Fixed Income

Your clients should carefully consider a fund’s investment goals, risks, charges and expenses before investing. They should carefully read the prospectus before they invest or send money. To obtain a prospectus, which contains this and other information please call Franklin Templeton Sales and Marketing Services at 1-800/223-2141.

Three World-Class Investment Groups One World-Class Organization F R A N K L I N T E M P L E T O N I N V E S T M E N T S G L O B A L FRANKLIN TEMPLETON MUTUAL SERIES

Do Your Clients Have All the Right Pieces for a Well-Diversified Portfolio? U.S. Equities Foreign Equities U.S. Equities U.S. Bonds Foreign Equities U.S. Equities U.S. Bonds U.S. Equities Foreign Equities Foreign Bonds? G L O B A L

Foreign Markets Provide Opportunity 10-Year Period Ended December 31, 2007 1 ,[object Object],[object Object],37.35% Australia 2003 40.90% Norway 2002 30.38% Poland 2001 13.48% United States 2000 15.53% Japan 1999 21.25% France 1998 2007 2006 2005 2004 Year 23.83% Canada 17.96% Poland Unhedged USD Return Country 35.96% Poland 21.29% Mexico G L O B A L

Historically Low Correlation of Returns ,[object Object],10-Year Period Ended June 30, 2008 1 1.00 Global Bonds Global Bond Correlations -0.11 U.S. Stocks 0.62 U.S. Bonds -0.03 Global Stocks G L O B A L

T E M P L E T O N G L O B A L B O N D F U N D

Agenda ,[object Object],[object Object],[object Object],G L O B A L

Templeton Global Bond Fund Investment Strategy ,[object Object],[object Object],[object Object],[object Object],[object Object],Portfolio Construction G L O B A L T H E S T R A T E G Y

Franklin Templeton Fixed Income Group ® Global Presence 1 ,[object Object],SAN MATEO NEW YORK SÃO PAULO LONDON MUMBAI SEOUL SHANGHAI Franklin Templeton Fixed Income Group Offices Local Asset Management Offices DUBAI G L O B A L T H E S T R A T E G Y

Not Driven by Benchmarks… Templeton Global Bond Fund Geographic Deviation from Benchmark Index ,[object Object],As of June 30, 2008 1 G L O B A L T H E S T R A T E G Y

Professional and Dynamic Asset Allocation Country Allocations Change as Opportunities Arise ,[object Object],As of June 30, 2008 1 12.2% 3.0% 5.9% 2.9% 9.8% 0.2% 4.4% 9.9% 0.2% 0.0% 4.6% 0.0% 1.4% June 2008 4.8% 5.3% 0.0% Indonesia 2007 2003 2000 Country 1.7% 0.0% 0.7% Argentina 0.0% 2.1% 9.6% Italy 0.0% 6.5% 8.5% France 0.4% 0.0% 10.9% United States 22.7% 8.0% 3.3% Cash 3.7% 0.0% 0.0% Poland 11.3% 4.9% 2.3% South Korea 0.2% 7.7% 2.6% New Zealand 5.6% 0.0% 3.2% Brazil 12.7% 8.2% 5.0% Sweden 3.2% 1.6% 6.4% Canada 0.0% 2.7% 7.6% Spain G L O B A L T H E B E N E F I T S

Templeton Global Bond Fund Portfolio Highlights, as of June 30, 2008 1 ,[object Object],[object Object],[object Object],6.93% 12-Month Yield at NAV 4.57% 3 Distribution Rate 6.50 Years Average Weighted Maturity 3.97 Years 2 Average Duration 119 Positions Diversification AA- Average Credit Quality $10.6 Billion Assets G L O B A L T H E B E N E F I T S

Templeton Global Bond Fund–Class A The Strategy in Action ,[object Object],Portfolio Breakdown, as of June 30, 2008 1 G L O B A L T H E B E N E F I T S

A History of Positive Returns in Years That the U.S. Stock Market Declined 1 Templeton Global Bond Fund–Class A vs. S&P 500 Index (Without 4.25% Sales Charge) ,[object Object],[object Object],1987 – 2007 G L O B A L T H E B E N E F I T S

Quality Fund Management 1 ,[object Object],Michael Hasenstab, Ph.D. Vice President Co-Director / Portfolio Manager Franklin Advisers, Inc. G L O B A L T H E B E N E F I T S

Templeton Global Bond Fund–Class A Fund Performance ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],As of June 30, 2008 Top 6% 5.41% 6.54% 8.12% 10-Year N/A N/A 7.67% 8.00% Since Inception Top 4% Top 3% Top 66% Lipper Percentile Ranking 5.03% 4.13% 6.83% Lipper Global Income Funds Classification Average 3 6.39% 6.24% 17.00% Citigroup World Government Bond Index 2 8.59% 8.71% 6.57% Templeton Global Bond Fund 1 5-Year 3-Year 1-Year Average Annual Total Returns (Without Sales Charge) 30-Day Standardized Yield: 4.43% 5 7.65% 10-Year 7.79% Since Inception 7.65% 7.14% 2.00% Templeton Global Bond Fund 1, 4 5-Year 3-Year 1-Year (With Maximum 4.25% Sales Charge) G L O B A L T H E R E S U L T S

The Value of Active Management Strong Performance Over the Long Term ,[object Object],[object Object],[object Object],20-Year Period Ended June 30, 2008 Without Sales Charges Templeton Global Bond Fund–Class A Citigroup World Government Bond Index 1 Lipper Global Income Funds Classification Average 2 G L O B A L T H E R E S U L T S

Returns Matter, But So Does Volatility Risk vs. Return Comparison (Without Sales Charges) ,[object Object],[object Object],[object Object],[object Object],[object Object],20-Year Period Ended June 30, 2008 G L O B A L T H E R E S U L T S

Impressive Industry Accolades ,[object Object],As of June 30, 2008 ,[object Object],[object Object],[object Object],G L O B A L T H E R E S U L T S CLASSIFICATION: Mixed-Asset Target Allocation Moderate NUMBER OF FUNDS: 649 CLASSIFICATION: Multi-Cap Core NUMBER OF FUNDS: 664 Overall Morningstar Rating™ 1

Review ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],G L O B A L

The Next Steps ,[object Object],[object Object],[object Object],[object Object],[object Object],Diversify for a World of Opportunity 406 XINV FI B G L O B A L

A Strategic Combination Growth of a $100,000 Investment (Without Sales Charges) ,[object Object],[object Object],[object Object],January 1, 2000–June 30, 2008 1, 2 G L O B A L 40% Citigroup World Government Bond Index / 60% MSCI World Index MSCI World Index $117,703 $143,271 $228,476 40% Templeton Global Bond Fund–Class A / 60% Mutual Discovery Fund–Class A

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