It is a similar kind of lending loop to that which went on during the late 1990's leading up to the 2000 crash. A lends to B lends to C lends to A.

There is a famous quote from the polish economist Kalecki, that "economics is the science of mistaking a stock for a flow". Essentially this form of lending continues while everybody can make interest payments, and blows up horribly as soon as somebody can´t - as I have no doubt all those concerned are fully aware.