Overview
In an opinion released on November 10, 2025 in National Association of Industrial Bankers v. Weiser, the Tenth Circuit held that Colorado may opt out of national standards for interest rates set by the Depository Institutions Deregulation and Monetary Control Act of 1980 (see 12 U.S.C. § 1831d) for loans made to consumers within Colorado, notwithstanding the home state of the lending state bank. This decision represents a critical expansion of states' ability to regulate lending by out-of-state, state-chartered banks. Given its focus on state banks, it could increase the value of national bank charters, which remain capable of exporting their home-state interest rate pursuant to 12 U.S.C. § 85.
The Tenth Circuit opinion stems from a suit filed by a collection of financial services trade associations (the "Trade Associations") against the Colorado Attorney General and Administrator of the Colorado Uniform Consumer Credit Code, in which the Trade Associations seek to block Colorado from exercising its opt-out right pursuant to 12 U.S.C. § 1831d. That provision permits state-chartered banks to charge interest rates that parallel those available to national banks: the greater of one percent more than the discount rate on ninety-day commercial paper, or whatever rate is permitted by the state in which the bank is located. However, § 1831d permits states to opt out of the statute's interest rate provisions. Colorado exercised this right in 2023 and purported to apply the opt-out to loans to Colorado borrowers. The Trade Associations sued, arguing that Colorado's opt-out only applied to loans made by state banks located within Colorado, and sought a preliminary injunction, which the District Court granted (Nat'l Ass'n of Indus. Bankers v. Weiser, 737 F. Supp. 3d 1113 (D. Colo. 2024)), leading to the defendants' appeal to the Tenth Circuit.
In the section of the opinion most crucial to state-chartered banks and fintechs, the Tenth Circuit concluded that the opt-out provision, applicable where "such State does not want [the interest-rate section] to apply with respect to loans made in such State," refers to loans in which either lender or borrower is located in the opt-out state. This reasoning could have far-reaching consequences for the financial services industry.
Although currently, Iowa and Puerto Rico are the only states besides Colorado to have opted out of 12 U.S.C. § 1831d, this decision creates risk for financial services firms within the Tenth Circuit. Firms lending within Colorado should immediately assess their lending operations and rates charged against Colorado's lending statutes. The Tenth Circuit's opinion expressly mentions fintech firms' use of "rent-a-bank" partnerships to export rates from states with high (or no) interest rate ceilings. Because the Tenth Circuit's holding would permit states to impose new restrictions on lending foreign state-chartered banks, consumer advocates may push state legislatures to enact opt-out legislation in states within the Tenth Circuit, or advance the Tenth Circuit's arguments in other circuits in pursuit of similar holdings. Nonbank lenders relying on partners holding state bank charters may wish to reevaluate their partnerships; national bank partners may hold more appeal in light of their continued ability to export home-state interest rates. Steptoe's Financial Innovation and Regulation practice group stands ready to support firms evaluating their options in light of this new development.
