The development of the now legendary ratings-sensitive coupon payment in potentially tricky bond sales has taken yet another twist as British Airways (BA), the UK quoted airline, prepares to use a new version of the model on its forthcoming bond issue.

The British Airways bond, BA's first foray into the debt markets for more than 10 years, will pay an extra 25 basis points in the form of coupon payments if either Moody's or Standard & Poor's downgrades the borrower's credit rating. This is the first time a bond deal for an airline has contained language of this sort.