Norfolk Southern CEO fired over relationship with general counsel

STUDENT LOANS

Navient is no longer allowed to service federal student loans and must pay $120 million

Navient Corp. will be barred from servicing federal student loans and must pay $120 million under a proposed settlement with the Consumer Financial Protection Bureau. The CFPB said an investigation into the company found it pushed student loan borrowers into more expensive repayment options and denied them access to cheaper income-driven repayment plans. Under the order filed by the agency, Navient must pay a $20 million penalty and $100 million to harmed student borrowers. Navient said in a statement that the settlement puts decades-old problems behind it. The company is no longer a purchaser or servicer of federal student loans after transferring its contract to service federal student loans to a third party in 2021, it said. Earlier this year, it agreed to outsource servicing of some legacy student loan portfolios, which began on July 1. Navient is a repeat offender, according to the CFPB. In 2022, the company reached a $1.85 billion settlement with 39 states and agreed to cancel about 66,000 student loans to resolve allegations that the company engaged in loan usury practices. — Bloomberg

Mortgages

Interest rates continue to fall

The average interest rate on a 30-year mortgage in the U.S. fell to its lowest in 19 months this week, reflecting a decline in Treasury yields ahead of an expected rate cut by the Federal Reserve next week. The rate fell to 6.20 percent from 6.35 percent last week, mortgage buyer Freddie Mac said Thursday. A year ago, the average rate was 7.18 percent. The average rate is now the lowest since Feb. 12, 2023, when it was 6.12 percent. — Associated Press

International

ECB cuts key interest rates again

FRANKFURT, Germany — The European Central Bank cut interest rates for the second time in three months on Thursday, continuing a slow unwinding of aggressive policies the bank has used to combat high inflation in the euro zone. Central bank officials, who set interest rates for the 20 eurozone countries, cut the deposit rate by a quarter of a percentage point to 3.5 percent, from 3.75 percent. Inflation has eased and the central bank is under pressure to help the region's ailing economy: Growth has been weak for more than a year, partly because of weak fiscal spending and high interest rates that are holding back investment. — New York Times

AUTOMOBILE

Stellantis stops production of electric Fiats due to lack of orders

Stellantis will stop production of the electric Fiat 500 model in Turin, Italy, next month due to a lack of orders from Europe. The European market for electric vehicles is “in big trouble,” the carmaker's Italian subsidiary said on Thursday. The European auto industry is facing a sharp downturn and Stellantis is considering job cuts in Italy due to falling sales. Rival Volkswagen is considering plant closures in Germany for the first time in its history, while France's Renault has warned that automakers could be fined if they fail to meet the European Union's ambitious climate targets. — Bloomberg

AUTOMOBILE

GM and Hyundai consider cooperation

General Motors and Hyundai will explore possible collaboration to develop vehicles, improve supply chains and advance clean energy technologies. The automakers said Thursday they would seek to cut costs and offer customers a wider range of vehicles more quickly. In addition to potential partnerships to produce passenger and commercial vehicles, including internal combustion engines and electric and hydrogen technologies, the companies will explore opportunities for joint sourcing of battery raw materials, steel and other areas. — Associated Press

EAT

General Mills sells North American yogurt business

General Mills has agreed to sell its North American yogurt business, which includes the popular Yoplait brand, for $2.1 billion in cash. The company will sell its U.S. and Canadian operations to French dairy companies Groupe Lactalis and Sodiaal, respectively, according to a statement Thursday, confirming an earlier report by Bloomberg News. Increased competition from companies such as Danone and Chobani in the U.S., as well as limited market penetration, led to discussions about exiting the country's yogurt market, Bloomberg Intelligence analysts Jennifer Bartashus and Jibril Lawal wrote in a note in May. General Mills is also refocusing its portfolio on growth segments such as premium pet food and organic snacks, they said. — Bloomberg

HEALTH INSURANCE

Major health insurance company takes action against Ozempic prescriptions

A major U.S. insurer is taking an unusually tough approach to doctors it says have incorrectly prescribed the diabetes drug Ozempic, escalating the ongoing war over drugs that have become extremely popular for weight loss. Anthem Blue Cross Blue Shield demanded money from health care providers, claiming they falsified patients' medical records so that the insurer had to cover the cost of the drugs. In some cases, the amount demanded was more than $1 million, according to documents seen by Bloomberg. The providers dispute Anthem's claims and say they properly prescribed the shots. — Bloomberg

FAST FOOD

McDonald's sticks to the $5 menu offer

McDonald's summer deal becomes a fall event The chain will extend a $5 meal deal introduced in June into December in most U.S. markets, it said in a statement Thursday. The move shows how much fast-food chains are competing for price-conscious diners. McDonald's is also trying to counter the perception that its prices have become too high after competitors introduced value-priced menu items months before McDonald's. — Bloomberg

GAMES

Microsoft cuts 650 jobs in Xbox division

Microsoft has announced it will cut 650 jobs at its Xbox division, the third such layoff this year as the company tries to cut costs and integrate its massive $69 billion acquisition of Activision Blizzard Inc. The jobs to be cut are “primarily corporate and support functions,” Xbox chief Phil Spencer said in a memo sent to employees Thursday. “As part of these adjustments, no games, devices or experiences will be canceled today and no studios will be closed.” Xbox employees had braced for more layoffs after Microsoft cut 1,900 jobs in January, many of them at Activision divisions and studios. In May, the company announced the closure of four studios acquired as part of its $7.5 billion acquisition of ZeniMax — one of which was ultimately sold instead. Those moves, along with the decision to release some Xbox games on rival consoles, have angered some fans of the platform and led them to question Microsoft's commitment to developing compelling exclusive content. – Bloomberg