WASHINGTON -- While entering into interest-rate swap transactions can be a useful debt and asset management tool, the risks involved can hurt an issuer's creditworthiness, Standard & Poor's Corp. told municipal issuers yesterday.

"We're not saying municipal issuers should not use derivatives. We are saying they should be very careful about how they structure them," said G. Kris Rao, a director in the rating agency's municipal finance area.

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