Broad Coalition Supports Challenge to Oregon's Restrictions on Interstate Banking
A broad coalition spanning federal regulators, state attorneys general, banks, and consumer lenders submitted amici briefs in National Association of Industrial Bankers v. O'Day supporting the position taken by the National Association of Industrial Bankers (NAIB), the American Financial Services Association (AFSA), and the American Fintech Council (AFC). The briefs oppose Oregon's contention that it has authority to remove the essential protections of the federal Depository Institutions Deregulation and Monetary Control Act (DIDMCA) for state banks outside of Oregon, jeopardizing the entire interstate banking system.
"The amici briefs underscore a growing consensus that Oregon's law threatens the uniform federal interstate banking framework Congress established more than four decades ago and, if allowed to stand, would reduce access to responsible credit for consumers nationwide," said Frank Pignanelli, Executive Director of the National Association of Industrial Bankers.
The amici supporting the plaintiffs include:
Background
On June 15, a coalition of financial services trade groups, including the National Association of Industrial Bankers (NAIB), American Financial Services Association (AFSA), and Online Lenders Alliance (OLA), filed a lawsuit in the federal district court in Oregon against the Oregon Department of Consumer and Business Services seeking a preliminary injunction to prevent enforcement of House Bill 4116. Oregon's recently enacted legislation applies its interest-rate limits to loans made by out-of-state banks, setting up a direct conflict with the longstanding federal interstate banking framework under DIDMCA. If Oregon's interpretation prevails, consumers nationwide would face a confusing patchwork of state rules that would raise costs, restrict credit, and accelerate consolidation by the nation's largest banks.