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Today in the Fortune 500: BoFA settlement spurs bank stock surge, Motorola splits in two and Ford and GM sell small cars well in India.

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The Fortune 500 comes out just once a year, but the companies on it make headlines every day. Here then are today’s highlights of news and happenings coming from the biggest names in business.

By Shelley DuBois, reporter

BANK OF AMERICA PAYS UP a $2.8 billion settlement to Fannie Mae (FNMA) and Freddie Mac (FMCC), which had accused the bank of botching mortgage loans. Bank of America’s (BAC) settlement perked up investors, and spurred bank stocks in general to rally. [Fortune]

BREAKING UP OVER THE PHONE Motorola (MOT) is officially splitting into two companies: one that will focus on radios and scanners, and the other that will primarily sell set-top-boxes and smartphones. The company’s smartphone business, which has lagged for a while, has picked up since devices have started running the Android operating system. [Wall Street Journal]

GOOGLE’S AFRICA ASPIRATIONS coming out in the form of hiring Ory Okolloh to manage the company’s expansion in the continent. Okolloh created the open-source platform Ushahidi for victims of violence to crowd-source information following the 2007 Kenyan elections. Hiring her is one of many maneuvers Goolgle (GOOG) has made over the past couple of years to increase its African presence. [Fast Company]

BIG OIL WILL BENEFIT FROM PRICE SPIKE according to oil-price predictors with good accuracy records. The price of oil should average $90 per barrel this year, some estimates say, leaving companies including ExxonMobil (XOM), BP (BP) and Roayl Dutch Shell (RDSA) in position to profit. [Bloomberg]

SMALL CARS SELL WELL IN INDIA Fortune 500 motor companies are capitalizing on consumer growth in the Indian market. The country saw a rise in disposable income, which people are starting to spend on cars. General Motors (GM), Ford (F) and Toyota (TM) all saw promising 2010 sales numbers for compact vehicles sold there. [Wall Street Journal]

RACE TO THE CLOUD 2011 could be the year that several Fortune 500 tech companies including Intel (INTC), Hewlett-Packard (HPQ) and IBM (IBM) start spending cash they sat on during the recession as they continue migrating to the cloud. Cisco (CSCO) and Oracle (ORCL) could benefit, being two big players who could offer tech companies cloud-based services and storage. [Bloomberg]