The system is certainly not set up to accommodate that now but we could 
probably draft around it on a case by case basis.  It strikes me that while 
we might be able to come up with a legal framework that would allow for this, 
the credit considerations are more problematic.  I would guess that the back 
office will also be unhappy about having to manually rearrange all of the 
trades.  This really seems like it is similar to the Aquilla problem in some 
respects.  When we suggested allowing one entity to trade for another, Credit 
was quite concerned because the system wouldn't be able to check the 
appropriate headroom.  I suppose Credit could just assign the lowest headroom 
for any of the eligible entities to the entire relationship - would  that be 
acceptable to everyone?  Another possibility is for the fund to set up a 
master trading entity which does the trades with us and then does back to 
back deals with whichever entities need the allocations.  That would let them 
do a large transaction on EOL and then smaller transactions with the other 
entities.  Of course, the master trading entity would need to qualify for 
credit on its own somehow.  Guarantees from anyone other than the owner would 
be difficult (upstream guarantee problems).


   
	
	
	From:  Bob Shults                           02/03/2000 02:04 PM
	

To: Mark Taylor/HOU/ECT@ECT
cc: Louise Kitchen, Per Sekse/NY/ECT@ECT 
Subject: 

We have been talking to some of the hedge funds concerning EOL.  They want 
the ability to allocate transactions between legal entities.  They do not 
want to have different ID's and make seperate transaction for each entity 
(during which time the price could move) in order to self allocate.  Do you 
have any ideas on how we can facilitate this?