Halister News

(Bloomberg) -- Volkswagen AG won final approval of $1.225 billion settlement of lawsuits filed by drivers of premium Audis, VWs and Porsches over the company’s diesel-cheating scandal.

• U.S. District Judge Charles Breyer in San Francisco Wednesday signed off on the accord, which requires VW to compensate owners of 3-liter diesel engine vehicles, fix about 58,000 cars and buy back as many as 20,000 Touareg and Audi Q7 sport-utility vehicles.
• VW admitted in September 2015 that about 11 million diesel cars worldwide were outfitted with so-called defeat devices, embedded algorithms used to game emissions tests
• The Federal Trade Commission will monitor VW’s compliance with the settlement. The automaker agreed last month in a separate case to pay a $4.3 billion penalty for misleading U.S. regulators and customers

The case is In Re: Volkswagen “Clean Diesel” Marketing, Sales Practices and Products Liability Litigation, 15-02672, U.S. District Court, Northern District of California (San Francisco).

(Bloomberg) -- Economists at some of the largest banks are cutting their projections for Brazil’s benchmark interest rate. As data show activity still slacking and inflation under control, some of the main forecasters now see the so-called Selic rate finishing the year near or even below its historical low of 7.25%.

• BNP Paribas on Wednesday cut its forecast for Selic this year to 7%, from a previous 8%, citing falling inflation, less fiscal expansion, contractionary credit and progress in pension reform
• Fibra and Safra made similar moves recently, with Safra expecting rate to reach 7% in 1H18
• Itau, Brazil’s largest bank by market value, also trimmed its forecast for the benchmark rate this week and now estimates it will reach 7.5% in October, remaining at that level until the end of 2018; Bank of America also said Selic will reach 7.5% this year
• Bradesco, Brazil’s second largest private bank, cut its projection for the rate in 2017 to 8%, from 8.5%
• Many analysts condition lower rates to approval of pension reform; However, for Tony Volpon, UBS Brazil chief economist and former BCB director, policy makers shouldn’t base rate decisions on pension reform approval schedule 
  • UBS hasn’t yet changed its call for a 100bps rate cut in next BCB meeting, but Volpon says there’s a chance for a 125bps reduction
• Isabela Guarino, an economist at XP Gestao de Recursos, also predicts the rate at 7.5% at the end of the cycle, but says ; At some point in 2019, however, she expects the BCB to raise interest rates again as level not sustainable in the long run
• Future interest contracts show market now pricing in cut of 125bps in next Central Bank meeting, scheduled for May 30-31
  • So- called DI swap contracts show market expects Selic to be at 8.25% at the end of the year

--With assistance from Ana Carolina Siedschlag and Julia Leite. To contact the translator on this story: Julia Leite in Sao Paulo at jleite3@bloomberg.net Reporters on the original story: Josue Leonel in Sao Paulo at jleonel@bloomberg.net; Patricia Lara in Sao Paulo at plara6@bloomberg.net Editors responsible for the original story: Daniela Milanese at dmilanese@bloomberg.net Ney Hayashi

(Bloomberg) -- Kraft Heinz said to have lined up tens of billions in financing from banks to help buy Colgate-Palmolive, StreetInsider said, citing source familiar.

• Deal could value Colgate-Palmolive at as much as $90b
• CL rises as much as 7.4% after report
• Kraft Heinz declined to comment to StreetInsider; Colgate- Palmolive didn’t respond to request for comment
• NOTE: Yday, Colgate CEO Said to Be Open to Sale at $100/Share: New York Post

(Bloomberg) -- The treasury at Venezuela’s state oil company PDVSA has dispatched funds for a $135 million coupon payment for its 2026 bonds that was due on Monday, a company official, who is not authorized to speak about the matter publicly, said. 

• PDVSA is telling investors to check their bank account statements, the person said.
• Payment process issues were responsible for delay, the person said.

--With assistance from Christine Jenkins. To contact the reporter on this story: Jose Enrique Arrioja in New York at jarrioja@bloomberg.net

--RONALD DAY