At the December 11, 2025 meeting of the Financial Stability Oversight Council (FSOC), Comptroller of the Currency Jonathan Gould issued a statement regarding(1) the 10th Circuit Court of Appeals’ recent decision in National Association of Industrial Bankers v. Weiser. The case is centered around Colorado’s new 36 percent interest rate cap on certain consumer debt. In November, the 10th Circuit ruled that Colorado’s interest rate preemption opt-out applies to both banks and borrowers located in Colorado, effectively requiring any state-chartered bank making loans to a Colorado resident to comply with the state’s interest rate cap.
Gould’s statement reads:
In its recently issued National Association of Industrial Bankers v. Weiser decision, the 10th Circuit has allowed Colorado to dictate the interest rate that a state bank located outside of Colorado may charge on certain loans. This decision risks undermining state banks’ ability to effectively administer multi-state lending programs and, perhaps more importantly, disadvantages state banks that wish to lend in Colorado compared to national banks and Federal savings associations. Such an outcome is fundamentally inconsistent with Congress’s efforts to create competitive equality between state and federally chartered banks. Courts or, if necessary, Congress should remedy this outcome.
Background
Before 1980, national banks and state-chartered banks operated on two completely different playing fields when it came to interest rates. National banks were subject to the “discount-plus-one rate,” which capped the allowable interest charges at the rate of 90-day commercial paper from their home Federal Reserve bank plus one percent. As a result of federal preemption, national banks did not have to comply with state interest rate laws. The preemption also made the interest rates portable to other states that might otherwise have more restrictive interest rate caps. State-chartered banks, on the other hand, were subject to both their chartering state’s laws on interest rates and the interest rates of other states where they made loans.
The Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) gave state-chartered banks access to the discount-plus-one rate and its portability mechanism. Notably, however, DIDMCA included the following Effective Date note:
Section applicable only with respect to loans made in any State during the period beginning on April 1, 1980, and ending on the date, on or after April 1, 1980, on which such State adopts a law or certifies that the voters of such State have voted in favor of any provision, constitutional or otherwise, which states explicitly and by its terms that such State does not want this section to apply with respect to loans made in such State.
DIDMCA, therefore, gave states the right to opt out of federal preemption for loans “made in such state.” Until the 10th Circuit’s recent decision, there was no definition or legal interpretation of the term “made in such state.” The banks support a narrow definition that applies the law only to Colorado’s state-chartered banks. In contrast, the state of Colorado supports a definition that would apply the law to both Colorado’s state-chartered banks and any bank making a loan to a Colorado resident. The 10th Circuit held in favor of Colorado, which in turn led to the Comptroller’s statement.
Analysis
The Comptroller’s statement on this ruling is both surprising and unsurprising. The surprising part of his statement lies in the fact that this ruling, if left unchallenged (which is highly unlikely), would give nationally chartered banks under the purview of his regulatory agency, the Office of the Comptroller of the Currency (OCC), a significant competitive advantage. If state-chartered banks cannot benefit from federal preemption of state interest rate laws in Colorado, national banks would have an effective monopoly on the discount-plus-one-rate within the state. As a result, national banks will be able to eschew the Colorado interest rate cap by virtue of their charter and offer more competitive rates.
The preemption of state rate caps also makes national banks more attractive as fintech partner banks, as fintech lenders are generally subject to their partner banks’ regulatory requirements. A fintech would likely prefer to align itself with a national charter (i.e., federal preemption) in Colorado than a state-chartered bank (i.e., subject to Colorado’s interest rate cap). An additional consideration is the venue in which this case is being considered. Although, for now, this is limited to Colorado, this case is in federal court.
As such, and depending upon the final outcome of the case, there is a possibility that this could cross state lines. In this case, national banks would become exponentially more advantageous, both to fintechs looking for partners and consumers writ large. State-chartered banks would be significantly harmed by this development, as the competitive advantage would be tipped heavily towards national banks in pricing loans. The unsurprising part of Gould’s statement is that, notwithstanding the competitive advantage his supervised banks would see from this ruling and his wide-spanning view of federal preemption, Gould expressed a preference for a more level regulatory playing field. This preference is consistent with Gould’s goal of reducing regulatory burden. Under his direction, the OCC has retracted several guidance documents and has postured itself as attempting to ease regulatory burdens on supervised institutions. Any state regulatory or enforcement activity beyond the OCC’s supervisory priority of “material financial risks” could be seen as “regulatory burden,” and could potentially counteract the federal priorities observed in 2025. A state-level interest rate cap applicable to a state-chartered bank and any borrower living in that state threatens to create cumbersome regulatory patchworks across the states and territories should other states enact similar legislation, with a concomitant significant increase in regulatory burden.
Conclusion
This ruling is far from the last word on the federal preemption question. Amicus briefs in support of a rehearing are due on December 16, 2025, and the court will decide on a rehearing petition. Given the wide-ranging implications of this case, litigation, including appeals, will likely continue. Banks, especially state-chartered institutions with multistate lending operations or fintech partnerships, should keep this case top of mind.
About the author
Ryan Labriola is a Senior Manager with Asurity Advisors. Ryan has expertise in military lending laws and regulations, including the Servicemembers Civil Relief Act and the Military Lending Act. He has advised financial institutions and non-bank lenders on SCRA and MLA compliance, and has participated in significant lookback and remediation engagements relating to servicemembers’ benefits and protections under federal and state law.