NOTE 1--ORGANIZATION AND BUSINESS:
The MainStay Funds (the "Trust") was organized on January 9, 1986 as a Massachusetts business trust. The Trust is registered under
the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end management investment company and is
comprised of twenty-three funds (collectively referred to as the "Funds"). These financial statements and notes relate only to
MainStay International Bond Fund (the "Fund").
The Fund currently offers three classes of shares. Class A shares, whose distribution commenced on January 3, 1995, are offered at
net asset value per share plus an initial sales charge. No sales charge applies on investments of $1 million or more (and certain other
qualified purchases) in Class A shares, but a contingent deferred sales charge is imposed on certain redemptions of such shares
within one year of the date of purchase. Class B shares and Class C shares are offered without an initial sales charge, although a
declining contingent deferred sales charge may be imposed on redemptions made within six years of purchase of Class B shares and
within one year of purchase of Class C shares. Distribution of Class B shares and Class C shares commenced on September 13,
1994 and September 1, 1998, respectively. Class A shares, Class B shares and Class C shares bear the same voting (except for
issues that relate solely to one class), dividend, liquidation and other rights and conditions except that the Class B shares and Class
C shares are subject to higher distribution fee rates. Each class of shares bears distribution and/or service fee payments under a
distribution plan pursuant to Rule 12b-1 under the 1940 Act.
The Fund's investment objective is to seek to provide competitive overall return commensurate with an acceptable level of risk by
investing primarily in a portfolio of non-U.S. (primarily government) debt securities.
There are certain risks involved in investing in foreign securities that are in addition to the usual risks of investing in U.S. issuers.