British Airways offloads £4.4 bn in pension liabilities

British Airways has secured a deal with Legal & General that will see the airline offloading £4.4 billion of pension fund liabilities. The bulk annuity deal is designed to cover 60% of the airline's Airways Pension Scheme (APS) fund. Chair of the Board of Trustees for the fund Virginia Holmes said, "Today’s announcement is the culmination of much hard work undertaken over several months and we are pleased to be taking this step in the scheme’s de-risking journey." 

APS is the latest in a number of large pension schemes that have entered into bulk annuity deals with financial service firms in order to help reduce risks to their funds. Other recent transactions include EMI, Boots, Littlewoods, National Grid, M&S and WPP.  

According to Clark, Lane and Peacock, the total of transfer deals undertaken on the first half of 2018 was worth £7.8 billion. The latest deal means Legal & General now has the largest portfolio of pension transfers on its books of any FTSE listed company, at £5.3 billion.