On June 4, the Federal Deposit Insurance Corporation (FDIC) filed an amicus brief in the Tenth Circuit’s en banc rehearing of National Association of Industrial Bankers v. Weiser, supporting industry plaintiffs and arguing that the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) § 525’s phrase “loans made in such State” refers to the state where the bank is located and performs key lending functions, not where the borrower resides. The filing confirms the FDIC’s historical position on the DIDMCA opt out and directly bears on the limited applicability of Colorado’s opt out and UCCC rate caps.

Background

As we discussed in our April 7 post, Colorado enacted H.B. 23‑1229 to opt out of DIDMCA §§ 521–523 and apply UCCC rate caps to certain consumer loans. Section 521 (12 U.S.C. § 1831d) permits state‑chartered, FDIC‑insured banks to export their home‑state rates to out‑of‑state borrowers, mirroring National Bank Act rate exportation. Section 525 allows a state to opt out “with respect to loans made in such State.”

The district court preliminarily enjoined Colorado from enforcing its caps against loans by out‑of‑state, state‑chartered banks, holding that loans are “made” where the bank is located and performs non‑ministerial functions. A Tenth Circuit panel later reversed, adopting a borrower‑location reading of “loans made in such State” and holding that Colorado’s opt‑out stripped § 1831d preemption from loans to Colorado borrowers. In April, the Tenth Circuit granted rehearing en banc, vacated the panel opinion, and ordered supplemental briefing on the meaning of “loans made in such State” and the preemption framework.

The FDIC’s Amicus Brief

In its en banc brief, the FDIC argues that § 525 must be read in light of DIDMCA’s central purpose: preserving rate parity between state‑chartered and national banks and maintaining a competitive dual‑banking system. On that view, “loans made in such State” is best understood as referring to loans made by banks located in the opt‑out state, not all loans to borrowers who happen to live there. Allowing borrower location to control would, in the FDIC’s words, “radically alter” the parity Congress established in § 521 by letting one state’s opt‑out dictate the rates banks in non‑opt‑out states can charge to that state’s residents, effectively projecting its usury law beyond its borders.

The FDIC grounds its interpretation in ordinary usage (a bank, not a borrower, “makes” a loan), DIDMCA’s legislative history (which framed § 525 as a way for affected states to restore their own usury regimes), and its own longstanding exportation guidance. Citing General Counsel’s Opinion No. 11 and related materials, the FDIC reiterates that, for § 521, a loan is “made” where the bank performs non‑ministerial functions such as approval, extension of credit, and disbursement. The FDIC urges the court to apply the same bank‑focused test to § 525, so that opt‑outs are triggered when a bank is located in the opt‑out state for that loan.

The FDIC also acknowledges that it previously filed, and then withdrew, an amicus brief taking a different view of § 525, explaining that its current position better reflects the statutory text and is consistent with the agency’s historical approach to where a loan is “made.”

Our Take

The FDIC’s brief is a significant development in the Weiser en banc proceedings. It aligns the primary federal regulator of state‑chartered banks with the industry plaintiffs on the central interpretive question and underscores the systemic implications of a borrower‑location reading of “loans made in such State.” If the Tenth Circuit adopts the FDIC’s bank‑focused approach, Colorado’s opt‑out would apply only to loans made by banks located in Colorado for that loan, preserving DIDMCA’s exportation regime for out‑of‑state, state‑chartered banks lending to Colorado residents.

For now, however, the law in the Tenth Circuit remains unsettled. With the panel opinion vacated, there is still no binding appellate precedent on whether Colorado can apply its UCCC caps to loans from out‑of‑state, state‑chartered banks to Colorado borrowers.