Source: Preparatory Survey Team Figure 3-8 Settlement liquidity for RTGS/LSF mode (D) Operating hours Operating hours for LSF processing is the same as for other FI transactions. During the MLOS processing time, LSF transactions will be held at GW because the calculation and settlement process of MLOS will lock all queued payment instructions. When the closing time for LSF processing comes, all queued payment instructions are automatically cancelled. (E) Settlement flow When participant FIs send payment instructions with LSF, CBM-NET Phase 2 processes a trial run of bilateral offsetting. First, BLOS searches the adverse queued payment instructions from the creditor’s queue in order and attempts simultaneous settlement of a combination of two payment instructions. If the RTGS a/c balances of both the debtor and the creditor will become positive, the two payment instructions are settled all together. If the RTGS a/c balance will become negative, BLOS continues to search for other adverse queued payment instructions. If there are no adverse queued payment instructions 35