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Progresso pulls MSG; also: Local banks follow Fed rate cut, Wells Fargo extends truce with Citigroup, and Ameriprise tallies Lehman, WaMu losses

As the nation contemplates images of Depression-era soup lines, the soup war between Campbell’s and General Mills is heating up. General Mill’s said yesterday that it’s removing MSG from all its Progresso brand soups, and it dared Campbell’s to do the same. The announcement was in response to an ad campaign by Campbell’s that a Progesso spokesman called “quite disingenuous.”

US Bank, TCF Bank and Wells Fargo followed the Federal Reserve on Wednesday, lowering prime lending rates by half a percent, down to 4.5 percent. The rates typically move in lockstep with the federal rate. The Los Angeles Times has a good primer on what it means for you: bank depositors will see less interest on their accounts; borrowers should find better rates on car loans and mortgages; and some credit-cardholders may see a reprieve in interest rates.

By the way: Wells Fargo, which is still in a stalemate with Citigroup over which gets to buy Wachovia, said it’s extending its legal truce with Citigroup until Friday. The government is working with all three banks in an attempt to broker a deal in which Wachovia would be split up and sold in pieces to both Citi and Wells Fargo. But according to the Naked Capitalism blog, it doesn’t sound like talks are going well.

Ameriprise Financial expects to be out more than $200 million from the failure of Lehman Brothers, Washington Mutual and other mortgage-backed securities. That’s less than 1 percent of the company’s total investments. Ameriprise also said Wednesday that it has plenty of cash and isn’t reliant on commercial paper, bank lines or other credit markets that have frozen up in recent weeks.

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