Exhibit (g)1.16

                        AMENDMENT TO CUSTODIAN CONTRACT

     This Amendment to Custodian Contract is made as of July 2, 2001 by and
between Frank Russell Investment Company (the "Fund") and State Street Bank and
Trust Company (the "Custodian").  Capitalized terms used in this Amendment
without definition shall have the respective meanings given to such terms in the
Custodian Contract referred to below.

     WHEREAS, the Fund and the Custodian entered into a Custodian Contract dated
as of October 31, 1988 (as amended, modified or supplemented and in effect from
time to time, the "Contract"); and

     WHEREAS, the Fund and the Custodian desire to amend certain provisions of
the Contract relating to the delivery of assets of each of the Portfolios in
connection with the lending of such assets.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter contained, the parties hereby agree to amend the
Contract, pursuant to the terms thereof, as follows:

     I.   Section 2.2 is amended by adding the following at the end therefore
          before the period:

          "; and

          15) For delivery in connection with any loans of securities made by
          the Portfolio, but only against receipt of adequate collateral as
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          agreed upon from time to time by the Custodian and the Fund on behalf
          of the Portfolio, which may be in the form of cash or obligations
          issued by the United States government, its agencies or
          instrumentalities, except that in connection with any loans for which
          the Custodian is instructed to make delivery without receipt of such
          collateral or for which collateral is to be credited to the
          Custodian's account in the book-entry system authorized by the U.S.
          Department of Treasury, the Custodian will not be held liable or
          responsible for the delivery of such securities owned by the Portfolio
          without or prior to the receipt of such collateral if it receives
          Proper Instructions to do so".

     II.  Except as specifically superseded or modified herein, the terms and
          provisions of the Contract shall continue to apply with full force and
          effect.  In the event of any conflict between the terms of the
          Contract prior to this Amendment and this Amendment, the terms of this
          Amendment shall prevail.


IN WITNESS WHEREOF, each of the parties has caused this Amendment to be executed
in its name and behalf by its duly authorized representative as of the date
first above written.


Witnessed By:                 STATE STREET BANK AND TRUST COMPANY


/s/ Nelson H. Graves          By:   /s/ Joseph L. Hooley
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                                 Joseph L. Hooley, Executive Vice President


Witnessed By:                 FRANK RUSSELL INVESTMENT COMPANY


/s/ Mary Killgrove
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Name:                         By: /s/ Mark Swanson
Title:                           -------------------------------------------
                                 Name:
                                 Title: