The agency said the banking industry's weaknesses, including a lack of liquidity, thin capital buffers and ailing asset quality, have been exacerbated while the departure of senior central bank officials could delay ongoing structural reforms.

Funding risks and weaker profitability will likely test the sector's credit strength

Bangladesh, India, Pakistan and Sri Lanka’s exposure to wildfires, floods, major storms and also water shortages mean South Asia has 10-18% of GDP at risk – roughly triple that of North America and 10 times more than the least-affected region, Europe.