include the Extended Index and U.S. Equity Index
Master Portfolios

A-1
<PAGE>

Schedule B
----------

Custody Agreement
Master Investment Portfolio

IBT shall not be entitled to separate compensation from MIP for
providing custody and fund accounting services to MIP's Master Portfolios (with
the exception of the Extended Index and U.S. Equity Index Master Portfolios)
pursuant to this Agreement so long as IBT is entitled to receive fees and
related expenses from BGI, pursuant to the Sub-administration Agreement between
BGI and IBT, for providing such custody and fund accounting services to MIP's
Master Portfolios. If IBT is no longer entitled to receive such fees and
expenses under such Sub-administration Agreement, then IBT shall be entitled to
receive compensation from MIP as IBT may from time to time negotiate with MIP,
and this Schedule B shall be amended accordingly.

B-1
<PAGE>

Schedule C
----------

Custody Agreement
Master Investment Portfolio

Fund Accounting Duties
----------------------

I. A. Journals containing an itemized daily record in detail of all
purchases and sales of securities, all receipts and disbursements of cash and
all other debits and credits, as required by subsection (b)(1) of rule 31a-1
under the 1940 Act (the "Rule");

B. General and auxiliary ledgers reflecting all asset, liability,
reserve, capital, income and expense accounts, including interest accrued and
interest received, as required by subsection (b)(2)(i) of the Rule;

C. Separate ledger accounts required by subsection (b) (2) (ii) and
(iii) of the Rule; and

D. A monthly trial balance of all ledger accounts (except shareholder
accounts) as required by subsection (b)(8) of the Rule.

II. All such books and records shall be the property of the Trust, and IBT
agrees to make such books and records available for inspection by the Trust or
by the Securities and Exchange Commission at reasonable times and otherwise to
keep confidential all records and other information relative to the Trust;
except when requested to divulge such information by duly constituted
authorities or court process, or when requested by the Trust.

III. In addition to the maintenance of the books and records specified
above, IBT shall perform the following accounting services daily for each Master
Portfolio;

A. Calculate the net asset value per interest;

B. Calculate changes in net asset value;

C-1
<PAGE>

C. Calculate the per share dividend distribution rates:

D. Calculate dividends and any capital-gain distributions;

E. Calculate performance figures, including any yield or total return
and other performance figures, as appropriate;

F. Provide the following reports:

1. a current security position report;

2. a summary report of transactions and pending maturities
(including the principal cost, and accrued interest on each
portfolio security in maturity date order); and

3. a current cash position report (including cash available from
portfolio sales and maturities and sales of a Master Portfolio's
interests less cash needed for redemptions and settlement of
portfolio purchases);

G. Such other similar services with respect to a Master Portfolio as
may be reasonably requested by the Trust.

IV. IBT shall forward the information contained in Section III of this
Schedule to third-party service providers reasonably requested by the Trust, the
Co-Administrators or BGFA.

C-2

<PAGE>
EXHIBIT 99.B9(a)

CO-ADMINISTRATION AGREEMENT

Master Investment Portfolio
111 Center Street
Little Rock, Arkansas 72201

October 21, 1996

Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201

Barclays Global Investors, N.A.
45 Fremont Street
San Francisco, CA 94105

Ladies and Gentlemen:

This will confirm the agreement among Master Investment Portfolio (the
"Trust") on behalf of its Master Portfolios listed in the attached Appendix A;
as such Appendix may be amended from time to time (each, a "Master Portfolio"
and, collectively, the "Master Portfolios"), Barclays Global Investors, N.A.
("BGI") and Stephens Inc. ("Stephens", together with BGI, the "Co-
administrators") as follows:

1. The Trust is a registered open-end, management investment company. The
Trust engages in the business of investing and reinvesting the assets of each
Master Portfolio in the manner and in accordance with the applicable investment
objective, policies and restrictions specified in the Trust's currently
effective Registration Statement, as amended from time to time (the
"Registration Statement"), filed by the Trust under the Investment Company Act
of 1940 (the "Act"). Copies of the Registration Statement, as most recently
amended, have been furnished to the Co-administrators. Any amendments to the
Registration Statement shall be furnished to the Co-administrators promptly.

2. The Trust is engaging the Co-administrators to provide, or cause to be
provided, the administrative services specified elsewhere in this agreement,
subject to the overall supervision of the Trust's Board of Trustees. Pursuant
to advisory contracts between the Trust and Barclays Global Fund Advisors (the
"Adviser") on behalf of each Master Portfolio, the Trust has engaged the Adviser
to manage the investing and reinvesting of the assets of the Master Portfolios
and to provide advisory services as specified in such advisory contracts.

1
<PAGE>

3. The Co-administrators agree, at their expense, to supervise the
administrative operations and undertake to provide, or cause to be provided, the
services described on Appendix B, as such Appendix may be amended from time to
time by the mutual consent of the parties, the provision of, and liability
thereto, for certain of such services to be allocated on such Appendix, in
connection with the operations of the Trust and the Master Portfolios, and take
all reasonable action in the performance of their obligations under this
agreement to assure that the necessary information is made available to other
service providers, as such may be required by the Trust from time to time; and
to provide all other administrative services reasonably necessary for the
operation of the Master Portfolios, other than those services that are to be
provided by the Adviser pursuant to the advisory contracts and by the Trust's
transfer and dividend disbursing agent and custodian.

4. Except as provided in the advisory contracts on behalf of each of the
Trust's Master Portfolios and in this agreement, and only for so long as the Co-
administrators are entitled to compensation for providing co-administration
services to a feeder fund that invests substantially all of its assets in a
corresponding Master Portfolio, the Co-administrators agree to bear such feeder
fund's pro rata portion of the costs of the operations of such Master Portfolio,
including, but not limited to, its pro rata portion of the compensation of the
Trust's trustees who are not affiliated with the Adviser, the Co-administrators
or any of their affiliates; governmental fees; interest charges; taxes; fees and
expenses of its independent auditors, legal counsel (other than in connection
with litigation), transfer agent and dividend disbursing agent; fees paid to
shareholder servicing and other special purpose agents; expenses of preparing
and printing any Parts A or B, interestholders' reports, notices, proxy
statements and reports to regulatory agencies; travel expenses of trustees of
the Trust in connection with their attendance at Board and other meetings
relating to the Trust; office supplies; premiums for fidelity bonds and errors
and omissions and/or officers and trustees liability insurance; trade
association membership dues; fees and expenses of any custodian and fund
accountant, including those for keeping books and accounts and calculating the
net asset value per interest of the Master Portfolios; expenses of
interestholders' meetings; expenses relating to the issuance, registration,
qualification and redemption of interests of the Master Portfolios; any pricing
services; and organizational expenses. Notwithstanding anything to the
contrary, the Co-administrators shall not be required to bear any portion of
brokerage fees payable to the Adviser under its advisory contracts with the
Trust and other expenses connected with the execution of portfolio securities
transactions, litigation expenses, taxes (including income, excise, transfer and
withholding taxes) or cost or expense that a majority of the disinterested
trustees of the Trust deems to be an extraordinary expense. Expenses
attributable to one or more, but not all, of the Master Portfolios shall be
charged against the assets of the relevant Master Portfolios. General expenses
of the Trust shall be allocated among the Master Portfolios in a manner

2
<PAGE>

proportionate to the net assets of each Master Portfolio, on a transactional
basis or on such other basis as the Board of Trustees deems equitable.

5. Each Co-administrator shall exercise reasonable care and shall give the
Trust the benefit of the Co-administrator's best judgment and efforts in
rendering services under this agreement. As an inducement to the Co-
administrators' undertaking to render services hereunder, the Trust agrees that
a Co-administrator shall not be liable under this agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this agreement shall be deemed to protect or purport to
protect the Co-administrator against any liability to the Trust or its
interestholders to which the Co-administrator would otherwise be subject by
reason of willful misfeasance, bad faith or negligence in the performance of the
Co-administrators' duties under this agreement or by reason of reckless
disregard of its obligations and duties hereunder.

6. The Co-administrators shall not be entitled to compensation for
providing administrative services to a Master Portfolio so long as the Co-
administrators are entitled to receive fees for providing similar services to a
feeder fund of another registered investment company that invests all of its
assets in the Master Portfolio.

7. This agreement shall become effective on its execution date.
Thereafter, this agreement shall continue with respect to a Master Portfolio for
successive annual periods only so long as the continuance is specifically
approved at least annually (a) by the vote of a majority of the Master
Portfolio's outstanding voting securities (as defined in the Act) or by the
Trust's Board of Trustees and (b) by the vote, cast in person at a meeting
called for the purpose, of a majority of the Trust's trustees who are not
parties to this contract or "interested persons" (as defined in the Act) of any
such party. This contract may be terminated at any time by the Trust without
the payment of any penalty, by a vote of a majority of the Master Portfolio's
outstanding voting securities (as defined in the Act) or by a vote of a majority
of the Trust's entire Board of Trustee's on 60 days' written notice to the Co-
administrators, or by the Co-administrators on 60 days' written notice to the
Trust. This contract shall terminate automatically in the event of its
assignment (as defined in the Act).

8. Except to the extent necessary to perform the Co-administrators'
obligations under this agreement, nothing herein shall be deemed to limit or
restrict the right of the Co-administrators, or any affiliate of the Co-
administrators, or any employee of the Co-administrators, to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.

3
<PAGE>

9. This agreement shall be governed by and construed in accordance with
the laws of the State of Arkansas.

10. The Trust hereby agrees and acknowledges that each Co-administrator
may allocate or further delegate responsibility for any or all of the services
to be provided hereunder, as listed on Appendix B hereto, between each Co-
administrator; provided that the Co-administrators shall have joint and several
liability for the provision of the services under this agreement, except that
BGI or Stephens each agree to assume sole responsibility, and related liability
thereto, for providing the duties and services identified as the sole
responsibility of BGI or Stephens on such Appendix B; and, further provided that
each Co-administrator agrees to remain fully liable to the Trust for the
provision of any service that such Co-administrator delegates to another entity.

12. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.

4
<PAGE>

If the foregoing correctly sets forth the agreement between the Trust and
the Co-administrators, please so indicate by signing and returning to the Trust
the enclosed copy hereof.

Very truly yours,

MASTER INVESTMENT PORTFOLIO,

on behalf of LifePath 2000, LifePath 2010,
LifePath 2020, LifePath 2030, LifePath
2040, Asset Allocation, Bond Index, S&P
500 Index, and U.S. Treasury Allocation
Master Portfolios

By: /s/Richard H. Blank, Jr.
---------------------------------
Name: Richard H. Blank, Jr.
Title: Chief Operating Officer,
Secretary and Treasurer

ACCEPTED as of the date
set forth above:

BARCLAYS GLOBAL INVESTORS, N.A.

By: /s/Donald Luskin
---------------------------
Name: Donald Luskin
Title: Vice Chairman

BARCLAYS GLOBAL INVESTORS, N.A.

By: /s/Matthew Shelton
--------------------------------
Name: Matthew Shelton
Title: Principal

STEPHENS INC.

By: /s/Richard H. Blank, Jr.
----------------------------------
Name: Richard H. Blank, Jr.
Title: Vice President

5
<PAGE>

Appendix A

Master Investment Portfolio
---------------------------

LifePath 2000 Master Portfolio

LifePath 2010 Master Portfolio

LifePath 2020 Master Portfolio

LifePath 2030 Master Portfolio

LifePath 2040 Master Portfolio

Asset Allocation Master Portfolio

Bond Index Master Portfolio

Money Market Master Portfolio

S & P 500 Index Master Portfolio

U.S. Treasury Allocation Master Portfolio

Extended Index Master Portfolio

U.S. Equity Index Master Portfolio

Dated: October 21, 1996
as amended: June 11, 1998 to include the Money Market Master Portfolio
as amended: October 28, 1998 to include the Extended Index and U.S. Equity
Index Master Portfolios

A-1
<PAGE>

Appendix B

Master Investment Portfolio
---------------------------

LIST OF ADMINISTRATIVE SERVICES
-------------------------------

Stephens Inc.
- -------------

(1) Review agenda and assemble Board materials for quarterly Board meetings;
prepare supporting information when necessary; prepare minutes of Board and
committee meetings.

(2) Review and approve Board material.

(3) Provide expense budgets.

(4) Monitor actual expenses and update budgets/expense accruals as necessary.

(5) Review and authorize filing of Forms N-SAR.

(6) Maintain records of sales and file appropriate registrations and renewals,
sales information and other required material for Blue Sky purposes.

(7) Review and provide advice to the distributor and the Trust on behalf of the
Master Portfolios and investment adviser regarding sales literature and
marketing plans to assure regulatory compliance.

Barclays Global Investors
- -------------------------

(8) Continuously monitor portfolio activity and related functions in
conjunction with all applicable regulatory requirements. Take corrective
action as necessary.

(9) Identify the services to which the Funds report performance information.
Provide information as requested on performance questionnaires.

(10) Prepare appropriate management letter and coordinate production of
Management Discussion and Analysis, with respect to the preparation and
printing of shareholder reports.

B-1
<PAGE>

(11) Coordinate review and approval by portfolio managers of portfolio listings
to be included in financial statements, with respect to the preparation and
printing of shareholder reports.

(12) Prepare selected portfolio and financial information for inclusion in Board
material.

(13) Assist in presentation to Board as desired by Fund Officer(s).

(14) Calculate total return information and other statistical information
including undistributed income and capital gains with respect to condensed
financial information for review by management.

(15) Perform tests of specific portfolio activities against compliance
checklists designed from the provisions of the Masters' and Money Market
Fund's current Prospectus and SAI.

(16) Calculate dividend amounts available for distribution.

(17) Coordinate review of dividend amounts by management and auditors.

(18) Notify fund accounting and transfer agent of authorized dividends rates.

(19) Prepare responses to various performance questionnaires; coordinate as
necessary, and submit responses to the appropriate agency;

(20) Prepare Forms N-SAR for filing; obtain any necessary supporting documents;
file with the SEC via EDGAR.

(21) Draft semi-annual and annual shareholder reports and coordinate auditor and
management review.

(22) Coordinate printing of reports and EDGAR conversion with outside printer
and filing with the SEC via EDGAR.

(23) Provide information for Financial Highlights and expense tables.

(24) Continuously monitor portfolio activity regarding diversification in
conjunction with IRS requirements for registered investment companies.

(25) Continuously monitor portfolio activity regarding "short short" income and
qualifying income in conjunction with IRS requirements for registered
investment companies.

B-2
<PAGE>

Stephens Inc. and Barclays Global Investors
- -------------------------------------------

(26) Prepare, or assist in the preparation, and file with the SEC and state
securities regulators, if applicable, registration statements, notices,
reports, and other material required to be filed under applicable laws.

(27) Review financial information and take any necessary action.

(28) Develop and implement procedures for monitoring compliance with regulatory
requirements and compliance with each Master Portfolio's investment
objective, policies and restrictions as established by the Trust's Board,
perform compliance testing and approve resolution of compliance issues.

(29) Approve dividend rates; obtain Board approval when required.

(30) Determine allocation of invoices among funds. Authorize and send to fund
accountants for payment of expenses.

(31) Coordinate activities of other vendors as necessary.

(32) Provide appropriate responses to Forms N-SAR.

(33) Provide marketing input of shareholder report style and graphics.

(34) Review and approve entire shareholder report.

(35) Review drafts and coordinate review process of Forms N-1A updates and
prospectus supplements.

(36) Coordinate printing, EDGAR conversion, and filing with the SEC with outside
printers of Forms N-1A.

(37) Maintain and preserve the corporate records of the Company, including each
Master Portfolio.

(38) Make appropriate representations in conjunction with audit.

(39) Review diversification test results and corrective actions taken, with
respect to qualifications as a registered investment company.

B-3
<PAGE>

(40) Approve tax positions taken regarding qualification as a registered
investment company.

(41) Review "short short" income and qualifying income test results and
corrective actions taken, with respect to qualifications as a registered
investment company.

(42) Approve tax positions taken regarding "short short" income and qualifying
income, with respect to qualifications as a registered investment company.

(43) Approve tax accounting positions to be taken.

(44) Approve distributions

(45) Review tax returns and coordinate signature thereof with a Fund Officer.

Approved: October 21, 1996

Signed: /s/Donald Luskin Signed: /s/Richard H. Blank, Jr
---------------------- -----------------------------
By: Donald Luskin By: Richard H. Blank, Jr.
Managing Director Vice President
Barclays Global Stephens, Inc.
Investors, N.A.

Signed: /s/ Matthew Shelton
-----------------------
By: Matthew Shelton
Principal
Barclays Global
Investors, N.A.

Signed: /s/ Richard H. Blank, Jr.
----------------------------
By: Richard H. Blank, Jr., Chief Operating Officer
Master Investment Portfolio

B-4

<PAGE>

EXHIBIT 99.B9(b)

SUB-ADMINISTRATION AGREEMENT

October 21, 1996

Investors Bank & Trust Company
89 South Street
Boston, MA 02111

Ladies and Gentlemen:

This will confirm the agreement between Investors Bank & Trust Company
("IBT" or, at times, the "Sub-administrator") and Barclays Global Investors,
N.A. ("BGI" or, at times, the "Co-administrator") with respect to Master
Investment Portfolio ("MIP"), on behalf of its Master Portfolios, Managed Series
Investment Trust ("MSI Trust"), on behalf of its Master Portfolios, and
MasterWorks Funds Inc. ("MasterWorks"), on behalf of its Funds, listed in the
attached Appendix A, as such Appendix may be amended from time to time (the
"Master Portfolios" and Funds are, collectively, the "Portfolios"), as follows:

1. (a) MIP is a registered open-end, management investment company
consisting of a number of operating investment portfolios in accordance with
MIP's Amended and Restated Declaration of Trust (the "MIP Declaration"). MIP
engages in the business of investing and reinvesting the assets of each Master
Portfolio in the manner and in accordance with the applicable investment
objective, policies and restrictions specified in MIP's currently effective
Registration Statement, as amended from time to time (the "Registration
Statement"), filed under the Investment Company Act of 1940 (the "Act"). MIP
has retained BGI and Stephens Inc. as co-administrators pursuant to a co-
administration agreement. Copies of MIP's agreements with all service
providers, the MIP Declaration, its By-Laws and most recent amendment to its
Registration Statement have been furnished to the Sub-administrator.

(b) MSI Trust is a registered open-end, management investment
company consisting of a number of operating investment portfolios in accordance
with MSI Trust's Declaration of Trust (the " MSI Trust Declaration"). MSI Trust
engages in the business of investing and reinvesting the assets of each Master
Portfolio in the manner and in accordance with the applicable investment
objective, policies and restrictions specified in MSI Trust's currently
effective Registration Statement, as amended from time to time, filed under the
Act. MSI Trust has retained BGI and Stephens Inc. as co-administrators pursuant
to a co-administration agreement. Copies of MSI Trust's agreements with all

1
<PAGE>

service providers, the MSI Trust Declaration, its By-Laws and most recent
amendment to its Registration Statement have been furnished to the Sub-
administrator.

(c) MasterWorks is a registered open-end, management investment
company consisting of a number of operating investment portfolios in accordance
with MasterWorks' Articles of Incorporation (the "Articles"). MasterWorks
engages in the business of investing and reinvesting the assets of each Fund in
the manner and in accordance with the applicable investment objective, policies
and restrictions specified in MasterWorks' currently effective Registration
Statement, as amended from time to time, filed under the Act and the Securities
Act of 1933. MasterWorks has retained BGI and Stephens Inc. as co-administrators
pursuant to a co-administration agreement. Copies of MasterWorks' agreements
with all service providers, MasterWorks' Articles, its By-Laws and most recent
amendment to its Registration Statement and prospectuses and statements of
additional information thereto have been furnished to the Sub-administrator.

(d) Any amendments to MIP's, MSI Trust's or MasterWorks' documents
listed above shall be furnished to the Sub-administrator promptly.

2. BGI is engaging the Sub-administrator to provide certain administrative
services specified on Appendix B hereto, subject to the supervision of BGI and
the overall supervision of the applicable Board of Trustees/Directors of MIP,
MSI Trust or MasterWorks. Pursuant to advisory contracts between MIP, MSI Trust
or MasterWorks, respectively, and Barclays Global Fund Advisors (the "Adviser")
on behalf of each Master Portfolio or Fund, as applicable, the Adviser has been
engaged to manage the investing and reinvesting of the assets of each Master
Portfolio or Fund and to provide advisory services as specified in such advisory
contracts.

3. The Sub-administrator agrees to provide the administrative services, as
described on Appendix B hereto, as such Appendix may be amended from time to
time by the consent of the parties to this Agreement, in connection with the
operations of MIP, MSI Trust and MasterWorks and the Master Portfolios and
Funds, and to take all reasonable action in the performance of its obligations
under this Agreement to assure that the necessary information is made available
to other service providers, as such may be required by BGI from time to time.

4. (a) For the services to be rendered and the facilities to be furnished
by the Sub-administrator to BGI and/or MIP, MSI Trust, or MasterWorks, BGI
agrees to compensate the Sub-administrator in accordance with the fee schedule
attached as Appendix C to this Agreement. BGI also agrees to reimburse the Sub-
administrator for its out-of-pocket disbursements connected with the services
provided hereunder and for other expenses, which, with BGI's prior written
approval, the Sub-administrator shall be entitled to bill separately. The
compensation rates to be paid to the Sub-administrator

2
<PAGE>

hereunder shall not be increased for a period of three (3) years from the
effective date of this Agreement.

(b) The Sub-administrator agrees that MIP, MSI Trust and MasterWorks
and their Master Portfolios and Funds shall have no obligation to
compensate the Sub-administrator for services provided or facilities
furnished under, or expenses incurred in connection with, this Agreement.

(c) The Sub-administrator shall have no obligation to pay for any
expenses incurred by MIP, MSI Trust and MasterWorks or their Master
Portfolios or Funds.

(d) The Sub-administrator and BGI each agree to exercise reasonable
care in performing its duties under this Agreement, and each party agrees
to be liable to the other party for direct damages resulting from a failure
to exercise reasonable care in performing such duties.

5. (a) BGI agrees to hold harmless and indemnify the Sub-administrator,
its directors, officers, employees and agents (the "Sub-administrator
Indemnitees") against and from any and all losses, expenses or liabilities
incurred by or claims or actions asserted against any Sub-administrator
Indemnitee to the extent resulting from (i) a violation or alleged
violation by BGI of any law, rule or regulation, (ii) a material violation
or alleged material violation by BGI of any provision of this Agreement,
(iii) any failure of BGI to exercise reasonable care in rendering services
hereunder, or (iv) any erroneous or incomplete information provided by or
through BGI to the Sub-administrator in connection with the Sub-
administrator's performance of its duties hereunder, such indemnification
to include any reasonable counsel fees and expenses incurred in connection
with investigating and/or defending such claims or actions.

(b) The Sub-administrator may apply to BGI at any time for instructions
and may consult counsel for BGI, or its own counsel, and with auditors and
other experts with respect to any matter arising in connection with its
duties hereunder, and the Sub-administrator shall not be liable or
accountable for any action reasonably taken or omitted by it in good faith
in accordance with such instruction, or with the opinion of such counsel,
auditors, or other experts. The Sub-administrator shall not be liable for
any action reasonably taken or omitted by it in good faith reliance upon
any document, certificate or instrument that it reasonably believes to be
genuine and to be signed or presented by the proper person(s). The Sub-
administrator shall not be held to have notice of any change of authority
of any officers, employees or agents of MIP, MSI Trust or MasterWorks or
their Master Portfolios or Funds until the Sub-administrator has

3
<PAGE>

received written notice thereof from BGI.

(c) The Sub-administrator agrees to hold harmless and indemnify BGI,
MIP, MSI Trust and MasterWorks and their Master Portfolios and Funds,
including any principals, directors or trustees, officers, and employees
(the "BGI Indemnitees") against and from any and all losses, expenses or
liabilities incurred by or claims or actions asserted against any BGI
Indemnitee to the extent resulting from a violation or alleged violation by
the Sub-administrator of any law, rule or regulation or material violation
or alleged material violation by the Sub-administrator of any provision of
this Agreement, or any failure of the Sub-administrator to exercise
reasonable care in rendering services hereunder, such indemnification to
include any reasonable counsel fees and expenses incurred in connection
with investigating of defending such claims or actions.

(d) In the event that the Sub-administrator is unable to perform, or is
delayed in performing, its obligations under the terms of this Agreement
because of acts of God, strikes, legal constraint, government actions, war,
emergency conditions, interruption of electrical power or other utilities,
equipment or transmission failure or damage reasonably beyond its control
or other causes reasonably beyond its control, the Sub-administrator shall
not be liable to BGI for any damages resulting from such failure to
perform, delay in performance, or otherwise from such causes, provided that
the Sub-administrator shall make all reasonable efforts, whenever
necessary, to use data processing back-up facilities provided by Electronic
Data Systems, Inc.

(e) In no event shall the Sub-administrator be liable for special,
incidental, or consequential damages, even if advised in advance of the
possibility of such damages.

(f) In no event shall either BGI or the Sub-administrator be liable to
the other party for actions taken or omitted or information provided that
is based upon information originally provided by such other party.

6. The term of this Agreement shall be two (2) years commencing upon the
date hereof (the "Initial Term"), unless earlier terminated as provided herein.
After the expiration of the Initial Term, this Agreement shall automatically
renew for successive one-year terms (each a "Renewal Term") unless notice of
non-renewal is delivered by the non-renewing party to the other party no later
than sixty (60) days prior to the expiration of the Initial Term or any Renewal
Term, as the case may be.

(a) Either party hereto may terminate this Agreement prior to the
expiration of the Initial Term in the event the other party violates any
material provision of this Agreement, provided that the violating party
does not cure such

4
<PAGE>

violation within ninety (90) days of receipt of written notice from the
non-violating party of such violation.

(b) BGI may terminate this Agreement prior to the expiration of the
Initial Term in the event (i) the Board of Trustees/Directors of MIP, MSI
Trust or MasterWorks determines that the performance of the Sub-
Administrator does not meet the reasonable satisfaction (considered in
light of industry standards) of the Board of Trustees/Directors, provided
that the Sub-Administrator does not cure such unsatisfactory performance
within ninety (90) days of receipt of written notice specifying such
unsatisfactory performance; or (ii) if the Sub-administrator becomes the
subject of any state or federal bankruptcy proceeding which is not
dismissed within sixty (60) days of the initiation of such proceeding.

(c) Either party may terminate this Agreement during any Renewal Term
upon sixty (60) days written notice to the other party. Any termination
pursuant to this paragraph 6(b) shall be effective upon expiration of such
sixty (60) days, provided, however, that the effective date of such
termination may be postponed, at the request of BGI, to a date not more
than ninety (90) days after delivery of the written notice in order to give
BGI an opportunity to make suitable arrangements for a successor Sub-
administrator.

(d) At any time after the termination of this Agreement, BGI may, upon
written request, have reasonable access to the records of Sub-administrator
relating to its performance of its duties as Sub-administrator.

(e) BGI may terminate this Agreement if the Co-administration
Agreement between BGI and MIP, MSI Trust or MasterWorks is terminated and
no successor agreement between BGI and MIP, MSI Trust or MasterWorks for
the provision of administrative services is subsequently executed within 90
days after the termination of the Co-administration Agreement.

(f) Section 5 hereof shall survive any termination of this Agreement.

7. (a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to BGI or the Sub-administrator shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.

To BGI: Barclays Global Investors, N.A.
45 Fremont Street, 17th Floor
San Francisco, CA 94105
Attention: Legal Group

5
<PAGE>

To the Sub-administrator: Investors Bank & Trust Company
89 South Street
Boston, MA 02111
Attention: Andrew Nesvet
With a copy to: John E. Henry, Esq.

(b) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable without the written
consent of the other party.

8. This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts.

9. BGI and the Sub-administrator agree that each party may disclose the
existence of this Agreement to third parties; provided that each agrees to keep
confidential all proprietary data, software, processes, information, and
documentation related to this Agreement, except as may be necessary to perform
obligations under this Agreement or otherwise as may be agreed to, from time to
time, in writing by the parties.

10. Neither the Sub-administrator nor any of its employees or agents are
authorized to make any representation concerning the interests of MIP, MSI
Trust, MasterWorks or their Master Portfolios or Funds without prior written
consent, except those contained in the then current Registration Statement or
applicable prospectuses and statements of additional information, copies of
which will be supplied to the Sub-administrator as described above; and the Sub-
administrator shall have no authority under this Agreement to act as agent for
MIP, MSI Trust, or MasterWorks or their Master Portfolios or Funds or for BGI,
except where necessary to perform specific services under this Agreement.

11. This Agreement may be amended only by a written instrument executed by
both BGI and the Sub-administrator.

12. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.

6
<PAGE>

If the foregoing correctly sets forth the agreement between BGI and the
Sub-administrator, please so indicate by signing and returning to BGI the
enclosed copy hereof.

Very truly yours,

BARCLAYS GLOBAL INVESTORS, N.A.,

By: /s/Donald Luskin
-------------------------------
Name: Donald Luskin
Title: Vice Chairman

By: /s/Matthew Shelton
-------------------------------
Name: Matthew Shelton
Title: Principal

ACCEPTED as of the date
set forth above:

INVESTORS BANK & TRUST

By: /s/Robert D. Mancuso
-----------------------------
Name: Robert D. Mancuso,
Title: Managing Director

By: /s/John E. Henry
-----------------------------
Name: John E. Henry,
Title: General Counsel

7
<PAGE>

Appendix A

Master Investment Portfolio
---------------------------

LifePath 2000 Master Portfolio
LifePath 2010 Master Portfolio
LifePath 2020 Master Portfolio
LifePath 2030 Master Portfolio
LifePath 2040 Master Portfolio
Asset Allocation Master Portfolio
Bond Index Master Portfolio
S & P 500 Index Master Portfolio
U.S. Treasury Allocation Master Portfolio
Money Market Master Portfolio
Extended Index Master Portfolio
U.S. Equity Index Master Portfolio

Managed Series Investment Trust
-------------------------------

Growth Stock Master Portfolio
Short-Intermediate Term Master Portfolio

MasterWorks Funds, Inc.
-----------------------

LifePath 2000 Fund
LifePath 2010 Fund
LifePath 2020 Fund
LifePath 2030 Fund
LifePath 2040 Fund
Asset Allocation Fund
Bond Index Fund
Growth Stock Fund
Money Market Fund
S&P 500 Index Fund
Short-Intermediate Term Fund
U.S. Treasury Allocation Fund

Dated: October 21, 1996

A-1
<PAGE>

Appendix B

LIST OF ADMINISTRATIVE SERVICES
-------------------------------

(1) Prepare selected portfolio and financial information for inclusion in Board
material

(2) Assist in presentation to Board as desired by Fund Officer(s);

(3) Calculate total return information and other statistical information
including undistributed income and capital gains with respect to condensed
financial information for review by management;

(4) Perform tests of specific portfolio activities against compliance
checklists designed from the provisions of the Masters' and Money Market
Fund's current Prospectus and SAI;

(5) Calculate dividend amounts available for distribution;

(6) Coordinate review of dividend amounts by management and auditors;

(7) Notify fund accounting and transfer agent of authorized dividends rates;

(8) Prepare responses to various performance questionnaires; coordinate as
necessary, and submit responses to the appropriate agency;

(9) Prepare Forms N-SAR for filing; obtain any necessary supporting documents;
file with the SEC via EDGAR;

(10) Draft semi-annual and annual shareholder reports and coordinate auditor and
management review;

(11) Coordinate printing of reports and EDGAR conversion with outside printer
and filing with the SEC via EDGAR;

(12) Provide information for Financial Highlights and expense tables;

(13) Coordinate the preparation of required reports and confirmations for audit
packages with IBT fund accounting.

(14) Assist in resolution of audit issues.

(15) Perform diversification testing pursuant to the Internal Revenue Code of
1986, as amended (the "Tax Code") -- preliminary at each month end, final
at quarter end, and as may otherwise be necessary. Follow-up on any issues
until Tax Code qualification issues are resolved.

B-1
<PAGE>

(16) Perform short-short income and qualifying income tests monthly or more
frequently, as test results dictate, with respect to qualification as a
regulated investment company under the Tax Code.

(17) Identify book-tax accounting differences with auditors and management.

(18) Track required information relating to accounting differences and determine
appropriate allocations to feeders.

(19) Follow appropriate Tax Code treatment for all passive foreign investment
company ("PFIC") lots identified by BGI.

Approved: October 21, 1996

Signed: /s/Donald Luskin Signed: /s/Robert D. Mncuso
----------------------- --------------------------
By: Donald Luskin, Vice Chairman By: Robert D. Mancuso, Managing Director
Barclays Global Investors, N.A. Investors Bank & Trust

Signed: /s/Matthew Shelton Signed: /s/John E. Henry
----------------------- ---------------------------
By: Matthew Shelton, Principal By: John E. Henry, General Counsel
Barclays Global Investors, N.A. Investors Bank & Trust

B-2
<PAGE>

Appendix C

FEE SCHEDULE
------------

CUSTODY, FUND ACCOUNTING & CALCULATION OF N.A.V.

A. Fund Accounting and Calculation of N.A.V
----------------------------------------

The following annual fee will be charged for each Master Portfolio of MIP and
MSI Trust and stand-alone Fund of MasterWorks for which IBT serves as fund
accountant. This fee does not include domestic or global custody or
transaction costs.

Annual Fee
----------
<S> <C>
Domestic Funds $25,000
International/Foreign Funds $40,000

Per Feeder Annual Charge $12,000

</TABLE>

B. Domestic Custody and Transactions**
---------------------------------

In addition to the transaction charges below, there will be a basis point
charge on all domestic assets that IBT is custodian as follows:

For all assets .67 basis point

<TABLE>
<CAPTION>
<S> <C>
Transactions Charges
- ------------ -------
. DTC $ 4
. Fed Book Entry $ 5
. Physical Securities 35
. Options and Futures 18
. GNMA Securities 40
. Principal Paydown 5
. Foreign Currency 18***
. Cross Border 50
. Outgoing Wires 7
. Incoming Wires 5

</TABLE>

C-1
<PAGE>

**Trade information will be sent to IBT electronically. If the trades are not
sent electronically, the price per trade for DTC and Fed Book items will
increase to $12 per trade.

***There are no transaction charges for F/X contracts executed by IBT.

C. Global Custody:
--------------

. Incremental basis point and transaction fees will be charged for all
foreign assets for which IBT serves as custodian. The asset based fees
and transaction fees vary by country, based upon the attached global
custody fee schedule. Local duties, script fees, registration, exchange
fees, and other market charges are out-of-pocket.

. IBT will require international assets to be held within its international
custody network.

MUTUAL FUND ADMINISTRATION

A. Mutual Fund Administration
--------------------------

. The following basis point fees are based on all assets for which IBT
serves as Administrator. This fee does not include preparation of tax
returns and provisions.

Annual Fee
----------

First $1 billion of assets $2.75 Basis Points
Assets in excess of $1 billion 1.0 Basis Point

. For any new funds beyond the existing 1 stand-alone fund, 11 master
portfolios and 11 feeder funds there will be a minimum fee as described
below.

First 6 months $10,000
Next 6 months $12,500
Each Year thereafter $35,000

This minimum fee includes 1 master portfolios and 1 feeder fund or stand-
alone fund. Each additional feeder will be charged a yearly minimum fee
of $7,500.

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<PAGE>

The minimum fees will apply until the basis point fee above exceeds the
minimum charge.

MISCELLANEOUS

A. Out-of-Pocket
-------------

. These charges consist of:

- Printing, Delivery & Postage
- Board Meeting Attendance
- Extraordinary Travel Expenses
- InvestView
- Legal Expenses
- Customized Systems Development/Reporting
- Pricing & Verification Services (Per day/issue; Bonds $.50, Stocks $.03)
- Int'l stocks and bonds $.40; Int'l corporate actions $3.00 per
month/issue.

B. Domestic Balance Credit
-----------------------

. IBT allows use of balance credit against fees (excluding out-of-pocket
charges) for fund balances arising out of the custody relationship. The
credit is based on collected balances reduced by balances required to
support the activity charges of the accounts. The monthly earnings
allowance is equal to 75% of the 90-day T-bill rate.

C. Securities Lending, Foreign Exchange & Cash Management
------------------------------------------------------

. This proposal is based upon IBT performing securities lending, foreign
exchange and cash management for the portfolios. Securities Lending
revenue is split between a master portfolio or a fund and IBT on a 60/40%
basis; 60% going to the master portfolio or fund.

D. Payment
-------

. An invoice with respect to the above fees will be sent to BGI and will be
payable within ten (10) business days after the invoice is received.

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<PAGE>

E. Systems
-------

. The details of any systems work will be determined after a thorough
business analysis. System's work will be billed on a time and material
basis.

F. Legal & Audit Expertise
-----------------------

. IBT will rely on the outside counsel to MIP, MSI Trust and MasterWorks and
auditors for opinions on any structural changes to the master portfolios
or funds.

* This fee schedule is valid for the time frames described in the
individual contracts.

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<PAGE>

- -----------------------------------------------------------------
Country BP Charge Trade Charge

- -----------------------------------------------------------------
Argentina 22.00 $ 75.00
Australia 5.00 $ 60.00
Austria 7.00 $ 60.00
Bangladesh 41.00 $150.00
Belgium 7.00 $ 60.00
Bharain 41.00 $140.00
Botswana 50.00 $175.00
Brazil** 29.00 $ 80.00
Canada 5.00 $ 30.00
Chile*** 45.00 $100.00
China 20.00 $ 75.00
Colombia** 45.00 $140.00
Cyprus 50.00 $150.00
Czech Republic 20.00 $ 75.00
Denmark 5.00 $ 60.00
Ecuador 45.00 $100.00
Egypt 41.00 $100.00
Euroclear-Eurobonds 5.00 $ 20.00
Euroclear Non-Eurobond Issues 5.00 $ 60.00
Finland 7.00 $ 70.00
France 5.00 $ 60.00
France Debt 5.00 $ 60.00
Germany 5.00 $ 30.00
Ghana 50.00 $200.00
Greece 45.00 $130.00
Hong Kong 10.00 $ 65.00
Hungary 50.00 $200.00
India**** 50.00 .50BP
Indonesia 13.00 $ 65.00
Ireland 7.00 $ 60.00
Israel 50.00 $150.00
Italy Debt 5.00 $ 50.00
Italy Equity 5.00 $ 50.00
Japan 5.00 $ 30.00
Jordan 41.00 $120.00
Kenya 50.00 $200.00
Korea 13.00 $ 65.00
Lebanon 41.00 $140.00
Luxembourg 7.00 $ 60.00
Malaysia 10.00 $ 70.00
Mauritius 41.00 $140.00

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<PAGE>

- -----------------------------------------------------------------
Country BP Charge Trade Charge

- -----------------------------------------------------------------
Mexico 10.00 $ 40.00
Morocco 40.00 $150.00
Namibia 50.00 $200.00
Netherlands 5.00 $ 40.00
New Zealand 5.00 $ 60.00
Norway 7.00 $ 90.00
Oman 41.00 $140.00
Pakistan 41.00 $140.00
Peru 50.00 $150.00
Philippines 13.00 $ 65.00
Poland 50.00 $150.00
Poland T Bills 29.00 $110.00
Portugal 20.00 $125.00
Russia Equities 41.00 $250.00
Russia Min Fins 35.00 $140.00
Singapore 10.00 $ 65.00
Slovakia 20.00 $ 75.00
South Africa 7.00 $ 40.00
Spain Eq & Corp. Debt 7.00 $ 60.00
Spain Gvt Debt 5.00 $ 60.00
Sri Lanka 13.00 $ 65.00
Swaziland 50.00 $200.00
Sweden 5.00 $ 40.00
Sweden Debt 5.00 $ 40.00
Switzerland 5.00 $ 60.00
Taiwan 13.00 $ 65.00
Thailand 10.00 $ 65.00
Turkey 41.00 $140.00
UK 5.00 $ 50.00
Uruguay 50.00 $150.00
Venezuela** 45.00 $140.00
Zambia 50.00 $200.00
Zimbabwe 50.00 $175.00

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<PAGE>

*Bonds billed at Residual Value
**Local Administrator Fees included in Custody fee
***20 BP Local Administration Charge Applied to Trades
****Trades billed at 50 BP

Out-of-Pocket Charges are passed through as actuals in all markets

Dated: October 21, 1996

C-7