many financial institutions engage daily in thousands of transactions with other financial institutions directly and through clearing organizations;

the efficient processing of such transactions is essential to a smoothly functioning economy;

such transactions can be processed most efficiently if, consistent with applicable contractual terms, obligations among financial institutions are netted;

such netting procedures would reduce the systemic risk within the banking system and financial markets; and

the effectiveness of such netting procedures can be assured only if they are recognized as valid and legally binding in the event of the closing of a financial institution participating in the netting procedures.