here is where I got confused (hence that question): You say...

here is where I got confused (hence that question): You say CIMBS gave substantial holder notice in March (8%). However, because the new additional 2mil (and likewise lending to CS) is below the 5% threshold (not 1%), they were not required to give a notice. That can only be true, if they already given away their initial 8%. In that case, they must have given a notice of ceasing to be a substantial holder. Did they give a notice?

I think your theory can still work. For that, CIMBS must still be a substantial holder (some or part of that original 8%). But they should buy and then immediately lend additional purchases to CS in small batches just before it hits the 1% increase threshold (not 5%). I notice that this is done in 758K batches on different dates. Could this be reason?