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The Office of the Comptroller of the Currency (OCC) recently released two interpretive letters in which it posits a loan nexus test as a method to determine applicable state law with respect to loan transactions for banks with branches in more than one state.
Interpretive Letter No. 686, PNC Bank, September 1995
PNC Bank, a national bank with its main office in Pennsylvania and branches in New Jersey, asked whether under section 85 of the National Bank Act it could charge New Jersey interest rates on loans made from its New Jersey branches. The OCC first affirmed that a national bank is "located" not only in the state in which it has its main office, but also in any state in which it has a branch. Merely because the statute references "the state" in which the bank is located does not mean that a national...