Good morning. Mexican financial authorities said Thursday that they are taking over two small local banks that were identified by the U.S. Treasury Department as being involved in money laundering and facilitating payments for precursors used to make fentanyl.

• Temporary management: Mexico’s Banking and Securities Commission decreed temporary management intervention in CIBanco and Intercam Banco to prevent a run on deposits.
   
• A first: The Treasury said the measures imposed by its Financial Crimes Enforcement Network mark the first actions under the Fentanyl Sanctions Act and the FEND Off Fentanyl Act, part of a Trump administration effort to combat fentanyl smuggling.
   
• No convincing evidence: Mexico’s Finance Ministry said Wednesday that the Treasury Department hadn’t provided convincing evidence of the alleged wrongdoing by the banks it identified. It said the information focused on transfers conducted through the banks with legally established Chinese companies.
   
• Small stuff: CIBanco and Intercam each account for less than 1% of Mexico’s banking system by assets, or roughly a combined $12 billion.

Apple reworks European app store policy to swerve more EU fines.

Apple has reworked the terms and conditions for developers that use its highly lucrative App Store in the European Union in a bid to avoid racking up more fines under the EU’s digital antitrust law.

The iPhone maker is trying to avoid yet more financial penalties after the European Commission – the EU’s executive arm – ruled in April that the company’s terms and conditions violate the Digital Markets Act, a relatively new law aimed at curbing the market power of tech giants like Apple. The watchdog fined Apple 500 million euros ($583 million), saying the obligations it imposes on developers that prevent them from steering customers to better deals outside of the App Store are unfair.

Financial watchdog calls for more action on crypto risks.

A global financial watchdog said stronger actions are needed to address the illicit finance risks associated with cryptocurrencies, as countries around the world are in the process of developing regulatory frameworks to cover the nascent industry.

The Financial Action Task Force, which sets international standards for anti-money-laundering rules, in a new report Thursday said countries have overall made progress on implementing measures to address illicit finance risks in cryptocurrencies and crypto-related companies since 2024. The progress includes developing or implementing anti-money-laundering regulations and taking supervisory and enforcement actions.

• Oil executives enlisted President Trump in fights against clean-car rules, drilling restraints and climate laws from New York to California. Now, they have won his support in their effort to quash Europe’s flagship environment rules.
   
• The intensifying conflict in the Middle East has pushed inflation higher for the first time in 2025 and weakened confidence in the eurozone, according to data released Friday.
   
• The U.S. and other countries reached an agreement to exempt U.S.-based companies from some corporate taxes that were part of a 2021 international minimum-tax agreement, Treasury Secretary Scott Bessent said Thursday.
   
• The Securities and Exchange Commission is looking at changing executive compensation rules to lower compliance costs and add clarity for companies.
   
• Steptoe’s U.K. business was formally rebuked by the United Kingdom’s Solicitors Regulation Authority for several breaches of Treasury license conditions related to Russia sanctions.
   
• Mexican financial authorities said Thursday that they are taking over two small local banks and a brokerage firm that were identified by the U.S. Treasury Department as being involved in money laundering and facilitating payments for precursors used to make fentanyl.

EU considers lowering tariffs on U.S. imports in effort to woo Trump.

The European Union is considering lowering tariffs on a range of U.S. imports in a bid to clinch a speedy trade deal with President Trump, according to people familiar with the matter.

EU leaders are set to debate how much they are willing to sacrifice to win over Trump at a meeting in Brussels on Thursday evening. Other concessions under consideration include lowering nontariff barriers, buying more American products including liquefied natural gas, and offering to cooperate with the U.S. to tackle its economic concerns about China.

• The U.S. strikes on Iran’s nuclear facilities unfolded half a world away from North Korea. But for dictator Kim Jong Un, the attacks were a clear lesson: Nuclear weapons are critical for his survival.
   
• President Trump’s frustration with Federal Reserve Chair Jerome Powell over his hesitance to cut interest rates has prompted Trump to consider naming Powell’s successor as soon as this summer. But though some officials are now weighing support for a cut at the Fed’s next meeting, reluctance to ease too quickly still prevails on the Fed’s 12-member policy committee.
   
• The Middle East is undergoing a dramatic realignment—just not the one U.S. and regional leaders envisioned less than two years ago.
   
• China on Friday pledged to approve export applications for rare earths to the U.S., potentially easing a major irritant in the countries’ trade negotiations that has also become a source of deepening concern for American manufacturers.
   
• China’s industrial profit declined in May from a year earlier, reversing gains seen in the prior month, as weak demand and U.S. trade tariffs weighed on profitability.
   
• Consumer inflation in the Tokyo metropolitan area eased in June but remained firmly above the Bank of Japan’s 2% target, leaving the central bank balancing on a policy tightrope.

• Several of Republicans’ largest proposed spending reductions can’t be done as written in the fast-track budget process they are using to advance their megabill, the Senate parliamentarian determined, dealing a setback to the GOP’s hopes of passing their plans quickly.
   
• The Trump administration Thursday asked McKinsey, BCG and several other firms with billions of dollars in federal contracts to justify their work—and suggest cost cuts.
   
• Shell said it hasn’t approached BP and doesn’t plan to make an offer for its rival, denying that it was in talks over what would be the largest oil deal in a generation.
   
• BlackRock is accelerating a push into private investments by including them in funds for 401(k) retirement plans.
   
• Jes Staley has failed in a long-shot bid to clear his name, with a U.K. tribunal upholding a financial-industry ban over his ties to disgraced financier Jeffrey Epstein.

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