1. a) Explain what is meant by credit appraisal? How does credit appraisal fop businesses differ from retail clients? (4 marks) b)Briefly explain the various loan pricing models a bank can adopt to price its loans once the decision for granting loans has been agreed. (3 marks. c)Explain briefly 4 factors that affect the promised return on a loan (4 marks) d)Ahemba Bank Ghana (ABG) Ltd is a newly licensed bank in Ghana. ABG charges 1% origination fees, 2.0% margin on loans with maturity above 3yrs. The bank requires all corporate clients to leave a compensating balance of 10% of the loan amount granted in a non-interest bearing current account The reference benchmark for pricing the bank's loans is the Ghana Reference Rate (GRR). A corporate client by name E5 limited is seeking to borrow GHS 20m for 5yrs on 31st August 2022 i) Calculate the Ghana Reference Rate and the return on this loan ii) The Bank's credit risk department has determined that the bank has 1.0% default rate, what is the expected return for ABG Limited in (i)? (3 marks) iii) Do you think the use of GRR as a pricing benchmark for loans in Ghana can lead to reduction in lending rates in Ghana? (3 marks) . Assume current 91 day rate is 29.91%, Interbank Rate is 22.06% and the Monetary Policy Rate is 22.0%. Cash Reserve Requirement is 13% and Cash in Vault (CIV) is 2%