Tomorrow, Vanguard's Europe Pacific ETF will start trading on the American Stock Exchange. The expense ratio will be 15 basis points for the new offering. The Europe Pacific ETF seeks to track the performance of the MSCI EAFE Index, a benchmark of stocks from 21 developed foreign countries.

Vanguard is continuing to lower costs for exchange-traded fund (ETF) investors with the introduction of Vanguard� Europe Pacific ETF (ticker symbol, VEA), which begins trading tomorrow morning on the American Stock Exchange. With an expense ratio of 0.15% and 1,134 holdings, the new Vanguard ETF(TM) is the most broadly diversified, lowest-cost ETF available today that seeks to track the widely followed MSCI EAFE Index.*

�Vanguard has long been recognized as a low-cost leader among mutual fund investors, and we�re bringing that same cost advantage to ETF investors,� said Vanguard Chief Investment Officer Gus Sauter. Vanguard�s ETF cash flow is up nearly 40% in 2007, and the firm�s ETF assets have roughly doubled over the past year to $31 billion. Vanguard attributes this strong growth to the company�s considerable cost advantage. The average expense ratio of Vanguard ETFsTM is 0.18%, less than half the industry average of 0.41% (Source: Lipper Inc.).

Vanguard Europe Pacific ETF rounds out Vanguard�s broad-market ETFs, which cover the domestic equity and bond markets, as well as developed and emerging international markets.

Vanguard Europe Pacific ETF seeks to track the performance of the MSCI EAFE Index, a benchmark of stocks from 21 developed foreign countries. The new offering is a share class of the Vanguard Tax-Managed International Fund, which was introduced in 1999 and has $2.3 billion in total net assets.

Vanguard�s family of ETFs now includes 33 stock and bond offerings. The firm has introduced six ETFs in 2007, including four bond index ETFs with class-leading expense ratios of 0.11%. Vanguard recently filed a registration statement with the SEC for Vanguard Extended Duration Treasury Index Fund, which will offer an ETF share class and is expected to launch later this year. The firm has also filed for exemptive relief to offer four active bond ETFs. These ETFs will be share classes of the following funds:

� Vanguard Inflation-Protected Securities Fund
� Vanguard Short-Term Treasury Fund
� Vanguard Intermediate-Term Treasury Fund
� Vanguard Long-Term Treasury Fund.

MSCI Barra (www.msicbarra.com) develops and maintains equity, hedge fund and REIT indices that serve as benchmarks for an estimated USD 3 trillion on a worldwide basis. MSCI Barra�s risk models and analytics products help the world�s largest investors analyze, measure and manage portfolio and firm-wide investment risk. MSCI Barra is headquartered in New York, with research and commercial offices around the world. Morgan Stanley, a global financial services firm and a market leader in securities, asset management, and credit services, is the majority shareholder of MSCI Barra, and Capital Group International, Inc. is the minority shareholder.

The Vanguard Group, headquartered in Valley Forge, Pennsylvania, is one of the nation�s largest mutual fund firms and a leading provider of company-sponsored retirement plan services. Vanguard manages more than $1.2 trillion in U.S. mutual fund assets, including more than $325 billion in employer-sponsored retirement plans. Vanguard offers more than 140 funds to U.S. investors and more than 40 additional funds in foreign markets.

Edited by: Erin Kello

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