BT’s LSE stock price dived in early trading today after the Pensions Regulator expressed “substantial concerns” over its pension liabilities.
BT’s Pension Scheme liabilities increased by £9.4billion (€10.7b) in the nine months to December 31, leading to a net shortfall of £6.8 billion, or 20% of its total assets.
Announcing its quarterly result Thursday, BT said the higher liability was a result of lower bond yields and expectations of a rise in inflation.
The UK telco had also revealed, that it had reached agreement with the pension scheme trustee over valuation of the fund.
It said that the UK Pensions Regulator had not yet the opportunity to review the agreement in detail, but that its “initial view is that they have substantial concerns with certain features.”
“BT and the Trustee will continue to work with the Pensions Regulator to help them complete their detailed review,” BT said.
Following the news BT’s stock price was off 6.48% as it fell from 129.7p to 121.00p in early trading. It later recovered to 123.10p.