Volkswagen said to agree terms of €20bn bridge loan

Volkswagen has reportedly reached an agreement with banks on the terms of a planned €20bn (£14bn) bridge loan to help the car maker take on the costs of its emissions scandal.

Reuters cited people familiar with the matter as saying that 13 banks are offering credit portions of either €1.5bn or €2.5bn each, or a total of €29bn.

One of the sources said credit portions would be assigned to banks on Friday, while another said that would happen in the coming days, without being more specific.

Volkswagen has set aside €6.7bn to cover the initial costs of the scandal and said it expects additional expenses of at least €2bn for falsifying certification of carbon dioxide emissions.

In November, the company announced plans to cap spending next year at around €12bn, which is €1bn less than the budget for the previous year.

Before the emissions scandal hit, Volkswagen had said it intended to spend around €17bn a year through to 2019 on new vehicles and technology.

At 1050 GMT, VW shares were down 3.3% at €125.80