In response to my email of September 24 regarding the 2001 ISDA Master
Agreement Protocol, I received responses from only seven (7) institutions.
No clear indication resulted from those seven responses (four in favor of
proceeding with the Protocol; three in favor of working on a new Master
Agreement with no Protocol).  Before ISDA proceeds in either direction, it
would be helpful to have wider market input.  I should point out that ISDA
intends to work on a new 2002 or 2003 Master Agreement; timing is the only
issue - whether the process begins imminently or nine months from now.

The benefits of proceeding with the Protocol is that it takes advantage of
the considerable time and effort that has been invested in the initiative to
date.  While the rate of adherence may be diminished somewhat given the
continuing skepticism over certain annexes, the Protocol remains a
convenient and effective way for institutions to amend their Master
Agreements.  It also provides ISDA with some indication of the level of
market interest in going forward with drafting a new Master Agreement and
what provisions may be problematic.

On the other hand, dissension has been expressed with respect to some of the
Protocol's annexes, namely, the expansion of the Default under Specified
Transactions, the involuntary insolvency provisions and the Replacement
Value concept.  In addition, there has been skepticism regarding the
appropriateness of proceeding with the Protocol when the rate of adherence
may not necessarily generate a new, widely-accepted standard for market
practice.  To a lesser degree, those firms that amend their Master
Agreements via the Protocol may encounter certain issues when the new Master
Agreement is ultimately produced.

If you have not already contacted me with your response,  I would be
grateful if you could let me know your institution's position as soon as
possible.

Thank you in advance.

Kimberly Summe
General Counsel
tel: 212-332-1203