MARKET TALK: BA's Positive Pension News Bodes Well For BT -RBS

25th Jun 2010 07:30

0630 GMT [Dow Jones] The positive response by the pension regulator to British Airways (BAY.LN) earlier this week "could bode well for the ongoing review of BT's (BT.A.LN) agreement", Royal Bank of Scotland says. "There seem to be few certainties in actuarial science and we know BT's pension funding remains a material uncertainty for investors. But we believe the next six months could see a steady stream of news that supports our view that BT's agreement with the trustees is prudent and that the valuation of GBP7.5b we have in our SotP (sum of the parts) is reasonable," RBS says. Broker sees about 25% upside from the current price and believe the market is over-discounting BT's pension funding position. RBS has a buy rating on BT and 170p target price. ([email protected]) Contact us in London. +44-20-7842-9464 [email protected] (END) Dow Jones Newswires June 25, 2010 02:30 ET (06:30 GMT)