I worked it out like this - Level1 assets - 550 Leve2A - 250. But the restriction on Level 2A assets is - max (40% of level1) so that restricts the level 2A assets to 550*0.4=220.

Total eligible assets = 770

Outflow = 1100

Inflow = 450 (Which is less than 75% of the outlflow so the entire inflow can be included)

Net outflow = 650

LCR = 650/770= 84.41~85% which was one of the options which i chose.

My take on the haircut - The HQLA should be net of haircut which is taken from the repo markets to which the bank can pledge the asset and raise the liquidity.

My take on minimum LCR - Sure BASEL III says that it should be minimum 100% but the question asked to calculate the LCR for this particular entity and not about the basic minimum requirement.

Can anybody help out with this reasoning?? Where did I go wrong? Everybody here seems to agree that the answer was either 73% or 123%

I rechecked even restriction on assets level 2 on HQLA (<40%) and cash inflow to cash outflow (<75%), LCR =123% anyway.