membership. The operations metrics that ISDA polls monthly from its membership and the results of ISDA’s Operations Benchmarking Survey, published annually, demonstrate that these efforts are not going unrewarded and that firms are making great strides to meet the targets set forth in the paper. These efforts can only benefit from such attention, while at the same time drawing additional encouragement and momentum. They are similarly helped by the hard work and dedication of those who give freely of their time to develop and enhance the infrastructure that enables this progress to occur. Financial products Mark-up Language (FpML), the industry messaging standard, facilitates smooth and effective transfer of all the information components that permit the post-trade process to take place. Since the standard was adopted by ISDA, it has incorporated all major derivatives products, barring commodity derivatives, which will be tackled as ISDA revises its documentation for this product set. FpML is now used by all major dealers. Its use is also gradually extending to end-users, who have been encouraged into the process by ISDA.

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aspects of financial arrangements, including collateral arrangements, involving securities held with intermediaries. As of the publication of this Retrospective, the Hague Securities Convention is not yet in effect nor has. UNIDROIT adopted a final form of draft Convention.

Another regional reform project which ISDA has supported is being spearheaded by the National Law Center for Inter-American Free Trade (NLCIFT). The NLCIFT is promoting the adoption of a treaty by the Organization of American States that will address issues raised by the creation of rights, including under financial collateral arrangements, in investment securities held through intermediaries in the Latin American, Central American and Caribbean region. This treaty would deal with the private international law and substantive law questions, in a way that is compatible with the Hague Securities Convention and UNIDROIT projects but is especially adapted to and reflective of the special concerns of the OAS member states. ISDA has encouraged OAS member states to urge that such a Treaty be put on the OAS agenda.

ISDA submitted comments on various U.K. initiatives during 2004, including the U.K. Law Commission's Consultative Report (CP No 176) on the reform of English law rules regarding the creation of company security interests. Comments were also submitted on the Financial Markets Law Committee’s project on property security interests. ISDA’s comments addressed views on its effects on financial collateral arrangements, the risk of re-characterization and the protection of set-off and close-out netting.

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In the commodities derivatives area, ISDA anticipates publication of the 2005 ISDA Commodity Definitions by June 2005. Transaction types have been expanded and physically-settled commodity transactions are covered through stand-alone annexes. A User’s Guide will also be published in June 2005.

ISDA published the GTMA Part [6] Annex, designed to accommodate physical power trades in the U.K. power markets, and the North American Gas Annex and Canadian Addendum, designed to document trades in the U.S. and Canadian physical gas markets. ISDA also published a confirmation for EU Emissions Allowance Transactions to accommodate the establishment of the Emissions Trading Scheme in the European Union. ISDA is also working on coal and freight documentation.

ISDA undertook a number of documentation projects in the credit derivatives area, including the publication of a first to default confirmation template and accompanying guidance note and a knock-out swaption confirmation template.

ISDA also published a confirmation template for use with U.S. municipal Reference Entities and a revised Sovereign Master Confirmation Agreement.

ISDA is also nearing completion of confirmation templates for credit default swaps on asset backed securities, including a cash and physical settlement template, a dealer-oriented pay-as-you-go template and a monoline-oriented pay-as-you template.

ISDA published a Credit Default Swap Matrix, a Supplement to the 2003 ISDA Credit Derivatives Definitions, in order to facilitate more streamlined confirmation

practices. With respect to equity derivatives, ISDA published an Index and Share Variance Swap Master Confirmation Agreement as well as a Japanese Interdealer Master Equity Derivatives Confirmation Agreement for Index Options and Share Options. ISDA also initiated a fund definitional annex to the 2002 ISDA Equity Derivatives Definitions.

In the foreign exchange area, ISDA published a Supplement to Annex A of the 1998 FX and Currency Option Definitions to accommodate an amendment to the Turkish Lira. For interest rate and currency derivatives, ISDA continued to publish a variety of amendments to the Annex to the 2000 ISDA Definitions. A project was also initiated in 2005 to revise the 2000 ISDA Definitions and Annex. To address the increasing usage of inflation derivatives globally, ISDA published the 2005 ISDA Inflation Definitions.

ISDA also initiated the development of a standardized give-up agreement intended to cover a variety of products, including credit derivatives, foreign exchange and interest rate swaps.

The Association continued to expand the number of jurisdictions where it obtains legal opinions on the enforceability of netting and collateral provisions of the ISDA Master Agreement, adding new collateral opinions for Italy, Mexico and the Philippines.

ISDA also published new netting opinions for Greece, India and Italy and is commissioning new netting opinions for Barbados, the Czech Republic and Iceland. A technical paper was also published on the status of netting laws in the People’s Republic of China and the Czech Republic.

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FpML Version 4.0 was released as a Recommendation in April 2004. Version 4.0 is the first major version that covers the main derivatives asset classes.

Beyond interest rate and foreign exchange derivatives, Version 4.0 covers equity options and equity swaps, as well as credit derivatives.

Recommendation is the final step in the development process of a version, it reflects consensus within the FpML community, including feedback from users implementing the version, and bears the Standards Committee stamp of approval.

On a technical level, Version 4.0 is the first schema-based version of the standard. Schemas describe a document template in XML format.

Version 4.0 also has a messaging framework, which defines the necessary information to send and receive documents.

In addition, validation rules have been developed for the products covered in Version 4.0. In 2004, work began on a minor Version 4.1, which adds additional functionality. Technically, the minor version is backward compatible, in line with the change guidelines published by the FpML standards committee.

The main additions in Version 4.1, which is currently in Trial Recommendation, are in pricing and risk, for which a new working group was formed, and in credit derivatives, with an expanded coverage for indices, baskets and credit event notices.

Version 4.1 also contains full coverage of the 2002 Equity Derivatives Definitions, the equity option and swap supplements, and equity forwards and variance swaps. Additionally, the messaging coverage has been expanded with support for Novations, Terminations and Amendments.

Version 2.0 of the FpML editor/viewer was released in July 2004. This second version of the tool, which is intended to make FpML more accessible, supports Version 4.0, including the messaging framework. It additionally provides a confirmation view in line with the ISDA sample confirmations.

Assisting firms with the implementation of FpML remains a high priority. During 2004, ISDA held its first FpML training courses in New York and London.

The course is designed to educate participants about the FpML structure, and to explore some of the asset classes, as well as the messaging, validation and customization of FpML.

ISDA will continue to hold these courses in 2005. ISDA also continued its technical FpML symposiums during the year and held its yearly FpML conference in London. The Association has also launched a survey on the use and adoption of FpML.

ISDA continued its collaboration with other standards during 2004, The FpML-FIX and ISO 20022 Working Groups remain active. Discussions have also been launched with the Data Standard Working Group on its collaboration with FpML and the integration of its work into future versions of FpML.

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In 2004, the Operations Committee and its various Working Groups continued to focus on its long-term vision and framework for standardization and automation in OTC derivatives operations. The publication of the ISDA Operations Strategic Plan in late 2003 was followed by the release of its accompanying Implementation Paper at ISDA’s 19th AGM in March 2004. The work of the Operations Committee and its Working Groups was focused though the past year on delivering against the automation targets set out in the Papers. The Implementation Paper sets forth guidelines for improving operational efficiency in OTC derivatives processing and recommends market-wide automation by 2006.

The Strategic Plan sets out target turnaround times for key processes, such as trade verification, confirmation dispatch and confirmation execution. It seeks to leverage to the greatest possible extent existing and potential technological solutions. Although there is a core group of original adherents to the Strategic Plan, the initiative is intended to be as inclusive as possible, and new adherents are being sought from all market sectors. The Process Working Group produced a number of important papers during the year. Since Standard Settlement instructions (SSIs) processing continues to present control issues for the industry, market participants drafted a paper providing data standards, and general formats for the notification, processing and verification of SSIs. An additional paper was published covering cash flow matching, netting and settlement. Common data standards were agreed upon, and it is hoped that the paper has proved useful to technology firms as they work towards building solutions in this area.

The paper envisages a tiered or modular approach allowing parties to simply and

bilaterally match cash flows prior to settlement, while still settling gross. Alternatively, bilateral net settlement is provided for, and there is interest in developing a centralized multilateral netting solution. Initial work has begun on market standards for portfolio reconciliation, which, as a process, has a 2006 target delivery date in the Strategic Plan. During 2004, an average of 15 firms contributed monthly statistics on levels of outstanding confirmations and automatching rates for the three main asset classes. The Metrics Working Group gathers and aggregates these statistics. The statistics are then circulated on an anonymous basis each month among the contributors. The annual Operations Benchmarking Survey will be published early April. At the request of ISDA Members, its format has been streamlined to focus solely on key metrics.

The Equity Operations Working Group concentrated on the introduction of automation for the equity asset class during the year, as online solutions have been made available? The Working Group is also seeking to establish an order of priority for the production of new product short form confirmations. The Rates Working Group produced a number of Supplements to the 2000 Definitions, as well as rate source and settlement matrices. This Rates Working Group will form part of a new working group that will rewrite and update the 2000 ISDA Definitions.

In 2004, the Operations Credit Derivatives working group focused on the processes to improve automation and reduce the number of outstanding confirms. The working group also focused on developing the Master Confirmations and Transaction supplements and the Credit Derivatives Physical Settlement Matrix.

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The Committee completed numerous documentation projects in the last 12 months, including: The Knock-Out Swaption Template for Corporates and Sovereigns; The First to Default Confirmation and accompanying Note, intended to document credit derivative trades with baskets or portfolios of Reference Entities; Additional Provisions for the Republic of Hungary and for the Russian Federation; The 2004 Sovereign Master Credit Derivatives Confirmation Agreement; The 2005 Monoline Supplement; and a form of Confirmation and Additional Provisions for use with U.S. Municipal Reference Entities.

The fast growing market of credit derivative indexes and the operational aspects of the credit derivatives market received increasing attention in 2004. To address the operational aspects, the Committee works in collaboration with the Operations Committee.

There has been a fair amount of regulatory interest in the operational aspects of the credit derivatives market, and ISDA received welcome comments from the Joint Forum on Credit Risk Transfer and the U.K. FSA. Both topics will stay high on the agenda for the foreseeable future.

The Committee also monitored evolutions on the tax treatment of credit default swaps in the U.S.; and followed discussions on the characterization of weather derivatives and the treatment of credit derivatives under the Basel rules. The work undertaken in 2003 on material nonpublic information for the U.S. market has been further expanded in

2004/2005 with an EU-focused companion paper. ISDA collaborated in a Joint Market Practices Forum of trade associations, representing a wide range of credit market participants, along with the International Association of Credit Portfolio Managers, the London Investment Banking Association, the Loan Market Association and The Bond Market Association.

The recommendations are intended to help ensure that material nonpublic information obtained by financial services firms in the ordinary course of their lending or other relationships with a company is not inappropriately shared with or used by other business units or personnel within the same institutions that transact in the securities and credit derivative markets.

The Statement of Principles recommends that credit market participants consider including certain key elements in their information controls, tailoring these approaches to a firm’s particular business activities.

It provides a series of special considerations based on whether a firm has chosen to organize its credit portfolio management activities on the “private side” or the “public side” of an information wall.

Market participants can use the principles and guidelines as they review and refine their own in-house policies to ensure that their business practices and compliance are at the highest level.

ISDA will consider adapting this work to the Asian market in future.

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In 2004, ISDA published a number of new documents relating to the energy and commodity markets. The North American Gas Annex and Canadian Addendum, published in November 2004, are designed to document trades involving the purchase or sale of physical gas on a spot or forward basis, or options on physical gas in the U.S. and Canadian gas markets. It permits users to bring such trades under the ISDA Master Agreement architecture and to elect to incorporate existing credit support arrangements. The Annex also allows market participants to document trades in a manner consistent with the approach taken by the North American Energy Standards Board (NAESB). ISDA also published a long-form confirmation for trades in EU Emissions Allowances. The confirmation is intended for use in privately negotiated, physically settled transactions in European Union emissions allowances. The confirmation was designed to facilitate trading under the EU Emissions Trading Scheme, which became mandatory for certain industry sectors on January 1, 2005. The long-form confirmation enables firms to utilize their ISDA Master Agreements and, later this year, the 2005 ISDA Commodity Definitions to trade EU allowances.

Additionally, ISDA published new documentation that permits the incorporation of U.K. Grid Trade Master Agreement (GTMA) terms into trades documented under an ISDA Master Agreement. The GTMA Annex is designed to document trades in the English physical power market and relates to the Grid Trade Master Agreement published by the Futures and Options Association. ISDA is also in the process of updating the existing European Gas Annex to reflect 2004 ZBT Terms.

ISDA continues its documentation drafting efforts to provide the energy and commodity trading industry with more comprehensive trading contracts. ISDA will complete its update of the 1993 ISDA Commodity Derivatives Definitions and related 2000 Supplement in May 2005. The 2005 ISDA Commodity Definitions will be structurally different from the 1993 Definitions. The mechanics of a wide range of cash-settled commodity transactions, including swaps, options, caps, floors, swaptions, knock-ins, knock-outs and Bermudan options will be addressed in the main body of the Definitions. A series of Annexes will include revised Commodity Reference Prices and a series of sub-annexes with provisions for weather derivatives and physically-settled commodities such as Bullion, European and North American Natural Gas, UK and North American Power and EU Emissions Allowances. Users of the Definitions will implement the mechanics from the main body described above, and select those commodity-specific provisions from the sub-annexes.

ISDA submitted a comment letter in February 2004 to the National Association of Insurance Commissioners ("NAIC") regarding the NAIC's draft white paper entitled, "Weather Financial Instruments (Temperature): Insurance or Capital Markets Products?" ISDA's letter recommended that the NAIC reject the draft white paper. It discussed two major points: (i) weather derivatives are not insurance because they do not require a party to have an insurable interest and do not provide loss indemnification and (ii) the weather derivatives market needs no additional regulation. The draft white paper was ultimately not published.

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ISDA published the 2004 Americas Interdealer Master Equity Derivatives Confirmation Agreement covering Index Options, Index Swaps and Index Basket Swaps, Share Options, Share Swaps and Share Basket Swaps on U.S. and Canadian underliers. The Master Confirmation, which dealers will enter into bilaterally, incorporates the 2002 ISDA Equity Definitions, is subject to the applicable ISDA Master Agreement between such dealers, includes four General Terms Confirmations (each an Annex) with agreed upon house elections, and is supplemented with a related Transaction Supplement including trade details. Dealers may also agree on a bilateral basis to subject outstanding trades to the Master Confirmation retroactively.

Future annexes to the Master Confirmation have already been developed. In August, ISDA published the Index Variance Swap Annex and the Share Variance Swap Annex to the Master Confirmation. With the publication of the Variance Annexes, dealers now have the ability to trade index and share variance swaps under the Americas Master Confirmation. This is in addition to Index Options, Index Swaps, Index Basket Swaps, Share Options, Share Swaps and Share Basket Swaps on U.S. and Canadian underliers. Additional product annexes and supplements may be developed when members believe they are warranted.

In October, ISDA published a stand-alone Index and Share Variance Swap Master Confirmation Agreement for use where parties, such as hedge funds, do not have an Americas Master Confirmation in place, but

wish to take advantage of the Master Confirmation approach for Index and Share Variance Swap transactions.

ISDA also published the 2005 Japanese Interdealer Master Equity Derivatives Confirmation Agreement in February 2005.

In the Asia-Pacific region, ISDA is working on a draft equity template for Index Option Transactions, Share Option Transactions and Share Swap Transactions on underliers in Australia, Hong Kong, India, Indonesia, Korea, Malaysia, New Zealand, Singapore, Taiwan and Thailand.

Finally, to accommodate the rapid growth in derivative transactions linked to the performance of fund interests, ISDA is drafting definitions intended to supplement the ISDA 2002 Equity Definitions for fund-linked transactions.

The proposed definitions will provide standard terms and provisions for use in documenting OTC derivative transactions linked to funds, including private funds, hedge funds, mutual funds and exchange traded funds.

The Committee worked with the North American Tax Committee and North American Accounting Committee on various issues in 2004. The Committee is currently working with the European Regulatory Committee on a response to a Consultation Paper issued by the Code Committee of the U.K. Panel on Takeovers and Mergers. The Consultation Paper relates to proposed amendments to the Takeover Code and the Substantial Acquisition Rules.

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In Europe, ISDA has been an active participant in the outstanding debate on IAS 39 and the Fair Value Option (FVO). ISDA fully supported the fair value option when it was introduced by the International Accounting Standards Board (IASB), and the Association has actively encouraged the introduction of similar provisions elsewhere, notably in North America.

ISDA continues to believe that in order to reduce volatility resulting from asymmetric accounting, adopters must be allowed to align the accounting treatment of financial transactions with the underlying business and risk management practices. ISDA has been invited to attend the IASB’s FVO public roundtables in March 2005. ISDA also provided comment on the IASB’s new proposals on Disclosures for Financial Instruments (ED-7). Concerns raised included the level of detail provided, calling into question whether the proposals were “principles-based,” the requirements to disclose at subsidiary level and the extent to which disclosures on risk were to be included in the audited financial statements. The IASB is in the process of assessing the industry’s comments before finalizing a standard. ISDA additionally provided input on three late amendments to IAS 39, including comments on cash flow hedge accounting of forecast intragroup transactions, transition and initial recognition of financial assets and financial liabilities and financial guarantee contracts and credit insurance.

ISDA hosted two events, in London and in New York, on the practical impact of IFRS. A cross-section of members from ISDA’s various committees attended to hear about the work ISDA does with the IASB

and the likely implications for the derivatives industry.

In North America, ISDA formed a joint working group to respond to FASB's proposed statement of Financial Accounting Standards, Fair Value (Exposure Draft). In a letter submitted in September (available at www.isda.org), it suggested clarifications that would enhance the usefulness of a final statement and improve its application. In addition to seeking those clarifications, the working group urged FASB to field-test the provisions of the fair value guidance before the issuance of a final statement. The board held a public roundtable discussion with constituents to discuss issues relating to the proposed statements. ISDA met with FASB staff and certain Board members to discuss the Board's projects on accounting for beneficial interests and elective fair value of financial instruments. In response to a Board member’s request for a list of financial instruments that ISDA members believe should be eligible for the fair value election, ISDA provided a response in September 2004, asking the Board to consider the following two suggestions on an accelerated basis, separately from the broader project: 1. Hybrids with embedded derivatives requiring bifurcation under current guidance. 2. Liabilities recognized as a result of “failed sales” and consolidation of variable interest entities.

ISDA nominations to both the IASB and European Financial Reporting Advisory Group Financial Instruments Working Group were accepted, with European Committee Chair, Melissa Allen (CSFB) appointed to the IASB group, and Hugh Shields (Barcap), to the EFRAG group.

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Further to the final adoption in April 2004 of the Directive on markets in financial instruments (MiFID), ISDA has been actively involved in the consultation process undertaken by The Committee of European Securities Regulators (CESR) leading to the finalization of its technical advice to the European Commission for the adoption of the level 2 measures. These measures implement the general principles of regulation provided for in the directive. Particularly intensive, in this respect, has been the effort undertaken by the ERC? in providing detailed comments on two calls for evidence on the mandates from the Commission and seven consultation papers published by CESR in the relevant period. These include issues such as admission to trading, professional client agreements, best execution and market transparency, market integrity and transaction reporting and cooperation between competent authorities.

ISDA played a significant role in the definition of financial instruments, aimed at providing a balanced regulatory answer to issues raised by physically settled commodity derivatives and non-financial non-commodity derivatives having the characteristics of other derivatives financial instruments.

Consultation papers by CESR on best execution and market transparency are still pending. In order to aid the finalization of CESR technical advice to the EU Commission, ISDA is working with the EU Institutions (Commission, European Securities Committee, national governments and regulatory authorities) involved in the process leading to the adoption of the level 2 provisions and their subsequent transposition and implementation.

In the wake of the transposition of the Market Abuse Directive (MAD), due by October 2004 but still pending in a number of jurisdictions, ISDA is contributing to CESR work at level 3 on issues aimed at bringing further clarity to market participants on a number of operational requirements with which they are meant to comply under the directive. Work is currently under way to achieve a consistent and effective application of the directive across the EU also by better defining concepts such as accepted market practices and providing examples of market manipulations in breach of the directive.

A particularly sensitive issue relates to the requirement imposed on market intermediaries to report suspicious transactions and the related surveillance responsibilities. ISDA, together with other industry associations, provided input to the consultation paper of the Financial Services Authority and HMT concerning implementation of the directive in the U.K..

In late 2004, the European Institutions, including the Parliament, the Commission and the Inter-Institutional Monitoring Group, expressed their support of the functioning of the Lamfalussy approach, its ability to meet its key objectives and its future direction.

ISDA contributed to the consultation launched by CESR on its role at level 3 and, in particular, on how to achieve greater consistency across the EU in the implementation of EU law and establish greater convergence of supervision and enforcement. ISDA was also active in another consultation launched by CESR in on the so called Himalaya report.

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Working with The Bond Market Association, ISDA continued its efforts to reform the bankruptcy and bank insolvency laws in the United States. The joint industry proposal sought to update the Bankruptcy Code to reflect market developments since the FDIA and FDICIA were last updated in 1989 and 1991, respectively, and to ensure consistency between the two statutes and the Bankruptcy Code. In addition, the development of Basel II and a new consolidated supervisory structure affecting securities firms raised financial institutions’ concerns regarding the legal certainty of netting. The industry wanted to make certain that systemic risk was mitigated by ensuring that financial intermediaries were able to exercise their rights in a timely manner. The new legislation also expanded the definition of “swap agreement” to reflect changes endorsed by the President’s Working Group in 1996 that accommodated credit derivatives, equity derivatives and weather derivatives. The industry proposed to further expand the definition of “swap agreement” to include emissions and inflation derivatives.

ISDA was also actively engaged in the review of the Commodity Exchange Act, last amended in December 2000 with the passage of the Commodity Futures Modernization Act, and the reauthorization of the Commodity Futures Trading Commission (CFTC). The CFTC’s mandate was last approved in December 2000 and must be reconsidered by the Congress every five years. ISDA Executive Director and CEO Robert Pickel testified before Congress in March 2005 to emphasize the industry’s support for reauthorization of the CFTC. ISDA also monitored the legislative proposals regarding oversight of government

sponsored entities, such as Fannie Mae and Freddie Mac. ISDA was particularly concerned that any legislation considered by Congress contemplate netting provisions applicable to these entities.

ISDA, joined by The Bond Market Association and the Securities Industry Association, responded to the proposal by the Securities and Exchange Commission, the Board of Governors of the Federal Reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation and the Office of Thrift Supervision’s proposal relating to complex structured finance transactions.

The industry comment letter focused on several key items, including the scope of the proposal, the international aspects of its scope, the possible introduction of new legal duties for financial institutions and documentation policies. In addition, the industry met with officials from the Federal Reserve Board, the Securities and Exchange Commission and the Office of the Comptroller of the Currency. To date, the U.S. Federal agencies have not revised their proposal, but it is anticipated that such a revision will occur in 2005.

On the educational front, ISDA held a documentation conference in Washington, D.C. to discuss various documentation issues as well as the fundamentals of derivatives. Acting Chairwoman Sharon Brown-Hruska gave the keynote address at ISDA’s commodities conference in New York in November 2004. ISDA also participated in meetings with Congressional and agency staff on issues affecting the derivatives industry.

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ISDA has supported regulatory initiatives aimed at enhancing the Capital Accord in the short to medium-term future. One initiative, the Trading Book Review, was launched jointly by the Basel Committee and the International Organization of Securities Commissions in early 2004 with the objective of ensuring that positions in the trading book attract amounts of regulatory capital proportionate to the risks that they create. For ISDA, this review is critical, as it will deliver a more risk sensitive treatment of counterparty credit risk arising from OTC derivatives transactions, as well as improved recognition of credit risk mitigation. ISDA has supported the Basel/IOSCO working group by producing and commissioning extensive research into future exposure measurement, with particular emphasis placed on wrong way risk, roll-over risk and actively managed short term exposures, including calibration of simple potential future exposure add-ons. ISDA’s work has been closely coordinated with other trade bodies, including the London Investment Banking Association and the Institute of International Finance. ISDA will focus on the Trading Book Review throughout 2005.

A longer-term project that will assist the Basel Committee in upgrading the Accord in due course is the convergence of economic capital measurements study, which ISDA commissioned jointly with the International Association of Credit Portfolio Managers from Rutter Associates. This study paves the way for improved regulatory recognition of portfolio diversification effects. ISDA also continued work on the implementation of the Accord, with particular emphasis on areas impacting the amount of regulatory capital charged against OTC derivatives

business. At the international level, ISDA supported the Accord Implementation Group on validation of the IRB approach, the challenges presented by low default portfolios, and our work with the joint AIG/CTF working group on “downturn LGDs.” ISDA also co-sponsors the European LGD Database initiative, now in its third operational year with eight major financial institutions contributing data and over 500 resolved observations pooled. At the European level, ISDA worked with the Commission and Her Majesty’s Treasury at refining key articles of the Capital Requirements Directive, which transposes the Accord into EU legislation. The Directive will be presented to the EU Parliament for First Reading in the fall of 2005. Looking ahead, ISDA will assist CEBS on model validation issues and the Supervisory Review Process. ISDA also continues to work with the UK FSA and participate in the Credit Risk Standing Group meetings. ISDA will contribute to a number of newly created “Expert Sub-groups” of the CRSG, including those on low default portfolios, external models, and stress testing. On the Operational Risk front, ISDA sits on the UK FSA’s Op-Risk Standing Group, which has looked at compliance with rules such as the Advanced Measurement Approach soundness standard and correlation measures. Home-host interaction, particularly for ‘significant’ subsidiaries remains a critical issue for the viability of the AMA approach.

In the US and Japan, ISDA continues to support local regulators’ Accord implementation efforts in areas of particular relevance to the membership, including credit risk mitigation and the trading book review.

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The major focus of the European Tax Committee throughout 2004 has been the impact on the tax regime of a move to new international accounting standards (IFRS). ISDA has been an active participant in the "IAS 39 Working Group" set up by the UK Inland Revenue to explore the likely effects and discuss possible changes to tax legislation. We plan to continue to support the work of this group as new issues arise as companies begin to file tax returns based on IFRS.

The Committee has also focused on changes proposed in the UK's "Green Budget" to the taxation of derivatives based on property and share values. Finally, we continue to monitor the progress of the OECD work on the taxation of permanent establishments (PEs). Recently, following comments from ISDA, and other industry bodies, the OECD decided to defer their report on PEs until further work was done.

In the US, ISDA has responded to Treasury and IRS proposed regulations regarding the appropriate method for the inclusion into income or deduction of contingent nonperiodic payments made pursuant to a notional principal contract (CNPCs) and the treatment of such inclusions or deductions.

ISDA recommends that the “wait-and-see” method best reflects the economics of CNPCs, and should be retained. As an alternative, ISDA recommends that the “wait-and-see” method be retained for (i) all CNPCs with terms of five years or less and (ii) longer-dated CNPCs with contingent payments that are indeterminable as to both timing and amount when entered into (e.g., credit default swaps). Maintaining current law for such CNPCs should cover the

overwhelming majority of CNPCs. For CNPCs with terms greater than five years (but not those with contingent payments that are indeterminable as to their timing and amount), the full allocation method should be adopted, under which all income and deductions are deferred until the contingent payment is made. Regardless of the term of the CNPC, taxpayers should be permitted to elect to mark-to-market their CNPCs.

Treasury and IRS issued Notice 2004-52 requesting information regarding credit default swaps (CDS) in connection with the consideration by the government of taxpayer requests (including an ISDA formal request) for specific guidance on the tax treatment of CDSs.

ISDA maintains that a CDS is a financial instrument and that payments made thereunder to a non-US counterparty would not be subject to withholding taxes or insurance excise taxes. While practically all tax practitioners believe there are no withholding taxes applicable to CDSs, the IRS has never provided direct guidance on the point. In light of the large size and rapid growth of the market, ISDA thought it prudent to ask the IRS for specific guidance.
ISDA has followed up with government staff on topics such as pricing, hedging and liquidity of CDS; nature of credit market participants; differences between credit default swaps and standby letters of credit and guarantees.

The American Jobs Creation Act was passed in October 2004. ISDA was instrumental in the removal of harmful language from the bill which would have repealed the qualified covered call (QCC) exception to the straddle rules of the US tax code for OTC options.

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ISDA’s Asia-Pacific Office, based in Singapore, focuses on developments in Australia, Hong Kong, India, Indonesia, Malaysia, New Zealand, People’s Republic of China, Philippines, Singapore, South Korea, Thailand and Taiwan. Last year’s key regional developments included:

In China, following the promulgation of the long awaited Provisional Administrative Rules Governing Derivatives Activities of Financial Institutions in February 2004, around 50 banks have received approval from the China Banking Regulatory Commission (CBRC) to conduct derivatives business in China. In December 2004, CBRC issued Guidelines on the Market Risk Management of Commercial Banks, which introduced some of the Basel Core Principles for Effective Banking Supervision and added more detail to the risk management concepts introduced by the new Derivatives Rules. ISDA continued its dialogue with regulators and lawmakers, in particular concerning the draft Bankruptcy Law, with a view to strengthening the legal framework relating to the enforceability of close-out netting.

In early 2005, the Securities and Futures Commission in Hong Kong issued a Consultation Paper on the Review of the Disclosure of Interests Regime under Part XV of the Securities and Futures Ordinance. ISDA provided comments seeking in particular an exemption for certain credit derivative transactions. Further dialogue on the issue is anticipated.

In India, ISDA continued to support the Reserve Bank of India’s push to implement close-out netting legislation as well as to promote legal certainly in related areas.

ISDA also made available a first legal opinion on the enforceability of the termination, bilateral close-out netting and multibranch netting provisions of the ISDA Master Agreements in India.

ISDA further released a first collateral opinion for the Philippines on the validity and enforceability of collateral arrangements under the ISDA Credit Support Documents.

ISDA has been working to ensure the enforceability of collateral arrangements in South Korea through the proposed introduction of a close-out netting provision as part of the new Insolvency Legislation in Korea. A February 2003 Supreme Court case had cast doubt on this issue.

On a pan-regional basis, ISDA’s monthly Asia-Pacific Legal & Regulatory Committee meetings in Hong Kong and Singapore served to monitor and discuss regional and regulatory developments as well as follow the work of ISDA’s global Committees.

In addition to providing input on the revised Collateral Guidelines through its Asia-Pacific Collateral Committee, ISDA’s efforts in the region continued to focus on education. Presently members are working on building a Chinese language glossary of collateral terms. ISDA’s Asia-Pacific Risk Management Committee, which serves as an informational forum for risk practitioners in the region, continued its focus on information distribution and risk management education. In 2004, together with PRMIA, ISDA organized a series of risk seminars in the region. ISDA also continues to promote the Asian ISDA-RMA Loss Given Default database with members and regulators.

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On April 7, 2004 Ontario Superintendent of Financial Institutions released a ruling that affirms the right of banks, foreign bank branches and other federally incorporated financial institutions to engage directly in physically-settled commodity trading, subject to certain requirements. The Canada Steering Committee worked with the Canadian Bankers' Association, and various ISDA members from Canada, to submit a comment letter in support of the proposed ruling.

In May 2004, the Committee submitted a comment letter to the Canadian Securities Administrators on the consultation draft of the Uniform Securities Act --The Regulation of OTC Derivatives. The proposed legislation seeks to bring OTC derivatives within the regulatory jurisdiction of securities legislation, and then provide exemptions for transactions between “qualified parties.” As a result, derivative transactions could be subject to prospectus and registration requirements unless exempted. There is no such comparable regulation in the United States and this approach could place OTC derivatives participants in certain Canadian provinces at a competitive disadvantage. ISDA’s comment letter emphasized these points.

In June 2004, ISDA published a definition of "Force Majeure Event," for use with the 2002 ISDA Master Agreement, when such Master Agreement is governed by the law of a province of Canada (other than Quebec) or where there is a likelihood of having to litigate a force majeure issue in such a province. In February 2005, ISDA published Instructions and Additional Provisions for use with a Counterparty in Quebec to provide guidance on taking a non-

possessory security interest in certain forms of collateral, when a counterparty is located in Quebec. Also in June 2004, ISDA submitted a comment letter to Industry Canada regarding issues that ISDA members believe should be addressed in the next round of Canadian insolvency law reform; most significantly the operation of automatic stays against OTC market participants during insolvency proceedings.

In February 2005, ISDA submitted an amicus brief (or intervenor factum as it is called in Canada) in the Androscoggin Energy LLC case to the Court of Appeal for Ontario. ISDA's submissions to the court concerned whether "physical" v "financial" settlement is a proper basis for determining whether a contract is an "Eligible Financial Contract" under the Companies' Creditors Arrangement Act. The decision of the court, released February 18, upheld ISDA's submissions that "physical" vs. "financial" settlement is not a proper basis for determining whether a contract is an "Eligible Financial Contract" under the Companies' Creditors Arrangement Act. The decision goes on to uphold the reasoning applied by the Alberta Court of Appeal in Blue Range.

Looking ahead, the Committee will focus on increasing its work on collateral law reform and insolvency law reform, by expanding its efforts to encourage passage of the USTA by other provinces in addition to Ontario, and by encouraging Industry Canada to look at improvements to the various bankruptcy and insolvency statutes. ISDA will also aim to expand its educational seminar program in the region, notably in the area of accounting practice and policy.

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Upon EU accession, the Czech Republic adopted ISDA-endorsed netting provisions. Since Hungary and Poland adopted netting laws in 2002 and 2003, ISDA has published netting opinions for these jurisdictions. When Greece adopted a netting provision shortly after Hungary and Poland, ISDA published a Greek netting opinion as well. It is hoped that Slovakia will finalize netting legislation by the end of 2005.

In order to obtain more uniform netting across the EU, ISDA has submitted a proposal to the European Commission suggesting the adoption of a European netting directive aimed at harmonizing the netting regimes in the EU member states and the accession countries. ISDA is particularly monitoring the status of implementation of the EU Collateral Directive in accession, candidate countries and beyond. Russia remains a top priority for ISDA. Previously, ISDA had commented on various draft bills.

ISDA has approached the new financial markets regulator and is part of a new local working group that is discussing progress in financial legislation, especially derivatives. ISDA has also submitted comments on current legislative efforts in Israel. Issues of currency re-denomination in Turkey as of January 1, 2005 have also been addressed by the Association.

The Islamic Finance Law Group is discussing fundamental legal issues of Islamic law facing the derivatives business in jurisdictions of primary concern to ISDA members in the Gulf region (UAE, Bahrain, Saudi Arabia, Kuwait, Qatar) and Southeast Asia (Malaysia). Draft proposals for Shari’a law-compliant ISDA documentation are also being discussed. ISDA has approached regulators in the Gulf region and Malaysia on their views on key concepts of ISDA documentation.

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ISDA continued its focus on risk management throughout 2004. Since its establishment in early 2004, the Japan Basel II Implementation Working Group has held proactive dialogues with Japan’s Financial Services Agency (JFSA), collaborating with the Japanese Bankers Association on the revised framework of Basel Capital Accord and the implementation plan presented by JFSA. The focus of the Working Group was on the capital treatment of credit derivatives and collateralized OTC derivatives, including some of the issues debated under Basel Committee / International Organization of Securities Commissions Trading Book Working Group. Over the course of 2004, the Japan Equity Derivatives Committee worked on the standardization of confirmation terms of inter-dealer transactions relating to Japanese shares and indices. Careful discussions lead to the publication of confirmation templates in June 2004, followed by the Master Confirmation in February 2005.

In April 2004, the Japan Credit Derivatives Committee conducted a survey on the trading volume of various transaction types. Summary results were shared at a credit derivatives conference held in July, to allow broader market participants to analyze current activities and tell the future trend. Throughout the year, the Committee’s subgroup, the Market Practice subcommittee, continued to serve as a forum to address local market issues. Discussions in 2004 included determination of Successors following the reorganization of JAL group and applicability of debt for an equity swap as a Restructuring Credit Event. In July 2004, ISDA established the Credit Derivatives Working Group as a subgroup to

the Japan Operations Committee. At its inauguration meeting, the new Working Group identified resolution of outstanding confirmations and automation of confirmation processes as its primary focus.

Another significant achievement in 2004 was the October release of Japanese guidelines to the 2002 ISDA Master Agreement. This booklet prepared by the Japan Documentation Committee was utilized as a text at the Conference held in February 2005, which was the first ISDA Documentation Conference conducted solely in Japanese.

In new products, the Japan Emission Trading Working Group finalized a proposal paper to the industry in June, which advocates the establishment of an OTC market and the importance of financial institutions to the development of an OTC emissions market in Japan. It also reveals issues that prevent the smooth development of an OTC market in the region based on legal and accounting analysis.

As a continuation of these activities, the Working Group met with Japan’s Ministry of Environment for an information exchange in November. The Japan Commodity Definitions Working Group discussed the standard language for Japan Crude Cocktail (JCC) and agreed to include them in the 2005 ISDA Commodity Definitions.

In the coming year, ISDA will continue to provide forums for members to discuss issues relating to OTC derivatives, including traditional and new products, as well as furthering dialogue with national regulators.

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Education: ISDA continued its derivatives training efforts in 2004, with its Fundamentals of Derivatives, Fundamentals of Credit Derivatives, and Operations Training seminars in New York and London. ISDA also conducted Fundamentals of Derivatives seminars in new locations in 2004, including Hong Kong, Singapore, Copenhagen, Paris, Vienna, Boston, Chicago, San Francisco, Stamford, and Washington. Credit Derivative Seminars were also held in Hong Kong and Tokyo. In the coming year, ISDA plans to offer Fundamentals of Derivatives Seminars in Johannesburg, Mumbai, Seoul and Taiwan.

New seminars are currently under development for 2005, including Fundamentals of Commodity Derivatives, to be held in London, Calgary and New York, and Fundamentals of Equity Derivatives, to be held in London and New York.

ISDA is also exploring interest in half-day seminars on specific topics such as Derivatives Documentation for Credit Managers, Pricing and Valuation and Bond Math for Derivatives.

Research: ISDA is acquiring and assembling historical data on the ISDAFIX Swap Rate Benchmark, which was established in 1998, and will make the data available at www.isda.org. The data cover swap fixed rates for six currencies: CHF, EUR (Euro Libor and Euribor), GBP, HKD, JPY, and USD (rates and spreads).

ISDA conducts its Margin Survey and Operations Benchmarking Surveys annually and its Market Survey semiannually. In

2004, the Market Survey and the Margin Survey were automated by moving the questionnaires to the Internet. In addition, the Operations Benchmarking Survey, while still conducted by means of spreadsheet distributed by email, has been simplified and shortened considerably.

Finally, the FpML Survey, which was previously a subset of Operations Benchmarking Survey questions, has been split off into a separate Internet-based survey. ISDA hopes to automate the Operations Survey in the coming year.

ISDA conducted two one-off surveys in 2004. The first was a survey of concentration of counterparty credit exposures among major dealers. Published at the AGM, the survey found that on average, a major dealer’s five largest net interdealer exposures are about two percent of its entire derivatives exposure. The second was a survey of times required to negotiate an ISDA Master Agreement. Both surveys are available at www.isda.org.

Finally, ISDA and the International Association of Credit Portfolio Managers (IACPM) are jointly sponsoring a study of the Convergence of Credit Capital Models. The objective of the study, in which 31 financial institutions are participating, is to provide data to the Basel Committee on Banking Supervision that, it is hoped, will advance the case for allowing firms to use their credit portfolio models to determine capital adequacy. A by-product of study has been to provide new insights into the functioning of the major credit capital models. Final results are expected by mid-2005.

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ISDA’s members are classified into three categories according to the guidelines contained in its by-laws. Below is a description of each category as well as some of the benefits of membership.

Primary Members – dealer firms
According to the Association's by-laws, every investment, merchant or commercial bank or other corporation, partnership or other business organization that, directly or through an affiliate, as part of its business (whether for its own account or as agent), deals in derivatives shall be eligible for election to membership in the Association as a Primary Member, provided that no person or entity participates in derivatives transactions solely for the purpose of risk hedging or asset or liability management.
Associate Members – service providers
ISDA's Associate Membership category is designed for service providers -- brokers, law firms, accounting firms, consulting firms and software providers -- who are active in the privately negotiated derivatives business. Associate Membership provides a forum for these industry participants to stay abreast of and contribute to important developments and initiatives.

Subscriber Members – end-users
ISDA's Subscriber Membership category is designed for corporations, financial institutions, government entities and others who use privately negotiated derivatives to better manage financial risks. Subscriber Membership provides a forum for these industry participants to stay abreast of and contribute to important developments and initiatives.

Only ISDA members are entitled to receive the Association's legal opinions on the

enforceability of the netting provisions of the ISDA Master Agreements. ISDA has obtained netting opinions for 44 jurisdictions.

A netting opinion for the Czech Republic has been commissioned. In addition to the netting opinions, ISDA provides members with legal opinions on the ISDA Credit Support Documents from 34 different jurisdictions. A legal opinion for Mexico has been commissioned.

Only ISDA members are able to participate in the Association's numerous Committees, Working Groups and Task Forces, which serve to address issues in the rapidly evolving derivatives market. ISDA members exclusively receive the numerous policy papers, response letters, market survey data and communications on key business issues ISDA and its consultants generate.

ISDA members receive substantial discounts when ordering copies of the Master Agreement and supporting documents published by the Association and widely used to document privately negotiated derivatives transactions. Primary Contacts at member firms receive complimentary copies of all new publications upon their release.

Only ISDA members are eligible to attend the Association's Annual General Meeting, which is the industry's preeminent forum for the discussion of developments and issues in the privately negotiated derivatives business.
In addition, a strong preference is given to enlisting speakers from ISDA member firms at the Association's numerous conferences and seminars.

Following is a list of the Association’s members. Firms shown in italics are those that have joined since January 2004.

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ABAXBANK S.p.A.
Abbey National Financial Products
ABN AMRO Bank N.V.
ABSA Bank Ltd.
Accord Energy Limited
AEP Energy Services, Inc.
Agricultural Bank of China
Allied Irish Banks, plc
American Express Company
American International Group, Inc.
AmMerchant Bank Bhd.
Aozora Bank
Assured Guaranty Corp.
Australia and New Zealand Banking Group, Limited
Banca Akros Spa
BANCA ALETTI & C. S.p.A. (Group Banco Popolare di Verona c Novara S.c.ar.I.)
Banca del Gottardo
Banca d'Intermediazione Mobiliare IMI S.p.A.
Banca Monte Dei Paschi Di Siena SpA
Banca Nazionale del Lavoro
Banca Popolare di Milano scarl
Banca Profilo, S.p.A.
Banco Bilbao Vizcaya Argentaria, S.A.
BANCO BPI, S.A.
Banco Bradesco S.A.
Banco Comercial Portugues S.A.
Banco Espanol de Credito, S.A. (BANESTO)
Banco Espirito Santo e Comercial de Lisboa, S.A.
Banco Itaú S/A
Bank Austria AG
Bank BPH S.A.
Bank Hapoalim B.M.
Bank Julius Baer & Co. Ltd.
Bank of America N.A.
Bank of Baroda
Bank of China
Bank of Ireland Global Markets
Bank of Montreal
Bank of New York
Bank of Nova Scotia
Bank Vontobel AG
Bankgesellschaft Berlin AG
Banque Degroof SA
Barclays
Bayerische Hypo-und Vereinsbank AG
Bayerische Landesbank
BNP Paribas
BP Plc
BRE BANK SA
British Energy Power and Energy Trading Limited
Caboto - Società di Intermediazione Mobiliare S.p.A.
Caixa D'Estalvis de Catalunya
Caixa Geral de Depositos, SA.
Caja de Ahorros Y Monte de Piedad de Madrid
Calyon Corporation
Capitalia Spa
Cargill Financial Services Corporation
China Construction Bank
Chinatrust Commercial Bank
Chuo Mitsui Trust & Banking Co. Ltd.
CIBC World Markets Inc.
Citic Industrial Bank
Citigroup
Commerce International Merchant Bankers Berhad
Commerzbank AG
Commonwealth Bank of Australia
Confederacion Espanola de Caja de Ahorros
ConocoPhillips
Constellation Energy Commodities Group, Inc.
Coral Energy, L.P.
Credit Industriel et Commercial (CIC)
Credit Suisse First Boston International
Daiwa Securities SMBC Co. Ltd.
Danske Bank A/S
DBS BANK LTD
DEPFA BANK plc
Deutsche Bank AG
Dexia Bank Belgium S.A.
DnB NOR Bank ASA
Dresdner Bank AG
DZ BANK AG Deutsche Zentral-Genossenschaftsbank
E.Sun Commercial Bank, Ltd.
EDF Trading Limited
EFG Eurobank S.A.
Emporiki Bank of Greece S.A.
Entergy-Koch Trading Limited
Erste Bank der Osterreichischen Sparkassen AG
F. van Lanschot Bankiers N.V.
FirstRand Bank Limited
Fortis Bank NV/SA
Generali SGR S.p.A.
Goldman Sachs & Co.
Hamburger Sparkasse
HBOS Treasury Services plc
Hess Energy Trading Company, LLC
HSBC Holdings plc
HSH Nordbank AG
Hydro-Quebec
IKB Deutsche Industriebank AG
Industrial and Commercial Bank of China

ING Bank N.V.
ING Belgium SA/NV
ING BHF Bank (Berliner Handels-und Frankfurter)
Investec Bank Limited
Irish Life & Permanent plc
IXIS Corporate and Investment Bank
J.P. Morgan Chase & Co.
Jyske Bank A/S
KBC Bank
Keybank National Association
Koch Supply & Trading, LP
Komercní banka, a.s.
Landesbank Baden-Wurttemberg
Landesbank Hessen - Thueringen Girozentrale
Landesbank Sachsen Girozentrale
Lehman Brothers
Lloyds TSB Bank plc
Louis Dreyfus Corporation
Macquarie Bank Limited
Malayan Banking BHD
Maple Bank GmbH
Mellon Bank, N.A.
Merrill Lynch & Co., Inc.
Mitsubishi Tokyo Financial Group (MTFG)
Mitsui & Co., Ltd.
Mizuho Financial Group
Morgan Stanley & Co. Inc.
Moscow Narodny Bank Limited
Natexis Banques Populaires
National Australia Bank Limited
National Bank of Canada
National Bank of Greece
Nedcor Bank Limited
NIB CAPITAL Bank N.V.
Nikko Citigroup Limited
Nikko Cordial Securities
Nomura Securities Co., Ltd.
Norddeutsche Landesbank Girozentrale
Nordea Bank Finland Plc
Norinchukin Bank
nv Nuon Energy Trade & Wholesale
Nykredit Bank A/S
OKO Osuuspankkien Keskuspankki Oyj
Osterreichische Volksbanken-Aktiengesellschaft
Oversea-Chinese Banking Corporation Limited
PNC Bank, N.A.
Prudential Global Funding LLC
PSEG Energy Resources & Trade LLC
Rabobank Nederland
Raiffeisen Zentralbank Austria AG
Refco Capital Markets, Ltd.
Resona Bank, Ltd.
Royal Bank of Canada
RWE Trading GmbH
Sal. Oppenheim jr. & Cie KGaA
Sampo Bank plc.
Samsung Securities Co., Ltd.
SANPAOLO-IMI SPA
Santander Central Hispano, S.A.
Schroders plc
Shinko Securities Co., Ltd.
Shinsei Bank, Limited
Shoko Chukin Bank
Skandinaviska Enskilda Banken
Societe Generale
St. George Bank Ltd
Standard Chartered Bank
STASCO
State Bank of India
Sumitomo Bank Capital Markets, Inc.
Sumitomo Mitsui Banking Corporation
Sumitomo Trust and Banking Co., Ltd.
Suncorp-Metway Limited
SunTrust Robinson Humphrey Capital Markets
Svenska Handelsbanken (Handelsbanken Markets)
Swedbank
Swiss Re Financial Products
Sydbank A/S
Taishin International Bank
The Bear Stearns Companies Inc.
The Royal Bank of Scotland plc
The Standard Bank of South Africa
The Toronto-Dominion Bank
Totsa Total Oil Trading S.A.
Trust Investment Bank
Turkiye Garanti Bankasi A.S.
UBS AG
UFJ Bank Limited
UFJ Trust Bank Limited
UNIBANCO - UNIAO DE BANCOS BRASILEIROS S.A.
UniCredit Banca Mobillare S.p.A.
United Bank Limited
United Overseas Bank Limited
Vattenfall A.B.
Wachovia Corporation
Wells Fargo Bank
Westdeutsche Genossenschafts-Zentralbank eG
WestLB AG
Westpac Banking Corporation
XL Capital Ltd.
Zurcher Kantonalbank

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A & L Goodbody
Abreu, Cardigos & Associados - Sociedade de Advogados
Advokatfirman Vinge KB
Akin, Gump, Strauss, Hauer & Feld LLP
Algorithmics, Inc.
Allen & Overy LLP
Allens Arthur Robinson
Alston & Bird LLP
Anderson Mori & Tomotsune
Appleby Spurling Hunter
Arendt & Medernach
Arthur Cox Solicitors
Asahi Koma Law Offices
Ashurst
Atsumi & Partners
Baker & McKenzie
Baker Botts L.L.P.
Barbosa Müssnich & Aragão
Bell Gully
Binder Grosswang Rechtsanwalte
Bingham McCutchen LLP
Blackbird Holdings, Inc.
Blake, Cassels & Graydon LLP
Bloomberg Financial Markets
BM&F - Bolsa de Mercadorias & Futuros
Borden Ladner Gervais, LLP
Brzobohaty Broz & Honsa v.o.s.
Buddle Findlay
Cadwalader, Wickersham & Taft
Cameron McKenna
Cantor Fitzgerald International
CETIP - Câmara de Custódia e Liquidação
Chadbourne and Parke LLP
Chicago Board of Trade
Chicago Mercantile Exchange Inc.
Chiomenti Studio Legale
Cleary, Gottlieb, Steen & Hamilton LLP
Clifford Chance
Clyde & Co.
Copp Clark Professional
Corrs Chambers Westgarth
Coudert Brothers LLP
Covington & Burling
Cravath, Swaine & Moore LLP
Creditex, Inc.
CreditTrade
Curtis, Mallet-Prevost, Colt & Mosle LLP
Dave & Girish & Co.
Davies Ward Phillips & Vineberg
Davis Polk & Wardwell
De Brauw Blackstone Westbroek
De Pardieu Brocas Maffei & Leygonie
Deacons
Debevoise & Plimpton LLP
Dechert LLP
Denton Wilde Sapte
Derivatives Documentation Limited
Dewey Ballantine LLP
DLA Weiss-Tessbach
DNC Law Firm
EDX London Ltd.
e-Mid S.p.A.
Ernst & Young LLP
Eurex Clearing AG
Eurex US
Euroclear
Field Fisher Waterhouse
Fitch Ratings Inc.
Framesoft AG
Fraser Milner Casgrain LLP
Freshfields Bruckhaus Deringer
Fried, Frank, Harris, Shriver and Jacobson
Garban Intercapital
Gernandt & Danielsson Advokatbyrå KB
GFI Group
Gide Loyrette Nouel
Global Electronic Markets LLC
GovPX
Harney Westwood & Riegels
Herbert Smith
Homburger
Houthoff Buruma
Hughes Hubbard & Reed
Hunton & Williams
Hwang Mok Park P.C.
IMC Financial Products
IntercontinentalExchange, Inc.
Johnson Winter & Slattery
Jones, Day, Reavis & Pogue
JunZeJun Law Offices
Juris Corp
Karatzas & Partners
Katten Muchin & Zavis Rosenman
Kelley Drye & Warren LLP
Kim & Chang
King & Spalding LLP
Kirkland & Ellis
Kirkpatrick & Lockhart Nicholson Graham LLP
KSD (Korea Securities Depository)
Landwell
Latham & Watkins
LCH.Clearnet Limited
LeBoeuf, Lamb, Greene & MacRae
Lee & Li
Lenz & Staehelin
Linklaters
Lombard Risk Systems Ltd.

London International Financial Futures and Options Exchange (LIFFE)
Lovells
Loyens & Loeff
Mallesons Stephen Jaques
Man Financial Limited
Mannheimer Swartling Advokatbyra AB
Maples and Calder
Mark-it Partners
Marval O'Farrell & Mairal
Matheson Ormsby Prentice
Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados
Mayer, Brown, Rowe & Maw LLP
McCann FitzGerald
McCarthy Tétrault LLP
McDermott Will & Emery LLP
McKee Nelson LLP
McMillan Binch
Milbank, Tweed, Hadley & McCloy
Mitsui Company
MoneyLine
Moody's Investors Service, Inc.
Morgan, Lewis & Bockius
Mori Hamada & Matsumoto
Morrison & Foerster LLP
Nagashima Ohno & Tsunematsu
NautaDutilh
Nishimura & Partners
Norton Rose
NS Solutions Corporation
Ogilvy Renault
O'Melveny & Myers LLP
Orrick, Herrington & Sutcliffe LLP
Osler, Hoskin & Harcourt
Patton Boggs LLP
Paul, Hastings, Janofsky & Walker LLP
Pekin & Bayar Law Firm
Pekin & Pekin
Peltonen, Ruokonen & Itainen Oy
Pillsbury Winthrop LLP
Pinheiro Neto - Advogados
Pinsent Masons
PLESNER SVANE GRØNBORG
Prebon Yamane USA Inc.
PricewaterhouseCoopers
QUICK/QUICK Moneyline Telerate
Rating and Investment Information, Inc.
Reed Smith LLP
Reuters
Ritch, Heather Y Mueller, S.C.
Ropes & Gray
S.W.I.F.T. sc
SCHOENHERR RECHTSANWÄLTE OEG
Schulte Roth & Zabel LLP
Scrittura, Inc.
Seward & Kissel LLP
Shearman & Sterling LLP
Shearn Delamore & Co.
Sidley Austin Brown & Wood LLP
Simmons & Simmons
Simpson Thacher & Bartlett
SJ Berwin
Skadden, Arps, Slate, Meagher & Flom
Slaughter and May
Squire, Sanders & Dempsey L.L.P.
Standard & Poor's
Stikeman Elliott LLP
STOXX Limited
Stroock & Stroock & Lavan LLP
Sullivan & Cromwell
Summit Systems Inc.
SunGard Data Systems Inc.
Sutherland, Asbill & Brennan LLP
Swapsdata Limited
SwapsWire Limited
Taylor Wessing
Thacher Proffitt & Wood
The Depository Trust & Clearing Company
Thomson TradeWeb LLC
Thunderhead Ltd.
Torys LLP
Tradition (North America), Inc.
Travers Smith Braithwaite
TriOptima
Troutman Sanders, LLP
Tullett Liberty Inc.
Ughi e Nunziante
Uria & Menendez
Vinson and Elkins L.L.P.
VISCHER LLC Attorneys at law
VOB-Service GmbH
Watson, Farley & Williams
Weil Gotshal & Manges
White & Case LLP
Willkie, Farr & Gallagher LLP
Wilmer Cutler Pickering Hale and Dorr LLP
Wistrand Advokatbyrå
Wolf Theiss & Partners, Attorney at Law
Wong Partnership
Woo, Yun, Kang, Jeong & Han
Wragge & Co.
YIGAL ARNON & CO.

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Aareal Bank AG
AB Spintab (publ)
AB Svensk Exportkredit
ABB Capital B.V.
ACA Risk Structures, L.L.C.
AEGON NV
African Development Bank
AGF Assurances
Alexandra Investment Management, LLC
Allgemeine HypothekenBank Rheinboden AG
Amaranth Advisors L.L.C.
Ambac Financial Group, Inc.
American Honda Finance Corporation
Asian Development Bank
Australian Office of Financial Management
Austrian Federal Financing Agency (AFFA)
Aventis
AXA Bank Belgium
AXA Investment Managers
B. Metzler seel Sohn & Co. KGaA
Banco de Portugal
Bank for International Settlements
Bank Nederlandse Gemeenten, nv
Bank of Canada
Bank of England
Bank of Lithuania
Bankinter, S.A.
Banque et Caisse d'Epargne de l'Etat, Luxembourg
BBT Fund L.P.
BlackRock Financial Management
BlueBay Asset Management Limited
Britannia Building Society
Business Development Bank of Canada
Caisse Centrale Desjardins
Caisse Centrale Du Credit Immobilier de France
Caisse de depot et Placement du Quebec
Cambridge Place Investment Management LLP
Canada Mortgage and Housing Corporation
Capital Group International, Inc.
Capital One Bank (Europe) PLC
CapitalGest S.g.R. S.p.A.
Carlson Capital, L.P.
CDC IXIS Asset Management
Cheyne Capital Management Ltd
China Development Bank
Citadel Investment Group, L.L.C.
Council of Europe Development Bank
DekaBank Deutsche Girozentrale
Depfa Deutsche Pfandbrief Bank AG
Deutsche Postbank AG
DKR Capital Inc.
Dow Chemical Company
Dunbar Bank Plc
Dutch State Treasury Agency
E.ON UK plc
EADS NV
ED&F Man Treasury Management Inc.
Edison Trading S.p.A.
Egg Banking plc
Eksportfinans ASA
Electricite de France
ENDESA
Enel SPA
ENIFIN S.p.A.
Eskom
EUROFIMA
European Bank for Reconstruction & Development
European Investment Bank
Export Credits Guarantee Department
Export Development Canada
Federal Home Loan Bank of Atlanta
Federal Home Loan Bank of Boston
Federal Home Loan Bank of Chicago
Federal Home Loan Bank of Cincinnati
Federal Home Loan Bank of Dallas
Federal Home Loan Bank of Des Moines
Federal Home Loan Bank of Indianapolis
Federal Home Loan Bank of New York
Federal Home Loan Bank of Pittsburgh
Federal Home Loan Bank of San Francisco
Federal Home Loan Bank of Seattle
Federal Home Loan Bank of Topeka
Federal Home Loan Mortgage Corporation (Freddie Mac)
Federal National Mortgage Association (Fannie Mae)
Ferrell North America, a division of Ferrellgas L.P.
Fidelity Investments Money Management, Inc.
Florida State Board of Administration
FMC Corporation
Fonds de Réserve pour les Retraites
Ford Motor Credit Company
Friesland Bank N.V.
General Electric Capital Corporation
General Re Financial Products Corp.
Glencore International AG
Government Debt Management Agency Ltd. (Hungary)
Government of Canada, Department of Finance
Government of Singapore Investment Corporation Pte Ltd
Harbert Management Corporation
Harvard Management Company, Inc.
HBK Investments L.P.
IBM Corporation
IF P&C INSURANCE LTD (publ)
Instituto de Credito Oficial
Instituto de Gestao de Credito Publico
Intel Corporation
Inter-American Development Bank
International Finance Corporation
Int'l Bank for Reconstruction (World Bank)
J. R. Simplot Company
JWM Partners, LLC

Kangqi Oil Trading Ltd
KfW
Kingdom of Belgium
Kingdom of Denmark
Kingdom of Sweden
Kommunalbanken AS
Kommunalkredit Austria AG
KommuneKredit
Kommuninvest i Sverige AB (publ)
Landesbank Saar
Landeskreditbank Baden-Wuerttemberg - Foerderbank
Landwirtschaftliche Rentenbank
Laurentian Bank of Canada
M & G Investment Management Limited
M. Safra & Co., Inc.
MBIA Insurance Corp
McDonald's Corporation
Mitsubishi Corporation
Mitsui Sumitomo Insurance Company Limited
MKP Capital Management, LLC
Moore Capital Management LLC
Munich American Capital Markets
Municipality Finance Plc
N M Rothschild & Sons Ltd.
Natexis Metals Limited
National Bank of Hungary
National Bank of Poland
National Rural Utilities Cooperative Finance Corporation
National Swedish Pension Fund
Nationwide Building Society
New South Wales Treasury Corporation
New Zealand Debt Management Office
Nexen Inc.
Nexgen Financial Holdings Limited ("NFHL")
NIPPON KOA Insurance Company Limited
Nordic Investment Bank
Norges Bank
Northern Trust
NRW.BANK
Ontario Financing Authority
Ontario Power Generation Inc.
Ontario Teachers' Pension Plan Board
Øresundsbro Konsortiet
Pacific Investment Management Company LLC
Pacific Life Insurance Company
Paloma Partners Management Company
Petrus Securities, L.P.
Pfizer Inc.
PGGM
Portland General Electric
Primus Asset Management, Inc.
ProLiance Energy LLC
Province of British Columbia
Québec
Queensland Investment Corporation
Queensland Treasury Corporation
QVT Financial LP
Radian Asset Assurance Inc.
RenaissanceRe Holdings Ltd.
Renault SAS
Republic of Finland
Reserve Bank of New Zealand
Ritchie Capital Management LLC
S.A.C. Capital Advisors, LLC
Sanlam Capital Markets Limited
Scion Capital, LLC
ScottishPower Energy Management Limited
Shell Pensioenfonds Beheer B.V.
Shinkin Central Bank
Siemens Aktiengesellschaft
Sigma Finance Corporation
SNCB Holding
SNS Bank N.V.
Sompo Japan Insurance Inc.
Soros Fund Management LLC
Sound Capital Management, Inc.
South African Reserve Bank
Stadtsparkasse Koeln
Standard Life Investments Limited
Stark Investments
Statoil asa
Stichting Pensioenfonds ABP
Student Loan Marketing Association (Sallie Mae)
Suez-Tractebel S.A.
Sumitomo Corporation
Sun Life Assurance Company of Canada
Susquehanna Financial Products
Sveriges Riksbank
Swedish Housing Finance Corp.
Swiss National Bank
Telecom Italia SpA
Telkom SA Limited
Tewksbury Capital Management Ltd.
The Export-Import Bank of China
The Scoular Company
Total Capital S.A.
Toyota Financial Services
TransCanada Pipelines Limited
Transnet Limited
Treasury Corporation of VictoriaU.S. Bancorp
Union Bank of California, N.A.
Vitol SA
Vodafone Group Plc
Volvo Treasury AB
Webster Bank
Western Australian Treasury Corporation
Yorkshire Building Society

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