1sciroccofahrer,
I've had my 1995 850 for 8 years and have had this same exact problem the entire time. A friend of mine had a 1996 850 and his did the exact same thing. The point is (anecdotal evidence only) this seems to be a very common issue.
Back to my 850, I've already replaced the antenna mast unit because it broke - that didn't fix the FM radio. The radio unit in the car is also from an S70 (upgraded by previous owner) and evidently that doesn't do any better than a stock 850 radio.
I've never tried anything to fix it specifically, but knowing what I know, it seems like a lost cause.
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David 1995 854 Sedan, Naturally Aspirated, 146k mi No modifications.
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