Physical hazards caused by climate change are a result of various factors, including weather events and longer-term climate changes. Although the exact timing and frequency of extreme weather events are not yet clear, their effects on the economy are expected to be more severe in the coming years, including lower Gdp growth, higher unemployment, and significant changes in asset prices and profitability. Additionally, damage to the properties and operations of borrowers could impair asset values and creditworthiness, leading to increased default rates, delinquencies, write-offs, and impairment charges in the Barcages' resilience.