WASHINGTON — The U.S. Supreme Court ruled in favor of federal preemption for federally chartered banks operating in the various states in Watters Vs. Wachovia Bank, N.A.
"Wachovia's mortgage business, whether conducted by the bank itself or through the bank's operating subsidiary, is subject to OCC's superintendence, and not the licensing, reporting, and visitorial regimes of the several States in which the subsidiary operates," the Court found.
The ruling explained that national banks' business activities, and their subsidiaries, are covered under the National Bank Act and the rules promulgated by the Office of the Comptroller of the Currency. Operating a subsidiary for the purpose of business that the national bank could perform itself is covered under the incidental powers clause in the NBA, "subject to the same terms and conditions as the bank."
Recommended For You
NASCUS has said it was disappointed with the ruling. Representatives from CUNA and NAFCU were not available for immediate comment.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
