Core Insights - The article highlights the increasing regulatory scrutiny on personal business loans (operating loans) that have been misused in the real estate market, revealing a growing risk as these loans approach their maturity phase [1][6]. Regulatory Focus - Local financial regulatory bodies have issued fines to several banks for misappropriating loan funds, with penalties ranging from 550,000 to 1,150,000 yuan for various infractions, including issuing loans to public officials and inadequate credit management [2][3]. - The misuse of operating loans has been prevalent, particularly among local banks and city commercial banks, with interest rates for these loans being significantly lower than those for housing loans, leading to relaxed scrutiny by banks [2][5]. Risk of Misuse - A complete "arbitrage industry chain" has emerged around the misuse of operating loans, involving the creation of fake business entities, falsification of transactions, and ultimately redirecting funds to the real estate market [4][5]. - The period from 2020 to 2023 saw a surge in these practices, with some loans having interest rates as low as 2%, which attracted significant capital into the housing market [5]. Concentrated Maturity Risk - 2025 is identified as a critical year for the maturity of operating loans issued between 2020 and 2023, with many borrowers facing financial strain due to declining property valuations [7]. - Borrowers are increasingly resorting to "bridge financing" to avoid defaults, leading to escalating costs due to intermediary fees and interest [7]. Rising Default Rates - The default rates on operating loans are climbing, with some banks reporting rates above the average for all loans, indicating a growing risk exposure for financial institutions [7]. - The complexity of fund flows and the difficulty in monitoring them have made traditional post-loan management ineffective [7]. Regulatory Response - In response to these risks, regulatory authorities are promoting "substantive penetration" management, which includes banning partnerships with loan intermediaries and implementing technology to track loan flows [8]. - The focus is on ensuring that genuine business operators can access loans while preventing misuse, emphasizing the need for precise monitoring rather than blanket restrictions [8].