Marquette Bank Minneapolis

Marquette Bank Minneapolis, formerly named the Marquette National Bank, was a bank in Minneapolis, Minnesota. It was party to Marquette National Bank of Minneapolis v. First of Omaha Service Corp., an important decision by the Supreme Court of the United States which regulated the banking industry.

Marquette Bank Minneapolis
FormerlyMarquette National Bank (1920–1982)
TypeSubsidiary
IndustryBanking
FateAcquired by First Bank System
SuccessorFirst Bank System
Founded1920 (1920) in Minneapolis, Minnesota as Marquette National Bank
DefunctDecember 31, 1992 (1992-12-31)
HeadquartersMinneapolis, Minnesota
Number of locations
22
Area served
Minneapolis–Saint Paul
Key people
Carl Pohlad
ParentBank Shares, Inc.

History

Originally named the Marquette National Bank, it was chartered in 1920 and was named for Marquette Avenue, the financial center of Minneapolis, Minnesota.

The bank was eventually acquired by Carl Pohlad and had $350 million in assets in 1982 when it acquired the failing Farmers and Mechanics Savings Bank of Minneapolis (F&M) and had nearly $1 billion of assets prior to sale which was arranged by the Federal Deposit Insurance Corporation. After the acquisition, the name was changed to Marquette Bank Minneapolis and it had the fourth most assets in the state. The bank was owned by the Bank Shares, Inc. holding company which was controlled by the Pohlad family and which owned several other banks in the Minneapolis area using the Marquette name.

Bank Shares announced the sale to First Bank System (now US Bank) in January 1992[1] with the deal finally closing in December 1992 for $200 million in stock.[2]

Interest rate battle

Marquette was involved in lengthy credit card interest rate litigation with the First National Bank of Omaha which resulted in an important US Supreme Court ruling regulating the banking industry. Marquette brought suit against First National, claiming the interest rate charged Minnesotan customers using First National credit card services (VISA), though legal in Nebraska, exceeded the interest rate allowed under Minnesota state law. Marquette was also issuing cards but did not exceed the interest rate permitted by the law in the cardholder's state. The court ruled in 1978 that a federally chartered bank like First National could offer credit card services nationwide and the maximum interest rate to cardholders was that allowed by the state the bank was located in and not the customer's state. This ruling prompted some US states (South Dakota, Delaware, Utah, Virginia, New Hampshire) to repeal their maximum interest rate laws. Banks offering credit card services quickly established offices and cardholder services in those States to take advantage of the "no cap" interest rates allowed by the state.

References
  1. St. Anthony, Neal & Kennedy, Tony (January 17, 1992). "FBS to buy Pohlad banks - Proposed First Bank-Marquette deal would be largest in Twin Cities history". Minneapolis Star-Tribune. p. 01A. First Bank System reached preliminary agreement Thursday to buy Carl Pohlad's Marquette Bank Minneapolis and Marquette Bank Rochester in a $230 million stock deal. The proposed merger, the biggest in Twin Cities banking history, would make Pohlad the second-largest owner of First Bank common stock. Under terms of the deal, Pohlad would get 9.4 million shares of FBS stock valued at $24.50 per share in return for all of the shares in Bank Shares Inc., the privately held holding company that owns Marquette Bank Minneapolis and Marquette Bank Rochester. Marquette Bank Minneapolis includes 22 offices; Marquette Bank Rochester operates five. The sale does not include 10 other Marquette banks in Minnesota with 17 offices. Pohlad, 76, would retain an estimated $2.1 billion in banking assets in nine states. He could not be reached for comment last night. The deal, which must be approved by regulators and Bank Shares shareholders, is expected to close next fall.
  2. "Bank Acquisition Complete". St. Paul Pioneer Press. January 1, 1993. p. 9C. First Bank System said Thursday it has completed its previously announced acquisition of Bank Shares Inc. and its 22 Marquette Bank locations in the Twin Cities area with $2.1 billion in assets. Terms were not disclosed. The $22.5 billion-asset First Bank System has said it will close three First Bank and seven Marquette Minneapolis offices by mid-1993, leaving it with 58 Twin Cities offices. First Bank terminated some Marquette Minneapolis employees in December.
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