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IAG International Airlines Group has confirmed two financing agreements that its British Airways (BA, London Heathrow) subsidiary reached that will increase total liquidity by GBP2.45 billion (USD3.43 billion), including a deal to defer GBP450 million (USD631 million) worth of pension payments and finalising a GBP2 billion (USD2.8 billion) loan.

To secure the deferral of the pension deficit contributions, which had been due between October 2020 and September 2021, it was agreed that “no dividends will be paid by British Airways to IAG before the end of 2023,” the group said in a BA financing update on February 22.

The flag carrier will start to will draw down on the five-year loan, which Britain has partially guaranteed through its UK Export Finance agency, by the end of this month. The facility was secured on December 31, 2020, and includes restrictions on BA making dividend payments to the parent company, the statement said.

“In addition to these arrangements, IAG continues to explore other debt initiatives to improve further its liquidity,” said the group, which also owns...

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