The Bank of England has warned a no-deal Brexit would trigger a financial crisis in theUnited Kingdom, causing the pound to plunge by 25 percent.

The UK's central bank on Wednesday said in a report that such a scenario could mean a gross domestic product (GDP) shortfall of 8 percent in the first quarter of 2019.

The bank said a smoother Brexit for Britain could help mitigate much of the economic effect from the country's decision in June 2016 to leave the European Union.

The bank's warning came shortly after the British government said the countrywill be poorer after leaving the EUthan if it had stayed in, no matter what sort of trade deal it enters with the bloc.

A government report released earlier on Wednesday estimated that 15 years after Brexit, the UK's GDP will be 0.6 percent lower, even if it enters into a trade deal with the EU.

A no-deal Brexit, on the other hand, would render the GDP 9.3 percent smaller than it would otherwise be in the same period, the report added.

British Finance Minister Philip Hammond said the departure deal agreed on Sunday between Britain and the EU was the optimum way to minimise the cost of leaving the bloc.

Hammond insisted that the economy was not the only consideration and controlling Britain's borders, money and laws also had value.

"There will be a cost to leaving the EU because there will be impediments to our trade. What the prime minister's deal does is absolutely minimise these costs," he told BBC radio. (Aljazeera)