The Bank of England (BOE) has warned that Brexit still poses "material risks" to financial systems in both the U.K. and EU.
A statement released Friday has summarized conclusions from the bank's most recent meeting of its Financial Policy Committee (FPC), a body designed to spot any potential disruption to the U.K.'s financial stability.
The FPC noted that "material risks remain, particularly in areas where actions would be needed by both the U.K. and EU authorities."
The BOE said such areas included the processing of outstanding cross-border contracts. It identified uncleared derivative contracts between Britain and European Union (EU) parties with a notional value of £26 trillion ($36 trillion). A further £70 trillion of cleared contracts is seen as a particular risk to the EU.
"Cleared" trades are trades that take place on an exchange while "uncleared" trades take place between two counterparties directly. A derivative is a security with a price that is dependent upon, or derived from, one or more underlying assets.