External Meetings: Meeting with Riverside Risk Advisors

The meeting was a general discussion of how the major swap participant (MSP) definition will apply to various types of financial swaps, and the impact of collateral requirements on the swaps.  Riverside asserted that standardization of the credit relationship between dealers and end-users  will impede customization of swaps.  In particular, it will discourage major banks’ use of swaps to transfer financial risks to other parties.  Riverside said that the end-user exception from clearing should be available for such swaps, because the collateralization required for clearing would make such swaps not economically viable.