(Slip Opinion)              OCTOBER TERM, 2023                                       1

                                       Syllabus

         NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
       being done in connection with this case, at the time the opinion is issued.
       The syllabus constitutes no part of the opinion of the Court but has been
       prepared by the Reporter of Decisions for the convenience of the reader.
       See United States v. Detroit Timber & Lumber Co., 

.


SUPREME COURT OF THE UNITED STATES

                                       Syllabus

  CANTERO ET AL., INDIVIDUALLY AND ON BEHALF OF ALL
   OTHERS SIMILARLY SITUATED v. BANK OF AMERICA,
                         N. A.

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
                 THE SECOND CIRCUIT

    No. 22–529.      Argued February 27, 2024—Decided May 30, 2024
The United States maintains a dual system of banking. Banks with
  federal charters—called national banks—are subject primarily to
  federal oversight and regulation. Banks with state charters are
  subject to additional state oversight and regulation. As relevant here,
  the National Bank Act expressly grants national banks the power to
  administer home mortgage loans. 

(a). When national
  banks make home mortgage loans, they often offer escrow accounts
  designed to protect both the bank and the borrower. Escrow accounts
  ensure the availability of funds to pay the insurance premium and
  property taxes on the borrower’s behalf. Escrow accounts operated by
  national banks are extensively regulated by the Real Estate
  Settlement Procedures Act of 1974. RESPA was designed to protect
  borrowers from “certain abusive practices” that were being carried on
  by national banks. §2601(a). But RESPA does not mandate that
  national banks pay interest to borrowers on the balances of their
  escrow accounts. New York state law is different. It provides that a
  bank “shall” pay borrowers “interest” on the balance held in an escrow
  account maintained in connection with a mortgage on certain real
  estate. N. Y. Gen. Oblig. Law Ann. §5–601.
    In this case, petitioner Alex Cantero and petitioners Saul Hymes
  and Ilana Harwayne-Gidansky obtained home mortgage loans from
  Bank of America, a national bank chartered under the National Bank
  Act. Both contracts required the borrowers to make monthly deposits
  into escrow accounts. Bank of America did not pay interest on the bal-
  ances held in either escrow account, but informed the borrowers that
  the New York interest-on-escrow law was preempted by the National
2               CANTERO v. BANK OF AMERICA, N. A.

                                 Syllabus

    Bank Act. The borrowers brought putative class-action suits in Fed-
    eral District Court. The District Court concluded that nothing in the
    National Bank Act or other federal law preempted the New York law.
    The Second Circuit reversed, holding that because the New York law
    “would exert control over” national banks’ power “to create and fund
    escrow accounts,” the law was preempted.
Held: The Second Circuit failed to analyze whether New York’s interest-
 on-escrow law is preempted as applied to national banks in a manner
 consistent with Dodd-Frank and Barnett Bank. Pp. 5–14.
    (a) Congress has instructed courts how to analyze federal
 preemption of state laws regulating national banks in the Dodd-Frank
 Wall Street Reform and Consumer Protection Act of 2010. Dodd-
 Frank ruled out field preemption. Instead, Dodd-Frank provides that
 the National Bank Act preempts a state law “only if” the state law
 (i) discriminates against national banks as compared to state banks;
 or (ii) “prevents or significantly interferes with the exercise by the
 national bank of its powers,” as determined “in accordance with the
 legal standard for preemption” in the Court’s decision in Barnett Bank
 of Marion Cty., N. A. v. Nelson, 

. §§25b(b)(1)(A), (B).
 Because the New York law does not discriminate against national
 banks, the preemption question must be analyzed under Dodd-Frank’s
 “prevents or significantly interferes” preemption standard “in
 accordance with” Barnett Bank. Pp. 5–12.
       (1) In Barnett Bank, a dispute arose because a national bank
 wanted to sell insurance in a Florida small town, but the State
 prohibited most banks from selling insurance. The Court held the
 Florida law preempted because it significantly interfered with the
 national bank’s ability to sell insurance—a federally authorized power.
 Importantly, Barnett Bank made clear that a non-discriminatory state
 banking law can be preempted even if it is possible for the national
 bank to comply with both federal and state law. 

. The
 Court reasoned that “normally Congress would not want States to
 forbid, or to impair significantly, the exercise of a power that Congress
 explicitly granted.” 

. But the Court added that its ruling did
 not “deprive States of the power to regulate national banks, where
 (unlike here) doing so does not prevent or significantly interfere with
 the national bank’s exercise of its powers.” 

 Pp. 6–7.
       (2) Barnett Bank did not purport to establish a clear line to
 demarcate when a state law “significantly interfere[s]” with a national
 bank’s ability to exercise its powers. 

. Instead, the
 Court analyzed its precedents on that issue, looking to prior cases
 where the state law was preempted and where the state law was not
 preempted. Given Dodd-Frank’s direction to identify significant
 interference “in accordance with” Barnett Bank, courts addressing
                   Cite as: 

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                              Syllabus

preemption questions in this context must do the same and likewise
take account of those prior decisions. §25b(b)(1)(B). The paradigmatic
example of significant interference identified by Barnett Bank
occurred in Franklin National Bank of Franklin Square v. New York,

, where a New York law prohibiting most banks “from
using the word ‘saving’ or ‘savings’ in their advertising or business”
was held preempted because it interfered with the national bank’s
statutory power “to receive savings deposits.” 

, 378–379.
The Court in Franklin found the New York law preempted—even
though it did not bar national banks from receiving (or even
advertising) savings deposits—because the New York law interfered
with the banks’ ability to advertise “using the commonly understood
description which Congress has specifically selected.” 

.
Barnett Bank also pointed to a second example of significant
interference—Fidelity Federal Savings & Loan Association v. De la
Cuesta, 458 U. S. 141—where the state law similarly limited a
federally authorized power. For purposes of applying Dodd-Frank’s
preemption standard, Franklin, Fidelity, and Barnett Bank together
illustrate the kinds of state laws that significantly interfere with the
exercise of a national bank power and thus are preempted. Pp. 7–9.
     (3) The primary example of a case identified in Barnett Bank
where state law was not preempted is Anderson National Bank v.
Luckett, 

. There, a Kentucky law required banks to turn
over abandoned deposits to the State. The Anderson Court held that
the Kentucky law did not interfere with national banks’ federal power
to collect deposits because that power includes the inseparable
“obligation to pay” deposits to those “entitled to demand payment.” 

at 248–249. Anderson distinguished a similar California law at issue
in First National Bank of San Jose v. California, 

, where
the Court had found the state law to be preempted, and its reasons for
differentiating the California law help demonstrate when a state law
regulating national banks crosses the line from permissible to
preempted. In contrast to the Kentucky law in Anderson, the
California law in First National Bank of San Jose allowed the State to
claim dormant deposits without proof of abandonment. The Court
noted that California’s law could therefore cause customers to
“hesitate” before depositing funds at the bank—and thus interfere
with the “efficiency” of the national bank in receiving deposits. 262
U. S., at 369–370. Barnett Bank also cited two other examples of state
laws that were not preempted, both of which regulated banks in “their
daily course of business.” See National Bank v. Commonwealth, 

; McClellan v. Chipman, 

. Pp. 9–11.
   (b) The Court’s precedents applying Barnett Bank furnish content to
the significant-interference test—and therefore also to Dodd-Frank’s
4               CANTERO v. BANK OF AMERICA, N. A.

                                 Syllabus

    preemption standard incorporating Barnett Bank. A court applying
    that standard must make a practical assessment of the nature and
    degree of the interference caused by a state law. If the state law’s
    interference with national bank powers is more akin to the
    interference in cases like Franklin, Fidelity, First National Bank of
    San Jose, and Barnett Bank, then the state law is preempted. But if
    the state law’s interference with national bank powers is more akin to
    the interference in cases like Anderson, National Bank, and
    McClellan, then the state law is not preempted. In this case, the
    Second Circuit did not conduct the kind of nuanced comparative
    analysis required by Barnett Bank, but instead distilled a categorical
    test that would preempt virtually all state laws that regulate national
    banks. Congress expressly incorporated Barnett Bank into Dodd-
    Frank, and Barnett Bank did not draw a bright preemption line. The
    Court of Appeals must conduct a preemption analysis in a manner
    consistent with that standard. Pp. 12–14.

, vacated and remanded.

    KAVANAUGH, J., delivered the opinion for a unanimous Court.
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                             Opinion of the Court

     NOTICE: This opinion is subject to formal revision before publication in the
     United States Reports. Readers are requested to notify the Reporter of
     Decisions, Supreme Court of the United States, Washington, D. C. 20543,
     [email protected], of any typographical or other formal errors.


SUPREME COURT OF THE UNITED STATES
                                   _________________

                                   No. 22–529
                                   _________________


 ALEX CANTERO, ET AL., INDIVIDUALLY AND ON BEHALF
 OF ALL OTHERS SIMILARLY SITUATED, PETITIONERS v.
             BANK OF AMERICA, N. A.
 ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
           APPEALS FOR THE SECOND CIRCUIT
                                 [May 30, 2024]

  JUSTICE KAVANAUGH delivered the opinion of the Court.
  Federal law extensively regulates national banks such as
Bank of America and expressly preempts some (but not all)
state laws that regulate national banks. This case concerns
the standard for determining when state laws that regulate
national banks are preempted. As relevant here, the Dodd-
Frank Act of 2010 expressly incorporated the standard that
this Court articulated in Barnett Bank of Marion County,
N. A. v. Nelson, 

 (1996).            12 U. S. C.
§25b(b)(1)(B). That standard asks whether a state law
“prevents or significantly interferes with the exercise by the
national bank of its powers.” Ibid. Because the Court of
Appeals in this case did not apply that standard in a
manner consistent with Dodd-Frank and Barnett Bank, we
vacate and remand.
                           I
                           A
  The United States maintains a dual system of banking,
made up of parallel federal and state banking systems.
That dual system allows privately owned banks to choose
2           CANTERO v. BANK OF AMERICA, N. A.

                     Opinion of the Court

whether to obtain a charter from the Federal Government
or from a state government.
  Banks with federal charters, called national banks, are
subject primarily to federal oversight and regulation. And
banks with state charters, called state banks, are subject to
additional state oversight and regulation. Those two
banking systems co-exist and compete.
  The national banking system began in 1863 when
Treasury Secretary (later Chief Justice) Salmon Chase
proposed, Congress passed, and President Lincoln signed
the National Bank Act. 

; 

. When a
bank obtains a federal charter under the National Bank
Act, the national bank gains various enumerated and
incidental powers. 

. The National Bank Act
expressly affords national banks the powers that they need
to organize and operate—for example, the powers to “make
contracts,” to “sue and be sued,” and to “elect or appoint” a
“board of directors.” §24. The Act also provides national
banks with banking-specific powers. As relevant here, the
Act expressly supplies national banks with the power to
“make, arrange, purchase or sell loans or extensions of
credit secured by liens on interests in real estate”—in other
words, to administer home mortgage loans. §371(a). The
Act also expressly authorizes national banks to exercise “all
such incidental powers as shall be necessary to carry on the
business of banking.” §24.
  When national banks make home mortgage loans, they
often offer escrow accounts. Mortgage-escrow accounts are
designed to protect both the bank and the borrower. When
the borrower makes a mortgage payment, the borrower
puts money into an escrow account operated by the bank;
the bank then uses the funds in escrow to pay the
borrower’s insurance premium and property taxes on the
borrower’s behalf. That arrangement helps the borrower by
simplifying expenses and budgeting. Instead of having to
pay large lump-sum insurance and tax payments once or
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                       Opinion of the Court

twice a year, the borrower can instead make small
payments throughout the year. And the arrangement also
assists the bank by ensuring that the borrower’s insurance
and tax bills are timely paid, thus protecting the loan
collateral (the home) against tax foreclosure or uninsured
damage.
  In light of those benefits to both sides, the vast majority
of home mortgages come with escrow accounts. Indeed,
many federal agencies and programs require them. The
Federal Housing Administration and the Department of
Agriculture’s Rural Housing Service, for example, mandate
escrow accounts for mortgages that they administer or
insure.
  In the 1970s, Congress found that some national banks
were engaging in “certain abusive practices” and that
“significant reforms” were necessary to protect borrowers.

(a). To that end, Congress passed and
President Ford signed the Real Estate Settlement
Procedures Act of 1974, or RESPA. Among other things,
RESPA extensively regulates national banks’ operation of
escrow accounts. RESPA first sets out the general terms
for national banks that operate escrow accounts. For
example, RESPA requires national banks to “promptly
retur[n] to the borrower” any funds left over after the loan
is paid, §2605(g), and to provide borrowers with
notifications and account statements, §§2609(b), (c).
RESPA also contains a specific safeguard for borrowers: It
caps the amount that national banks can require borrowers
to deposit into escrow accounts. §2609(a). But as relevant
to this case, RESPA (unlike New York law, as we will
discuss) does not mandate that national banks pay interest
to borrowers on the balances of their escrow accounts.1
——————
  1 Another federal law, the Truth in Lending Act, also addresses

national banks’ operation of mortgage-escrow accounts. The Truth in
Lending Act requires national banks to operate escrow accounts for
certain mortgages. 

, 15 U. S. C. §1639d. For those
4             CANTERO v. BANK OF AMERICA, N. A.

                         Opinion of the Court

                              B
   Bank of America is a national bank chartered under the
National Bank Act. Bank of America offers mortgage loans
to homeowners, among other services.
   In 2010, Alex Cantero obtained a home mortgage loan
from Bank of America to purchase a house in Queens
Village, New York. In 2016, Saul Hymes and Ilana
Harwayne-Gidansky similarly obtained a home mortgage
loan from Bank of America to buy a house in East Setauket,
New York. Both mortgage contracts required the borrowers
to make monthly deposits into escrow accounts, which Bank
of America used to pay the borrowers’ property taxes and
insurance premiums when those taxes and premiums came
due.
   Under New York law, when a bank “maintains an escrow
account pursuant to any agreement executed in connection
with a mortgage” on certain real estate, the bank “shall”
pay borrowers “interest at a rate of not less than two per
centum per year” on the balance. N. Y. Gen. Oblig. Law
Ann. §5–601 (West 2022). But Bank of America did not pay
interest on the money in Cantero’s escrow account or
Hymes and Harwayne-Gidansky’s escrow account. Bank of
America notified the borrowers that the New York law was
preempted by the National Bank Act. Both plaintiffs
brought putative class-action suits against Bank of America
in the U. S. District Court for the Eastern District of New
York, alleging that Bank of America violated New York law
by failing to pay them interest on the balances in their
escrow accounts.
   The District Court decided the two cases together. The
court agreed with the plaintiffs that New York law required

——————
mandatory escrow accounts, the national bank must “pay interest” to the
borrower “in the manner as prescribed by [an] applicable State or
Federal law.” §1639d(g)(3). All parties agree that §1639d does not apply
to the mortgages in this case.
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                     Opinion of the Court

Bank of America to pay interest on the escrow account
balances. The court ruled that the New York interest-on-
escrow law applied to national banks such as Bank of
America, concluding that nothing in the National Bank Act
or other federal law preempted the New York law. Hymes
v. Bank of America, N. A., 

, 198 (EDNY
2019).
   The U. S. Court of Appeals for the Second Circuit
reversed, holding that the New York interest-on-escrow law
was preempted as applied to national banks. Relying
primarily on “an unbroken line of case law since McCulloch
[v. Maryland, 

 (1819)],” the Court of Appeals
held that federal law preempts any state law that “purports
to exercise control over a federally granted banking power,”
regardless of “the magnitude of its effects.” 

,
131 (2022). Because the New York interest-on-escrow law
“would exert control over” national banks’ power “to create
and fund escrow accounts,” the court concluded that the law
was preempted. 

.
   This Court granted certiorari. 

 (2023).
                              II
  Congress has instructed courts how to analyze federal
preemption of state laws regulating national banks. In the
wake of the 2008 financial crisis, Congress passed and
President Obama signed the Dodd-Frank Wall Street
Reform and Consumer Protection Act of 2010. Pub. L. 111–
203, 

. Among other things, Dodd-Frank
established the controlling legal standard for when a “State
consumer financial law,” like New York’s interest-on-
escrow law, is preempted with respect to national banks.
12 U. S. C. §25b.
  To begin, Dodd-Frank ruled out field preemption.
§25b(b)(4) (federal banking law “does not occupy the field in
any area of State law”). As a result, we know that not all
state laws regulating national banks are preempted.
6             CANTERO v. BANK OF AMERICA, N. A.

                         Opinion of the Court

  Instead, Dodd-Frank provided, as relevant here, that the
National Bank Act preempts a state law “only if” the state
law (i) discriminates against national banks as compared to
state banks; or (ii) “prevents or significantly interferes with
the exercise by the national bank of its powers,” as
determined “in accordance with the legal standard for
preemption in the decision of the Supreme Court of the
United States in Barnett Bank of Marion County, N. A. v.
Nelson, Florida Insurance Commissioner, et al., 

(1996).” §§25b(b)(1)(A), (B).
  New York’s interest-on-escrow law does not discriminate
against national banks. The question of whether New
York’s interest-on-escrow law is preempted therefore must
be analyzed under Dodd-Frank’s “prevents or significantly
interferes” preemption standard.           To guide judicial
application of that preemption standard, Dodd-Frank
expressly incorporates this Court’s decision in Barnett
Bank. The preemption question here therefore must be
decided “in accordance with” Barnett Bank, as Dodd-Frank
directs. §25b(b)(1)(B).2
                              A
   In Barnett Bank, a Florida law prohibited most banks
from selling insurance. Barnett Bank of Marion Cty., N. A.
v. Nelson, 

 (1996). A dispute arose because
federal law authorized national banks to sell insurance in
small towns, and a national bank wanted to sell insurance
in a small Florida town. 

 at 28–29.
   This Court held that the Florida law was preempted
because the law significantly interfered with the national
——————
   2 Cantero’s mortgage agreement (unlike Hymes and Harwayne-

Gidansky’s mortgage agreement) was signed after Dodd-Frank was
enacted but before Dodd-Frank became effective. Because we conclude
that Dodd-Frank adopted Barnett Bank, and because Barnett Bank was
also the governing preemption standard before Dodd-Frank, the timing
of Cantero’s mortgage agreement does not affect the preemption analysis
here.
                 Cite as: 

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                     Opinion of the Court

bank’s ability to exercise a power—selling insurance—
authorized by federal law. 

 at 33–35. Importantly,
Barnett Bank made clear that a non-discriminatory state
banking law can be preempted even if it is possible for the
national bank to comply with both federal and state law—
there, by declining to sell insurance. 

. The Court
emphasized that federal law’s “grants of both enumerated
and incidental ‘powers’ to national banks” are “grants of
authority not normally limited by, but rather ordinarily
pre-empting, contrary state law.” 

. Congress had
afforded national banks a “broad, not a limited,” power to
sell insurance—a power “without relevant qualification.”

 The Court reasoned that “normally Congress would
not want States to forbid, or to impair significantly, the
exercise of a power that Congress explicitly granted.” 

. Because federal law “explicitly grant[ed] a national
bank an authorization, permission, or power” with “no
indication that Congress intended to subject that power to
local restriction,” the Court concluded that state law could
not limit national banks’ ability to sell insurance. 

 at
34–35 (internal quotation marks omitted); see 

.
But the Court added that its ruling did not “deprive States
of the power to regulate national banks, where (unlike here)
doing so does not prevent or significantly interfere with the
national bank’s exercise of its powers.” 

.
   In short, Barnett Bank decided that the non-
discriminatory Florida law at issue there significantly
interfered with the bank’s exercise of its powers, and thus
was preempted.
                             B
  But Barnett Bank did not purport to establish a clear line
to demarcate when a state law “significantly interfere[s]
with the national bank’s exercise of its powers.” 

Instead, the Court analyzed the Court’s precedents on that
issue. Specifically, to determine whether the Florida law
8            CANTERO v. BANK OF AMERICA, N. A.

                      Opinion of the Court

was preempted, Barnett Bank looked to prior cases of this
Court where the state law was preempted, as well as
several cases where the state law was not preempted.
Given Dodd-Frank’s direction to identify significant
interference “in accordance with” Barnett Bank, courts
addressing preemption questions in this context must do as
Barnett Bank did and likewise take account of those prior
decisions of this Court and similar precedents.
§25b(b)(1)(B).
  The paradigmatic example of significant interference
identified by Barnett Bank occurred in Franklin National
Bank of Franklin Square v. New York, 

 (1954).
The New York law at issue in Franklin prohibited most
banks “from using the word ‘saving’ or ‘savings’ in their
advertising or business.” 

. The Franklin Court
concluded that the law was preempted because it interfered
with the national bank’s statutory power “to receive savings
deposits.” 

, 378–379. Importantly, the New York
law did not bar national banks from receiving savings
deposits, “or even” from “advertising that fact.” 

.
Nonetheless, the Court determined that the New York law
significantly interfered with the banks’ power because the
banks could not advertise effectively “using the commonly
understood description which Congress has specifically
selected” to describe their activities: receiving savings
deposits. 

 Federal law gave national banks the power
not only “to engage in a business,” but also “to let the public
know about it”—and state law could not interfere with the
national bank’s ability to do so efficiently. 

 at 377–378.
  In Barnett Bank, the Court compared the Florida
insurance law at issue there to the New York savings-
deposit law at issue in Franklin, and the Court concluded
that the two state laws were “quite similar.” 

. Because the Florida law interfered with the national
bank’s power in a way similar to the New York law in
Franklin, the Florida law was preempted.
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                      Opinion of the Court

   Barnett Bank also pointed to a second example of
significant interference—Fidelity Federal Savings & Loan
Association v. De la Cuesta, 

 (1982). In
Fidelity, federal law allowed, but did “not compel, federal
savings and loans to include due-on-sale clauses in their
contracts.” 

. But California law “limited” that
right to circumstances where the federal savings and loan
association could make a showing that enforcing the due-
on-sale clause was reasonably necessary. 

 at 154–155;
see also 

. The federal savings and loan
association could readily comply with both the state and
federal laws. 

. Still, the Court ruled that the
California law was preempted because the savings and loan
could not exercise a due-on-sale clause “solely at its option.”

 (internal quotation marks omitted). The California
law thus interfered with “the flexibility given” to the
savings and loan by federal law. 

 (internal quotation
marks omitted).
   For purposes of applying Dodd-Frank’s preemption
standard, Franklin, Fidelity, and Barnett Bank together
illustrate the kinds of state laws that significantly interfere
with the exercise of a national bank power and thus are
preempted.
                              C
  Of course, not all state laws regulating national banks
are preempted. As relevant here, Dodd-Frank preempts a
state law “only if” it “prevents or significantly interferes
with” national bank powers. §25b(b)(1)(B). To determine
the kinds of state-law interference that are not “significant”
and that are therefore not preempted, Barnett Bank again
scoured this Court’s precedents.
  First, Barnett Bank cited Anderson National Bank v.
Luckett, 

 (1944), as the primary example of a
case where state law was not preempted. There, Kentucky
law required banks to turn over abandoned deposits to the
10          CANTERO v. BANK OF AMERICA, N. A.

                     Opinion of the Court

State. 

. The Anderson Court stated that the
Kentucky law did not “not infringe or interfere with any
authorized function of the bank.” 

. Even though
national banks possess a federal power to collect deposits,
“an inseparable incident” of that power is the “obligation to
pay” the deposits “to the persons entitled to demand
payment according to the law of the state where it does
business.” 

 at 248–249. And Kentucky law simply
allowed the State to “demand payment of the accounts in
the same way and to the same extent that the depositors
could” after the depositors abandoned the account. 

. Therefore, the Anderson Court concluded, Kentucky
law did not “infringe the national banking laws or impose
an undue burden on the performance of the banks’
functions.” 

; see also 

.
  Anderson distinguished a seemingly similar California
law at issue in an earlier case, First National Bank of San
Jose v. California, 

 (1923), where the Court
had found the state law to be preempted.
  In First National Bank of San Jose, the California law
allowed the State to claim deposits that went “ ‘unclaimed
for more than twenty years.’ ” 

 Unlike Kentucky’s law,
however, California did not require proof that the account
was abandoned. Rather, the California law “attempt[ed] to
qualify in an unusual way agreements between national
banks and their customers.” 

. Therefore, the
Court noted, the California law could cause customers to
“hesitate” before depositing funds at the bank—and thus
interfere with the “efficiency” of the national bank in
receiving deposits. 

 at 369–370.
  Anderson’s reasons for differentiating the California law
at issue in First National Bank of San Jose help
demonstrate when a state law regulating national banks
crosses the line from permissible to preempted. In contrast
to the California law in First National Bank of San Jose,
the Kentucky law in Anderson demanded proof that the
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                     Opinion of the Court

accounts were abandoned—and thus its rule was “as old as
the common law itself.” 

. So the Kentucky
law could produce no such deterrent effect—and it could
apply to national banks. 

.
   Barnett Bank also cited two other examples of state laws
that could apply to national banks. In National Bank v.
Commonwealth, 

 (1870), the Court determined
that a Kentucky tax law was not preempted. The Kentucky
law at issue there taxed the shareholders of all banks
(including national banks) on their shares of bank stock.

. The Court explained that national banks are
“exempted from State legislation, so far as that legislation
may interfere with, or impair their efficiency in performing
the functions” that federal law authorizes them to perform.

. But national banks are not “wholly withdrawn
from the operation of State legislation”; rather, they remain
subject to state law governing “their daily course of
business” such as generally applicable state contract,
property, and debt-collection laws.         

 at 361–362.
Because the Kentucky tax “in no manner hinder[ed]” the
national bank’s banking operations, and produced “no
greater interference with the functions of the bank than any
other” law governing businesses, the law was not
preempted. 

 at 362–363.
   For similar reasons, the Court in McClellan v. Chipman,

 (1896), another example cited by Barnett
Bank, concluded that a generally applicable Massachusetts
contract law was not preempted as applied to national
banks. 164 U. S., at 357–358, 361. The Court noted that a
generally applicable contract law like Massachusetts’s
could be said to act as “a restraint upon the power of a
national bank within the State to make such contracts.”

. But even so, such state laws could apply to
national banks as long as the state laws did not “in any way
impai[r] the efficiency of national banks or frustrat[e] the
purpose for which they were created.” 

12             CANTERO v. BANK OF AMERICA, N. A.

                          Opinion of the Court

                              III
  In sum, Barnett Bank examined this Court’s precedents
to determine whether a state law regulating national banks
falls on the permissible or preempted side of the significant-
interference line. Those precedents furnish content to
Barnett Bank’s significant-interference test—and therefore
also to Dodd-Frank’s preemption standard incorporating
Barnett Bank.
  A court applying that Barnett Bank standard must make
a practical assessment of the nature and degree of the
interference caused by a state law. If the state law prevents
or significantly interferes with the national bank’s exercise
of its powers, the law is preempted. If the state law does
not prevent or significantly interfere with the national
bank’s exercise of its powers, the law is not preempted. In
assessing the significance of a state law’s interference,
courts may consider the interference caused by the state
laws in Barnett Bank, Franklin, Anderson, and the other
precedents on which Barnett Bank relied. If the state law’s
interference with national bank powers is more akin to the
interference in cases like Franklin, Fidelity, First National
Bank of San Jose, and Barnett Bank itself, then the state
law is preempted. If the state law’s interference with
national bank powers is more akin to the interference in
cases like Anderson, National Bank v. Commonwealth, and
McClellan, then the state law is not preempted.3
——————
   3 In Barnett Bank and each of the earlier precedents, the Court reached

its conclusions about the nature and degree of the state laws’ alleged
interference with the national banks’ exercise of their powers based on
the text and structure of the laws, comparison to other precedents, and
common sense. See, e.g., Barnett Bank of Marion Cty., N. A. v. Nelson,

, 33–35 (1996) (comparing Florida law at issue to New York
law in Franklin); Franklin National Bank of Franklin Square v. New
York, 

 (1954) (concluding that New York law interfered
with ability to use “a particular label” that federal law “specifically
selected”); First National Bank of San Jose v. California, 

 (1923) (reasoning that customers “might well hesitate” to subject
                      Cite as: 

 (2024)                     13

                           Opinion of the Court

   In analyzing the New York interest-on-escrow law at
issue here, the Court of Appeals did not conduct that kind
of nuanced comparative analysis. Instead, the Court of
Appeals relied on a line of cases going back to McCulloch v.
Maryland to distill a categorical test that would preempt
virtually all state laws that regulate national banks, at
least other than generally applicable state laws such as
contract or property laws. Bank of America supports the
Court of Appeals’ approach. By contrast, the plaintiffs
would yank the preemption standard to the opposite
extreme, and would preempt virtually no non-
discriminatory state laws that apply to both state and
national banks.
   We appreciate the desire by both parties for a clearer
preemption line one way or the other. But Congress
expressly incorporated Barnett Bank into the U. S. Code.
And in determining whether the Florida law at issue there
was preempted, Barnett Bank did not draw a bright line.
Instead, Barnett Bank sought to carefully account for and
navigate this Court’s prior bank preemption cases.
Applying those precedents, Barnett Bank ruled that some
(but not all) non-discriminatory state laws that regulate
national banks are preempted. Under Dodd-Frank, as
relevant here, courts may find a state law preempted “only
if,” “in accordance with the legal standard” from Barnett
Bank, the law “prevents or significantly interferes with the
exercise by the national bank of its powers.” §25b(b)(1)(B).
   Because the Court of Appeals did not analyze preemption
in a manner consistent with Dodd-Frank and Barnett Bank,
we vacate the judgment of the Court of Appeals and remand
——————
their deposits to “unusual” California law); Anderson National Bank v.
Luckett, 

, 247–248 (1944) (determining that no “word in the
national banking laws . . . expressly or by implication conflicts with the
provisions of the Kentucky statutes”); 

 at 249–252 (comparing the
likely effect of the Kentucky law to the likely effect of the California law
in First National Bank of San Jose).
14             CANTERO v. BANK OF AMERICA, N. A.

                          Opinion of the Court

the case for further proceedings consistent with this
opinion.4

                                                      It is so ordered.




——————
  4 During the course of the litigation, the parties have raised two other

issues that the Court of Appeals did not address and that it may address
as appropriate on remand: first, the significance here (if any) of the
preemption rules of the Office of the Comptroller of the Currency; and
second, the relevance here (if any) of the Dodd-Frank provision that
preempts state consumer financial laws if a federal law “other than title
62 of the Revised Statutes” preempts the state law, 12 U. S. C.
§25b(b)(1)(C).