Basel Framework: LCR40.79 FAQ2 -> LCR40.80

FAQ2 under LCR40.79 attributes the 0% inflow for firm shorts to LCR40.80, which only sets outflow rates; the inflow rate is in the LCR40.79 table.

Consequence

Position: Firm short covered by reverse repo of 100 Level 2B RMBS maturing in 10 days. Reading a: Following FAQ -> LCR40.80 -> no inflow rate stated; reading only 40.80 gives no inflow figure (undefined). Reading b: Table in LCR40.79 -> 0% inflow -> 0; without short cover 25 -> 25. Difference: 25 (or undefined)

Proposed correction

Clarify or correct the cited passage so that the rule and its references give one result for the stated case.

Issued by

Basel Committee on Banking Supervision

Act

Basel Framework LCR40 (in force 2019-12-15, published 2023-03-30)

Place

LCR40.79 FAQ2 -> LCR40.80

Record

Discrepancy

Class

Text of the act

Where it arose

The text of the act

Arxo's conclusion

Confirmed

Official text

Unchanged at last check

Last checked

2026-10-31

Evidence

Contradiction within the text. Quotations are verbatim from the official material; translations are ours and marked.

For firm shorts, LCR40.80 applies a 0% cash inflow rate to the reverse repo, irrespective of the residual maturity

If, however, the bank’s short position is being covered by a collateralised securities financing transaction, the bank must assume the short position will be maintained throughout the 30-day period and receive a 0% outflow.

How to check it without Arxo's tools

1. Open Basel Framework LCR40 (in force 2019-12-15, published 2023-03-30) and find LCR40.79 FAQ2 -> LCR40.80. Compare the text with the quotation above. A copy is kept in this register: 44c6353c1aad8b74-LCR40@2019-12-15~2023-03-30.txt (SHA-256 44c6353c1aad8b74e46059cb902093f993fbc36eb0190b1d17015639add29d56, copy of the official file).
2. The finding holds if the quoted passages read as shown and the comparison gives the result stated at the top of this page. If it does not, write to us with the record ID.

How this finding was made

AI models read the texts, built the examples and reviewed the findings.

Responsible institutions

• Basel Committee on Banking Supervision — maintains the Basel Framework

Reported to

Responses

No response recorded.

History

1. 2026-10-31Confirmed by Arxo
2. 2026-10-31Entered in the register
3. 2026-10-31Reported to Basel Committee on Banking Supervision (e-mail)

Cite this record

Arxo Law, Arxo Findings Register, ARXO-2026-0381, https://arxo.io/findings/ARXO-2026-0381/ (status as of 2026-10-31). Data: ARXO-2026-0381.json.