Q1) Bad debt of banks can be lessened if preventive measures are in place, especially through the identification of when red flags start to appear.

- What do you think are the danger signs that a lender may latch on to when monitoring through internal records and visits to the borrowers premises? Mention and analyze in detail at least 5. (7.5 marks)

- What are the areas of remedial action in the borrowers business that a lender should examine? (5 marks)