Richard A. Monaghan
                      President

                      Putnam Retail Management LP
                      One Post Office Square
                      Boston, Massachusetts 02109

October 2004

Dear Investment Colleague:

As part of our ongoing efforts to clarify and refine Putnam's product
line, we have proposed - and the Trustees of the Putnam funds have
approved - a merger plan intended to combine two similar closed-end
funds into a single larger fund. Because the combined fund will have a
larger asset base, we anticipate that your clients will benefit from
lower expenses. The merger will also give us the opportunity to focus
investment resources on a more select number of funds with the goal of
delivering consistent, dependable, superior performance over time,
although there can be no assurance that the funds will meet this objective.

Putnam High Income Opportunities Trust, which seeks high income through
investments in convertible securities and high-yield bonds, has been
proposed for merger into Putnam High Income Bond Fund, which has
substantially the same objective and strategy. Both funds are managed by
the Large cap Value and Core Fixed-Income High Yield teams, with David
L. King serving as the Portfolio Leader and George Maris and Robert
Salvin as Portfolio Members.

Your clients who are shareholders in each of these funds will be asked
to vote on the proposed merger. A prospectus/proxy statement, containing
more information about the merger, will be mailed to your clients in
November. The completion of the merger is subject to significant
conditions, including SEC review and shareholder approval, so there is a
possibility that the merger may not be completed if these conditions are
not met. If approved, the merger would occur in early 2005.

We hope you will encourage your clients to vote their proxies. The
following key points should help you respond to any questions they may
have.

* No fund objectives or strategies will change as a result of the merger.

* The merger will not result in a taxable event for clients who remain
  invested throughout the merger process. However, any sales made before
  the merger will be a taxable event that will be reflected on the
  client's Form 1099.

* A client's overall tax basis in his or her shares will not be affected
  by the proposed merger; however, for shareholders of Putnam High Income
  Opportunities Trust, the number of shares held after the merger will be
  different because that fund's shares will be exchanged for shares in the
  surviving fund with the same aggregate net asset value.

* In keeping with standard industry practice, the calculations used to
  determine the precise value of clients' holdings at the time of the
  merger will be based on the net asset value per share (NAV) carried out
  to six decimal places, not on the market price used when shares are
  bought and sold on stock exchanges. Consequently, any calculations you
  or your clients may make in anticipation of the new account value are
  likely to differ from the value noted on the post-merger confirmation.

* No predictions can be made concerning the effect of the mergers on the
  market values of the funds, either prior to completion or with regard to
  the market value of the surviving funds. In recent years, shares of each
  of the funds have traded at a discount to net asset value. Although a
  fund's market price generally reflects investment results, it may also
  be influenced by several other factors, including changes in investor
  perceptions of the fund or of Putnam, market conditions, fluctuations in
  supply and demand for the fund's shares, and changes in fund
  distributions.

* Clients who hold share certificates will need to return them to Putnam
  Investments so that they can be reissued with the new fund name.
  Pre-merger certificates cannot be sold after the merger. They should be
  sent by overnight or certified mail so that there is tracking capability
  as there will be a cost to replace any lost certificates.

If you have additional questions about the merger, please call Putnam
Dealer Marketing Services at 1-800-354-4000. Thank you for your
continued support of Putnam Investments.

Sincerely,

/s/ Rich Monaghan

Note: The foregoing is not an offer to sell, nor a solicitation of an
offer to buy shares of any fund, nor is it a solicitation of a proxy. To
receive a free copy of the prospectus/proxy statement relating to a
proposed merger (which contains important information about fees,
expenses, and risk considerations) after a registration statement has
been filed with the SEC and becomes effective, please call
1-800-255-1581. The prospectus/proxy statement will also be available
without charge on the SEC's Web site (www.sec.gov). Read the
prospectus/proxy statement carefully before making any investment
decisions.