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GS FINANCIAL PRODUCTS U.S. COUNTERPARTY RISK RATED 'AAA' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, June 30 /PRNewswire/ -- GS Financial Products U.S. L.P. (FPUS) counterparty risk is rated 'AAA' by Fitch. The rating is based on the high credit quality of FPUS's counterparties, strict operating guidelines, conservative risk management, and a strong capital base relative to risk.
 FPUS is a limited purpose bankruptcy remote subsidiary of Goldman Sachs Group, LP, established to intermediate, as principal, derivative transactions as a highly rated counterparty. The derivative product focus is primarily interest rate and currency related, which includes swaps, forwards, caps and floors. The company also intends to transact in select commodities markets, but at a later date. In 1992, Goldman Sachs capitalized FPUS by contributing $100 million with which FPUS purchased a portfolio of mostly interest rate and currency swaps with a market value of $105 million. The remaining $5 million investment was financed by liabilities issued to a Goldman Sachs affiliate. All partnership interests in FPUS are owned by subsidiaries of Goldman Sachs Group. However, Goldman Sachs, whose medium-term notes are rated 'AA' by Fitch, is not liable for FPUS' obligations. FPUS' general partner has $10 million of capital which is available to FPUS' creditors.
 FPUS adopted the general operating guidelines and risk model of Goldman Sachs's other derivative product limited purpose subsidiary, GS Financial Products International (FPI). As such, FPUS manages its portfolio prudently to eliminate market risk so that absent counterparty defaults, market fluctuations will not adversely impact cash flow. This is achieved by offsetting each transaction with a contract having opposite cash flow characteristics. Also, FPUS limits counterparty credit risk by engaging in transactions with only highly rated counterparties. Currently, the lowest rated counterparty in the portfolio is rated 'A'.
 The extent to which FPUS can grow its portfolio is largely dictated by a complex company-developed risk model consistent with the operating guidelines. The model measures FPUS's ability to absorb default losses and is based on counterparty credit quality, portfolio diversification, liquidity, and market risk. Cash flow is evaluated under a variety of market scenarios over the portfolio's life. The level of credit enhancement is determined by the portfolio characteristics, which include increased credit enhancement for lower rated counterparties, less diversified portfolios, and longer-term contracts. FPUS's exposure to Goldman Sachs and its affiliates cannot exceed the lower of 15 percent of FPUS's assets or the amount allowable for similarly rated counterparties under current operating guidelines.
 Also, FPUS is the general partner of FPI and thus, would be obligated for all FPI's liabilities if FPI were insolvent. However, Fitch does not anticipate FPUS would incur any loses as FPI is currently rated 'AAA' by Fitch. Additionally, the company would be restricted in expanding its portfolio unless it passed the operating tests on a stand- alone basis, and on a consolidated basis if FPI was relying on its credit enhancement. Currently, FPUS has total capital of approximately $104 million, supporting current counterparty receivables of $101 million. Together, FPUS and FPI have total capital, including the $10 million of capital from FPUS' general partner, of $216 million, supporting current counterparty receivables of $547 million. Fitch evaluated the capital tests on a stand-alone and consolidated basis and believes FPUS is well capitalized.
 -0- 6/30/93
 /CONTACT: Teri L. Seelig, 212-908-0638, or Stephen W. Joynt, 212-908-0530, both of Fitch/


CO: GS Financial Products U.S. L.P. ST: IN: FIN SU: RTG

SM -- NY037 -- 7135 06/30/93 11:52 EDT
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Date:Jun 30, 1993
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