Monday 22 February 2021 9:52 am

British Airways boosted by £2.4bn loan and pensions deal as travel restrictions keep flights grounded

British Airways has boosted its cash reserves with a £2bn loan agreement and by deferring certain pension payments, while the airline if buffeted by travel restrictions and lockdown.

British Airways owners IAG said the airline will begin drawing down a £2bn loan from a sydicate of banks and partially guaranteed by UK Export Finance.

The airline will also defer monthly pension contributions of £37.5m owed from October 2020 to September 2021, letting it keep hold of £450m.

It only impacts payments to the New Airways Pension Scheme (NAPS), which closed to new members back in 2003.

The scheme was in £2.4bn deficit as valued in March 2018 and BA had an annual plan to plug the gap. It has so far topped it up by £1.34bn.

British Airways-owner IAG rose 1.4 per cent to 168p per share shortly after the London market opened this morning.