This excerpt taken from the BSC 10-K filed Feb 13, 2006.
We are exposed to risks resulting from non-performance by counterparties, customers, borrowers or debt security issuers. The Company is exposed to credit risk in its role as trading counterparty to dealers and customers, as direct lender, as holder of securities and as member of exchanges and clearing organizations. We are exposed to the risk that third parties that owe us money, securities or other assets will not perform their obligations. These parties may default on their obligations to us due to bankruptcy, lack of liquidity, operational failure or other reasons. The policies and procedures we use to manage credit risk are set forth under the caption Risk Management Credit Risk in the Annual Report, which is incorporated herein by reference to Exhibit No. 13 of this report. There can be no assurances that these policies and procedures will effectively mitigate our exposure to credit risk.