Marquette National Bank of Minneapolis v. First of Omaha Service Corp.
Seminal 1978 U.S. Supreme Court banking-law case / From Wikipedia, the free encyclopedia
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Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp., 439 U.S. 299 (1978), is a unanimous U.S. Supreme Court decision holding that state anti-usury laws regulating interest rates cannot be enforced against nationally chartered banks based in other states. Justice William Brennan wrote that it was clearly the intent of Congress when it passed the National Banking Act that nationally chartered banks would be subject only to federal regulation by the Comptroller of Currency and the laws of the state in which they were chartered, and that only Congress or the appropriate state legislature could pass the laws regulating them.
Marquette Bank of Minneapolis v. First of Omaha Service Corp. | |
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Argued October 31, 1978 Decided December 18, 1978 | |
Full case name | Marquette Nat. Bank v. First of Omaha Svc. Corp., |
Citations | 439 U.S. 299 (more) 99 S. Ct. 540; 58 L. Ed. 2d 534 |
Case history | |
Prior | State action refiled in district court, then remanded to state court, 422 F. Supp. 1346 (D. Minn. 1976).; injunction in state court overturned by Minnesota Supreme Court on appeal, 262 N.W.2d 358 (Minn. 1977); certiorari granted, 436 U.S. 916 (1978). |
Holding | |
State anti-usury laws cannot be enforced on nationally chartered banks based in other states; only laws of state in which banks are located apply, and regulation of interest rates on national banks making interstate loans can only be enacted by Congress or the appropriate state legislature | |
Court membership | |
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Case opinion | |
Majority | Brennan, joined by unanimous |
Laws applied | |
National Banking Act |
The case has been called one of the most important of the late 20th century, since it freed nationally chartered banks to offer credit cards to anyone in the U.S. they deemed qualified, and more specifically because it allowed them to export credit card interest rates to states with stricter regulations, opening up a race between states in an effort to attract lending institutions to set up shop in their states and offer a wider variety of consumer credit products. Over the next decade, the states accelerated a process that had already begun of repealing or loosening their anti-usury laws, allowing state-chartered banks to compete more equally with national ones. As a result, the use of credit cards has vastly increased, and the mortgage industry soon followed suit.