British Airways is poised to an-nounce Eagle Star as the partner in its much-trumpeted financial services division.
The division’s products will carry joint branding and will be sold to the public, not just to British Airways Executive Club members. Product details are not yet known but are likely to include household, motor, life insurance and, later, pensions.
The airline has already unveiled details of a credit card, jointly branded with the NatWest name. But the card is available to BA Executive Club members only. It also markets a Personal Equity Plan (PEP), which allows investors to invest in its own shares.
BA has been negotiating with various financial service partners for at least a year. It is understood that Abbey National was involved in talks but pulled out.
Neither BA nor Eagle Star will comment on the deal.
One source says: “It seems strange that the airline is doing it with just Eagle Star and not Allied Dunbar as all the rumours had been about Allied Dunbar.
“It does not seem to fit in terms of branding, as Eagle Star has a more downmarket image.”
However, BA marketing director Martin George has denied rumours that he is attempting to set up a bank. He says this would be too far removed from the core business of running an airline.
The Department of Trade & Industry says it does not expect to make any decision on British Airways’ planned alliance with American Airlines until after the general election on May 1.