517 U.S. 25 (1996)

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

[26] Breyer, J., delivered the opinion for a unanimous Court.

Nathan Lewin argued the cause and filed briefs for petitioner. With him on the briefs were Scott L. Nelson, James R. Heavner, Jr., and Richard E. Swartley.

Richard P. Bress argued the cause for the United States et al. as amici curiae urging reversal. With him on the brief were Solicitor General Days, Assistant Attorney General Hunger, Deputy Solicitor General Bender, Edward C. DuMont, Anthony J. Steinmeyer, Jacob M. Lewis, Julie L. [27] Williams, L. Robert Griffin, Ernest C. Barrett III, and Joan M. Bernott.

Daniel Y. Sumner argued the cause and filed a brief for respondents Bill Nelson et al. With him on the brief were David J. Busch, Dennis Silverman, and Karen Asher-Cohen. Ann M. Kappler argued the cause and filed a brief for respondents Florida Association of Life Underwriters et al. With her on the brief were Scott A. Sinder, Sam Hirsch, Bruce J. Ennis, Jr., Paul M. Smith, and Donald B. Verrilli, Jr.^[1]

Justice Breyer, delivered the opinion of the Court.

The question in this case is whether a federal statute that permits national banks to sell insurance in small towns preempts a state statute that forbids them to do so. To answer this question, we must consider both ordinary pre-emption principles, and also a special federal anti-pre-emption rule, which provides that a federal statute will not pre-empt a [28] state statute enacted "for the purpose of regulating the business of insurance"—unless the federal statute "specifically relates to the business of insurance. " McCarran-Ferguson Act, 15 U. S. C. § 1012(b) (emphasis added). We decide that the McCarran-Ferguson Act's special anti-pre-emption rule does not govern this case, because the federal statute in question "specifically relates to the business of insurance." We conclude that, under ordinary pre-emption principles, the federal statute pre-empts the state statute, thereby prohibiting application of the state statute to prevent a national bank from selling insurance in a small town.

I

In 1916 Congress enacted a federal statute that says that certain national banks "may" sell insurance in small towns. It provides in relevant part:

"In addition to the powers now vested by law in national [banks] organized under the laws of the United States any such [bank] located and doing business in any place [with a population] . . . [of not more than] five thousand . . . may, under such rules and regulations as may be prescribed by the Comptroller of the Currency, act as the agent for any fire, life, or other insurance company authorized by the authorities of the State . . . to do business [there], . . . by soliciting and selling insurance . . . Provided, however, That no such bank shall . . . guarantee the payment of any premium . . . And provided further, That the bank shall not guarantee the truth of any statement made by an assured [when applying] . . . for insurance." Act of Sept. 7, 1916 (Federal Statute), 39 Stat. 753, as amended, 12 U. S. C. § 92 (emphases changed).

In 1974 Florida enacted a statute that prohibits certain banks from selling most kinds of insurance. It says:

[29] "No [Florida licensed] insurance agent . . . who is associated with, . . . owned or controlled by . . . a financial institution shall engage in insurance agency activities . . . ." Fla. Stat. § 626.988(2) (Supp. 1996) (State Statute).

The term "financial institution" includes

"any bank . . . [except for a] bank which is not a subsidiary or affiliate of a bank holding company and is located in a city having a population of less than 5,000 . . . ." § 626.988(1)(a).

Thus, the State Statute says, in essence, that banks cannot sell insurance in Florida—except that an unaffiliated small town bank (i. e., a bank that is not affiliated with a bank holding company) may sell insurance in a small town. Ibid.

In October 1993 petitioner Barnett Bank, an "affiliate[d]" national bank which does business through a branch in a small Florida town, bought a Florida licensed insurance agency. The Florida State Insurance Commissioner, pointing to the State Statute (and noting that the unaffiliated small town bank exception did not apply), ordered Barnett's insurance agency to stop selling the prohibited forms of insurance. Barnett, claiming that the Federal Statute pre-empted the State Statute, then filed this action for declaratory and injunctive relief in federal court.

The District Court held that the Federal Statute did not pre-empt the State Statute, but only because of the special insurance-related federal anti-pre-emption rule. The McCarran-Ferguson Act, which creates that rule, says:

"No act of Congress shall be construed to invalidate, impair, or supersede any law enacted by any State for the purpose of regulating the business of insurance, or which imposes a fee or tax upon such business, unless such Act specifically relates to the business of insurance. . . ." McCarran-Ferguson Act, § 2(b), 59 Stat. 34, 15 U. S. C. § 1012(b).

[30] The District Court decided both (1) that the Federal Statute did not fall within the McCarran-Ferguson Act's exception because it did not "specifically relat[e] to the business of insurance"; and (2) that the State Statute was a "law enacted. . . for the purpose of regulating the business of insurance." Barnett Bank of Marion County, N. A. v. Gallagher, 839 F. Supp. 835, 840-841, 843 (MD Fla. 1993) (internal quotation marks omitted). Consequently, the McCarran-Ferguson Act, in the District Court's view, instructs courts not to "constru[e]" the Federal Statute "to invalidate" the State Statute. 15 U. S. C. § 1012(b). The Eleventh Circuit Court of Appeals, for similar reasons, agreed that the Federal Statute did not pre-empt the State Statute. Barnett Bank of Marion County, N. A. v. Gallagher, 43 F. 3d 631, 634-637 (1995).

We granted certiorari due to uncertainty among lower courts about the pre-emptive effect of this Federal Statute. See Owensboro Nat. Bank v. Stephens, 44 F. 3d 388 (CA6 1994) (pre-emption of Kentucky statute that prevents national banks from selling insurance in small towns); First Advantage Ins., Inc. v. Green, 652 So. 2d 562 (La. Ct. App.), cert. and review denied, 654 So. 2d 331 (1995) (no preemption). We now reverse the Eleventh Circuit.

II

We shall put the McCarran-Ferguson Act's special antipre-emption rule to the side for the moment, and begin by asking whether, in the absence of that rule, we should construe the Federal Statute to pre-empt the State Statute. This question is basically one of congressional intent. Did Congress, in enacting the Federal Statute, intend to exercise its constitutionally delegated authority to set aside the laws of a State? If so, the Supremacy Clause requires courts to follow federal, not state, law. U. S. Const., Art. VI, cl. 2; see California Fed. Sav. & Loan Assn. v. Guerra, 479 U. S. 272, 280-281 (1987) (reviewing pre-emption doctrine).

[31] Sometimes courts, when facing the pre-emption question, find language in the federal statute that reveals an explicit congressional intent to pre-empt state law. E. g., Jones v. Rath Packing Co., 430 U. S. 519, 525, 530-531 (1977). More often, explicit pre-emption language does not appear, or does not directly answer the question. In that event, courts must consider whether the federal statute's "structure and purpose," or nonspecific statutory language, nonetheless reveal a clear, but implicit, pre-emptive intent. Id., at 525; Fidelity Fed. Sav. & Loan Assn. v. De la Cuesta, 458 U. S. 141, 152-153 (1982). A federal statute, for example, may create a scheme of federal regulation "so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it." Rice v. Santa Fe Elevator Corp., 331 U. S. 218, 230 (1947). Alternatively, federal law may be in "irreconcilable conflict" with state law. Rice v. Norman Williams Co., 458 U. S. 654, 659 (1982). Compliance with both statutes, for example, may be a "physical impossibility," Florida Lime & Avocado Growers, Inc. v. Paul, 373 U. S. 132, 142-143 (1963); or, the state law may "stan[d] as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Hines v. Davidowitz, 312 U. S. 52, 67 (1941).

In this case we must ask whether or not the Federal and State Statutes are in "irreconcilable conflict." The two statutes do not impose directly conflicting duties on national banks—as they would, for example, if the federal law said, "you must sell insurance," while the state law said, "you may not." Nonetheless, the Federal Statute authorizes national banks to engage in activities that the State Statute expressly forbids. Thus, the State's prohibition of those activities would seem to "stan[d] as an obstacle to the accomplishment" of one of the Federal Statute's purposes—unless, of course, that federal purpose is to grant the bank only a very limited permission, that is, permission to sell insurance to the extent that state law also grants permission to do so.

[32] That is what the State of Florida and its supporting amici argue. They say that the Federal Statute grants national banks a permission that is limited to circumstances where state law is not to the contrary. In their view, the Federal Statute removes only federal legal obstacles, not state legal obstacles, to the sale of insurance by national banks. But we do not find this, or the State's related, ordinary preemption arguments, convincing.

For one thing, the Federal Statute's language suggests a broad, not a limited, permission. That language says, without relevant qualification, that national banks "may . . . act as the agent" for insurance sales. 12 U. S. C. § 92. It specifically refers to "rules and regulations" that will govern such sales, while citing as their source not state law, but the federal Comptroller of the Currency. Ibid. It also specifically refers to state regulation, while limiting that reference to licensing—not of banks or insurance agents, but of the insurance companies whose policies the bank, as insurance agent, will sell. Ibid.

For another thing, the Federal Statute says that its grant of authority to sell insurance is in"addition to the powers now vested by law in national [banks]." Ibid. (emphasis added). In using the word "powers," the statute chooses a legal concept that, in the context of national bank legislation, has a history. That history is one of interpreting grants of both enumerated and incidental "powers" to national banks as grants of authority not normally limited by, but rather ordinarily pre-empting, contrary state law. See, e. g., First Nat. Bank of San Jose v. California, 262 U. S. 366, 368-369 (1923) (national banks' "power" to receive deposits pre-empts contrary state escheat law); Easton v. Iowa, 188 U. S. 220, 229-230 (1903) (national banking system normally "independent, so far as powers conferred are concerned, of state legislation"); cf. Waite v. Dowley, 94 U. S. 527, 533 (1877) ("[W]here there exists a concurrent right of legislation in the States and in Congress, and the latter has exercised its [33] power, there remains in the States no authority to legislate on the same matter").

Thus, this Court, in a case quite similar to this one, held that a federal statute permitting, but not requiring, national banks to receive savings deposits pre-empts a state statute prohibiting certain state and national banks from using the word "savings" in their advertising. Franklin Nat. Bank of Franklin Square v. New York, 347 U. S. 373, 375-379 (1954) (Federal Reserve Act provision that national banks "may continue . . . to receive . . . savings deposits" read as "declaratory of the right of a national bank to enter into or remain in that type of business"). See also De la Cuesta, supra, at 154-159 (federal regulation permitting, but not requiring, national banks to include in mortgage contracts a debt accelerating "due on sale" clause pre-empts a state law forbidding the use of such a clause); cf. Lawrence County v. LeadDeadwood School Dist. No. 40-1, 469 U. S. 256 (1985) (federal statute providing that local government units "may" expend federal funds for any governmental purpose pre-empts state law restricting their expenditure).

In defining the pre-emptive scope of statutes and regulations granting a power to national banks, these cases take the view that normally Congress would not want States to forbid, or to impair significantly, the exercise of a power that Congress explicitly granted. To say this is not to 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. See, e. g., Anderson Nat. Bank v. Luckett, 321 U. S. 233, 247-252 (1944) (state statute administering abandoned deposit accounts did not "unlawful[ly] encroac[h] on the rights and privileges of national banks"); McClellan v. Chipman, 164 U. S. 347, 358 (1896) (application to national banks of state statute forbidding certain real estate transfers by insolvent transferees would not "destro[y] or hampe[r]" national banks' functions); National Bank v. Commonwealth, 9 Wall. 353, 362 (1870) [34] (national banks subject to state law that does not "interfere with, or impair [national banks'] efficiency in performing the functions by which they are designed to serve [the Federal] Government").

Nor do these cases control the interpretation of federal banking statutes that accompany a grant of an explicit power with an explicit statement that the exercise of that power is subject to state law. See, e. g., 12 U. S. C. § 36(c) (McFadden Act) (authorizing national banks to operate branches, but only where state law authorizes state banks to do so); § 92a(a) (Comptroller of Currency may grant fiduciary powers "by special permit to national banks applying therefor, when not in contravention of State or local law"). Not surprisingly, this Court has interpreted those explicit provisions to mean what they say. See, e. g., First Nat. Bank in Plant City v. Dickinson, 396 U. S. 122, 131 (1969) (under McFadden Act, state branching restrictions apply to national banks); First Nat. Bank of Logan v. Walker Bank & Trust Co., 385 U. S. 252, 260-261 (1966) (same); see also Van Allen v. Assessors, 3 Wall. 573, 586 (1866) (enforcing 1864 amendments to National Bank Act expressly authorizing state taxation of national bank shares).

But, as we pointed out, supra, at 32-33, where Congress has not expressly conditioned the grant of "power" upon a grant of state permission, the Court has ordinarily found that no such condition applies. In Franklin Nat. Bank, the Court made this point explicit. It held that Congress did not intend to subject national banks' power to local restrictions, because the federal power-granting statute there in question contained "no indication that Congress [so] intended. . . as it has done by express language in several other instances." 347 U. S., at 378, and n. 7 (emphasis added) (collecting examples).

The Federal Statute before us, as in Franklin Nat. Bank, explicitly grants a national bank an authorization, permission, or power. And, as in Franklin Nat. Bank, it contains [35] no "indication" that Congress intended to subject that power to local restriction. Thus, the Court's discussion in Franklin Nat. Bank, the holding of that case, and the other precedent we have cited above, strongly argue for a similar interpretation here—a broad interpretation of the word "may" that does not condition federal permission upon that of the State.

Finally, Florida and its supporters challenge this interpretation by arguing that special circumstances surrounding the enactment of the Federal Statute nonetheless demonstrate Congress' intent to grant only a limited permission (subject to state approval). They point to a letter to Congress written by the Comptroller of the Currency in 1916. The Comptroller attached a draft of what became the Federal Statute, and the letter explains to Congress why the Comptroller wants Congress to enact his proposal. The letter says that, since 1900, many small town national banks had failed; that some States had authorized small town state banks to sell insurance; that providing small town national banks with authority to sell insurance would help them financially; and that doing so would also improve their competitive position vis-à-vis state banks. The relevant language in the letter (somewhat abridged) reads as follows:

"[Since 1900, of 3,084 small national banks, 438] have either failed or gone into liquidation. . . . [T]here are many banks located in [small towns] . . . where the small deposits which the banks receive may make it somewhat difficult [to earn] . . . a satisfactory return . . . .

"For some time I have been giving careful consideration to the question as to how the powers of these small national banks might be enlarged so as to provide them with additional sources of revenue and place them in a position where they could better compete with local State banks and trust companies which are sometimes [36] authorized under the law to do a class of business not strictly that of commercial banking. . . .

"[The federal banking laws, while granting national banks certain "incidental powers," do not give them] either expressly nor by necessary implication the power to act as agents for insurance companies. . . .

. . . . .

"My investigations lead me respectfully to recommend to Congress an amendment to the national-bank act by which national banks located in [small towns] . . . may be permitted to act as agents for insurance companies . . . .

"It seems desirable from the standpoint of public policy and banking efficiency that this authority should be limited to banks in small communities. This additional income will strengthen them and increase their ability to make a fair return . . . .

"I think it would be unwise and therefore undesirable to confer this privilege generally upon banks in large cities where the legitimate business of banking affords ample scope for the energies of trained and expert bankers . . . .

"I inclose . . . a draft . . . designed to empower national banks located in [small] towns . . . under such regulations and restrictions as may from time to time be approved and promulgated by the Comptroller of the Currency, to act as agents for the placing of insurance policies . . . ." 53 Cong. Rec. 11001 (1916) (letter from Comptroller Williams to the Chairman of the Senate Bank and Currency Committee).

Assuming for argument's sake that this letter is relevant, and in response to the arguments of Florida and its supporters, we point out that the letter does not significantly advance their cause. Although the letter mentions that enlarging the powers of small national banks will help them "better compete with local State banks," it primarily focuses upon small town national banks' need for added revenue— [37] an objective met by a broad insurance-selling authority that is not limited by state law. The letter refers to limitations that federal regulation might impose, but it says nothing about limitations imposed by state regulation or state law. The letter makes clear that authority to sell insurance in small towns is an added "incidental power" of a national bank—a term that, in light of this Court's then-existing cases, suggested freedom from conflicting state regulation. See Easton, 188 U. S., at 229-230; First Nat. Bank of San Jose, 262 U. S., at 368-369. The letter sets forth as potential objections to the proposal (or to its extension to larger national banks) concerns about distracting banking management or inhibiting the development of banking expertise— not concerns related to state regulatory control.

We have found nothing elsewhere in the Federal Statute's background or history that significantly supports the State's arguments. And as far as we are aware, the Comptroller's subsequent interpretation of the Federal Statute does not suggest that the statute provides only a limited authority subject to similar state approval. Cf. 12 CFR § 7.7100 (1995); OCC Interpretive Letter No. 366, CCH Fed. Banking L. Rep. ¶ 85,536, p. 77,833 (1986).

In light of these considerations, we conclude that the Federal Statute means to grant small town national banks authority to sell insurance, whether or not a State grants its own state banks or national banks similar approval. Were we to apply ordinary legal principles of pre-emption, the federal law would pre-empt that of the State.

III

We now must decide whether ordinary legal principles of pre-emption, or the special McCarran-Ferguson Act antipre-emption rule, governs this case. The lower courts held that the McCarran-Ferguson Act's special anti-pre-emption rule applies, and instructs courts not to "construe" the Federal Statute to "invalidate, impair, or supersede" that of the [38] State. 15 U. S. C. § 1012(b). By its terms, however, the Act does not apply when the conflicting federal statute "specifically relates to the business of insurance. " Ibid. (emphasis added). In our view, the Federal Statute in this case "specifically relates to the business of insurance"—therefore the McCarran-Ferguson Act's special anti-pre-emption rule does not apply.

Our conclusion rests upon the McCarran-Ferguson Act's language and purpose, taken together. Consider the language—"specifically relates to the business of insurance." In ordinary English, a statute that says that banks may act as insurance agents, and that the Comptroller of the Currency may regulate their insurance-related activities, "relates " to the insurance business. The word "relates" is highly general, and this Court has interpreted it broadly in other pre-emption contexts. See, e. g., Pilot Life Ins. Co. v. Dedeaux, 481 U. S. 41, 47 (1987) (words "`relate to' " have "`broad common-sense meaning, such that a state law "relate[s] to" a benefit plan ". . . if it has a connection with or reference to such a plan"` ") (quoting Metropolitan Life Ins. Co. v. Massachusetts , 471 U. S. 724, 739 (1985), in turn quoting Shaw v. Delta Air Lines, Inc., 463 U. S. 85, 97 (1983)); Morales v. Trans World Airlines, Inc., 504 U. S. 374, 383-384 (1992) (interpreting similarly the words "`relating to' " in the Airline Deregulation Act of 1978).

More importantly, in ordinary English, this statute "specifically " relates to the insurance business. "Specifically" can mean "explicitly, particularly, [or] definitely," Black's Law Dictionary 1398 (6th ed. 1990), thereby contrasting a specific reference with an implicit reference made by more general language to a broader topic. The general words "business activity," for example, will sometimes include, and thereby implicitly refer, to insurance; the particular words "finance, banking, and insurance" make that reference explicitly and specifically.

[39] Finally, using ordinary English, one would say that this statute specifically relates to the "business of insurance. " The statute explicitly grants national banks permission to "act as the agent for any fire, life, or other insurance company," to "solici[t] and sel[l] insurance," to "collec[t] premiums," and to "receive for services so rendered .. . fees or commissions," subject to Comptroller regulation. 12 U. S. C. § 92. It also sets forth certain specific rules prohibiting banks from guaranteeing the "payment of any premium on insurance policies issued through its agency . . ." and the "truth of any statement made by an assured in filing his application for insurance." Ibid. The statute thereby not only focuses directly upon industry-specific selling practices, but also affects the relation of insured to insurer and the spreading of risk—matters that this Court, in other contexts, has placed at the core of the McCarran-Ferguson Act's concern. See Union Labor Life Ins. Co. v. Pireno, 458 U. S. 119, 129 (1982) (citing Group Life & Health Ins. Co. v. Royal Drug Co., 440 U. S. 205 (1979); see also Department of Treasury v. Fabe, 508 U. S. 491, 502-504 (1993).

Consider, too, the McCarran-Ferguson Act's basic purposes. The Act sets forth two mutually reinforcing purposes in its first section, namely, that "continued regulation and taxation by the several States of the business of insurance is in the public interest," and that "silence on the part of the Congress shall not be construed to impose any barrier to the regulation or taxation of such business by the several States." 15 U. S. C. § 1011 (emphasis added). The latter phrase, particularly the word "silence," indicates that the Act does not seek to insulate state insurance regulation from the reach of all federal law. Rather, it seeks to protect state regulation primarily against inadvertent federal intrusion— say, through enactment of a federal statute that describes an affected activity in broad, general terms, of which the insurance business happens to constitute one part.

[40] The circumstances surrounding enactment of the McCarran-Ferguson Act suggest the same. Just prior to the law's enactment, this Court, in United States v. SouthEastern Underwriters Assn., 322 U. S. 533 (1944), held that a federal antitrust law, the Sherman Act, applied to the business of insurance. The Sherman Act's highly general language said nothing specifically about insurance. See 15 U. S. C. § 1 (forbidding every "contract, combination . . . or conspiracy, in restraint of trade or commerce among the several States"). The Sherman Act applied only to activities in or affecting interstate commerce. Hopkins v. United States, 171 U. S. 578, 586 (1898). Many lawyers and insurance professionals had previously thought (relying, in part, on this Court's opinion in Paul v. Virginia, 8 Wall. 168, 183 (1869), and other cases) that the issuance of an insurance policy was not a "transaction of commerce," and therefore fell outside the Sherman Act's scope. South-Eastern Underwriters told those professionals that they were wrong about interstate commerce, and that the Sherman Act did apply. And South-Eastern Underwriters' principle meant, consequently, that other generally phrased congressional statutes might also apply to the issuance of insurance policies, thereby interfering with state regulation of insurance in similarly unanticipated ways.

In reaction to South-Eastern Underwriters, Congress "moved quickly," enacting the McCarran-Ferguson Act "to restore the supremacy of the States in the realm of insurance regulation." Fabe, supra, at 500. But the circumstances we have just described mean that "restor[ation] " of "supremacy" basically required setting aside the unanticipated effects of South-Eastern Underwriters, and cautiously avoiding similar unanticipated interference with state regulation in the future. It did not require avoiding federal preemption by future federal statutes that indicate, through their "specific relat[ion]" to insurance, that Congress had focused upon the insurance industry, and therefore, in all [41] likelihood, consciously intended to exert upon the insurance industry whatever pre-emptive force accompanied its law. See also, e. g., insofar as relevant, 91 Cong. Rec. 483 (1945) (statement of Sen. O'Mahoney, floor manager of the Act, that the Act was intended to be "a sort of catch-all provision to take into consideration other acts of Congress which might affect the insurance industry, but of which we did not have knowledge at the time"); ibid. (similar statement of Sen. Ferguson).

The language of the Federal Statute before us is not general. It refers specifically to insurance. Its state regulatory implications are not surprising, nor do we believe them inadvertent. See Part II, supra. Consequently, considerations of purpose, as well as of language, indicate that the Federal Statute falls within the scope of the McCarranFerguson Act's "specifically relates" exception to its antipre-emption rule. Cf. John Hancock Mut. Life Ins. Co. v. Harris Trust and Sav. Bank, 510 U. S. 86, 98 (1993) (adopting the United States' view that language in the Employee Retirement Income Security Act of 1974 defining a "guaranteed benefit policy" as a certain kind of "insurance" policy "obviously and specifically relates to the business of insurance") (internal quotation marks omitted).

We shall mention briefly why we are not convinced by several of the parties' remaining arguments. Florida says that the Federal Statute "specifically relates" to banking, not to insurance. But a statute may specifically relate to more than one thing. Just as an ordinance forbidding dogs in city parks specifically relates to dogs and to parks, so a statute permitting banks to sell insurance can specifically relate to banks and to insurance. Neither the McCarran-Ferguson Act's language, nor its purpose, requires the Federal Statute to relate predominantly to insurance. To the contrary, specific detailed references to the insurance industry in proposed legislation normally will achieve the McCarranFerguson Act's objectives, for they will call the proposed legislation [42] to the attention of interested parties, and thereby normally guarantee, should the proposal become law, that Congress will have focused upon its insurance-related effects.

An amicus argues that our interpretation would give the Act "little meaning," because "whenever a state statute `regulates' the business of insurance, any conflicting federal statute necessarily will `specifically relate' to the insurance business." Brief for American Council of Life Insurance as Amicus Curiae 4. We disagree. Many federal statutes with potentially pre-emptive effect, such as the bankruptcy statutes, use general language that does not appear to "specifically relate" to insurance; and where those statutes conflict with state law that was enacted "for the purpose of regulating the business of insurance," the McCarran-Ferguson Act's anti-pre-emption rule will apply. See generally Fabe, supra, at 501 (noting the parties' agreement that federal bankruptcy priority rules, although conflicting with state law, do not "specifically relate" to the business of insurance).

The lower courts argued that the Federal Statute's 1916 date of enactment was significant, because Congress would have then believed that state insurance regulation was beyond its "Commerce Clause" power to affect. The lower courts apparently thought that Congress therefore could not have intended the Federal Statute to pre-empt contrary state law. The short answer to this claim is that there is no reason to think that Congress believed state insurance regulation beyond its constitutional powers to affect—insofar as Congress exercised those powers to create, to empower, or to regulate national banks. See McCulloch v. Maryland, 4 Wheat. 316 (1819); Farmers' and Mechanics' Nat. Bank v. Dearing, 91 U. S. 29, 33 (1875); see also, e. g., Easton v. Iowa, 188 U. S., at 238. We have explained, see Part II, supra, why we conclude that Congress indeed did intend the Federal Statute to pre-empt conflicting state law.

[43] Finally, Florida points to language in Fabe, which states that the McCarran-Ferguson Act "imposes what is, in effect, a clear-statement rule" that forbids pre-emption "unless a federal statute specifically requires otherwise." 508 U. S., at 507. Florida believes that this statement in Fabe means that the Federal Statute would have to use the words "state law is pre-empted," or the like, in order to fall within the McCarran-Ferguson Act exception. We do not believe, however, that Fabe imposes any such requirement. Rather, the quoted language in Fabe was a general description of the Act's effect. It simply pointed to the existence of the clause at issue here—the exception for federal statutes that "specifically relat[e] to the business of insurance." But it did not purport authoritatively to interpret the "specifically relates" clause. That matter was not at issue in Fabe. We therefore believe that Fabe does not require us to reach a different result here.

For these reasons, the judgment of the Court of Appeals is reversed.

It is so ordered.

[1] Briefs of amici curiae urging reversal were filed for the American Bankers Association et al. by John J. Gill III, Michael F. Crotty, Mathew H. Street, Richard M. Whiting, Leonard J. Rubin, M. Thurman Senn, and David L. Glass; for American Deposit Corp. et al. by Thaddeus Holt and Dennis M. Gingold; for the Consumer Bankers Association et al. by David W. Roderer, Eric L. Hirschhorn, Donn C. Meindertsma, John W. Anderson, and Jeffrey D. Quayle; for the Florida Bankers Association by J. Thomas Cardwell and Virginia B. Townes; and for the New York Clearing House Association by Bruce E. Clark, Michael M. Wiseman, and Norman R. Nelson.

Briefs of amici curiae urging affirmance were filed for the American Council of Life Insurance by David Overlock Stewart, James M. Lichtman, Gary E. Hughes, and Phillip E. Stano; for the Council of Insurance Agents and Brokers by Mark E. Herlihy; for the National Association of Insurance Commissioners by Ellen Dollase Wilcox; for the National Conference of State Legislatures et al. by Richard Ruda, Lee Fennell, and Arthur E. Wilmarth, Jr.; and for Don W. Stephens et al. by Stephen B. Cox, Suetta W. Dickinson, Julie A. Fuselier, Richard Blumenthal, Attorney General of Connecticut, and John G. Haines, Assistant Attorney General.

[2714] Barbara D. Underwood, New York, NY, for petitioner.

Malcolm L. Stewart, Washington, DC, for respondent Office of Comptroller of the Currency.

Seth P. Waxman, Washington, DC, for respondent The Clearing House Association, L.L.C.

Andrew M. Cuomo, Attorney General of the State of New York, Barbara D. Underwood, Counsel of Record, Solicitor General, Michelle Aronowitz, Deputy Solicitor General, Richard Dearing, Assistant Solicitor General, New York, NY, for petitioner.

Julie L. Williams, First Senior Deputy Comptroller and Chief Counsel, Daniel P. Stipano, Deputy Chief Counsel, Horace G. Sneed, Douglas B. Jordan, Attorneys, Office of the Comptroller of the Currency, Washington, D.C., Elena Kagan, Solicitor General, Counsel of Record, Malcolm L. Stewart, Deputy Solicitor General, Matthew D. Roberts, Assistant to the Solicitor General, Department of Justice, Washington, D.C., for Federal respondent.

H. Rodgin Cohen, Robinson B. Lacy, Michael M. Wiseman, Adam R. Brebner, Sullivan & Cromwell LLP, New York, NY, Seth P. Waxman, Counsel of Record, Edward C. DuMont, Catherine M.A. Carroll, Christopher E. Babbitt, Wilmer Cutler Pickering, Hale and Dorr LLP, Washington, DC, Christopher R. Lipsett, Noah A. Levine, Anne K. Small, Lauren E. Baer, Wilmer Cutler Pickering, Hale and Dorr LLP, New York, NY, for respondent The Clearing House Association L.L.C.

Justice SCALIA delivered the opinion of the Court.

In 2005, Eliot Spitzer, Attorney General for the State of New York, sent letters to several national banks making a request "in lieu of subpoena" that they provide certain non-public information about their lending practices. He sought this information to determine whether the banks had violated the State's fair-lending laws. Spitzer's successor in office, Andrew Cuomo, is the petitioner here. Respondents, the federal Office of the Comptroller of the Currency ("Comptroller" or "OCC") and the Clearing House Association, a banking trade group, brought suit to enjoin the information request, claiming that the Comptroller's regulation promulgated under the National Bank Act prohibits that form of state law enforcement against national banks.

The United States District Court for the Southern District of New York entered an injunction in favor of respondents, prohibiting the attorney general from enforcing state fair-lending laws through demands for records or judicial proceedings. The United States Court of Appeals for the Second Circuit affirmed. 510 F.3d 105 (2007). We granted certiorari. 555 U.S. ___, 129 S.Ct. 987, 173 L.Ed.2d 171 (2009). The question presented is whether [2715] the Comptroller's regulation purporting to pre-empt state law enforcement can be upheld as a reasonable interpretation of the National Bank Act.

I

Section 484(a) of Title 12, U.S.C., a provision of the National Bank Act, 13 Stat. 99, reads as follows:

"No national bank shall be subject to any visitorial powers except as authorized by Federal law, vested in the courts of justice or such as shall be, or have been exercised or directed by Congress or by either House thereof or by any committee of Congress or of either House duly authorized."

The Comptroller, charged with administering the National Bank Act, adopted, through notice-and-comment rulemaking, the regulation at issue here designed to implement the statutory provision. Its principal provisions read as follows:

"§ 7.4000 Visitorial powers.

"(a) General rule. (1) Only the OCC or an authorized representative of the OCC may exercise visitorial powers with respect to national banks, except as provided in paragraph (b) of this section. State officials may not exercise visitorial powers with respect to national banks, such as conducting examinations, inspecting or requiring the production of books or records of national banks, or prosecuting enforcement actions, except in limited circumstances authorized by federal law. However, production of a bank's records (other than non-public OCC information under 12 CFR part 4, subpart C) may be required under normal judicial procedures.

"(2) For purposes of this section, visitorial powers include:

"(i) Examination of a bank;

"(ii) Inspection of a bank's books and records;

"(iii) Regulation and supervision of activities authorized or permitted pursuant to federal banking law; and

"(iv) Enforcing compliance with any applicable federal or state laws concerning those activities." 12 CFR § 7.4000 (2009).

By its clear text, this regulation prohibits the States from "prosecuting enforcement actions" except in "limited circumstances authorized by federal law."

Under the familiar Chevron framework, we defer to an agency's reasonable interpretation of a statute it is charged with administering. Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). There is necessarily some ambiguity as to the meaning of the statutory term "visitorial powers," especially since we are working in an era when the prerogative writs—through which visitorial powers were traditionally enforced— are not in vogue. The Comptroller can give authoritative meaning to the statute within the bounds of that uncertainty. But the presence of some uncertainty does not expand Chevron deference to cover virtually any interpretation of the National Bank Act. We can discern the outer limits of the term "visitorial powers" even through the clouded lens of history. They do not include, as the Comptroller's expansive regulation would provide, ordinary enforcement of the law. Evidence from the time of the statute's enactment, a long line of our own cases, and application of normal principles of construction to the National Bank Act make that clear.

A

Historically, the sovereign's right of visitation over corporations paralleled the right of the church to supervise its institutions and the right of the founder of a [2716] charitable institution "to see that [his] property [was] rightly employed," 1 W. Blackstone, Commentaries on the Laws of England 469 (1765). By extension of this principle, "[t]he king [was] by law the visitor of all civil corporations," ibid. A visitor could inspect and control the visited institution at will.

When the National Bank Act was enacted in 1864, "visitation" was accordingly understood as "[t]he act of examining into the affairs of a corporation" by "the government itself." 2 J. Bouvier, A Law Dictionary 790 (15th ed. 1883). Lower courts understood "visitation" to mean "the act of a superior or superintending officer, who visits a corporation to examine into its manner of conducting business, and enforce an observance of its laws and regulations." First Nat. Bank of Youngstown v. Hughes, 6 F. 737, 740 (C.C.N.D.Ohio 1881). A State was the "visitor" of all companies incorporated in the State, simply by virtue of the State's role as sovereign: The "legislature is the visitor of all corporations founded by it." Guthrie v. Harkness, 199 U.S. 148, 157, 26 S.Ct. 4, 50 L.Ed. 130 (1905) (internal quotation marks omitted).

This relationship between sovereign and corporation was understood to allow the States to use prerogative writs—such as mandamus and quo warranto—to exercise control "whenever a corporation [wa]s abusing the power given it, or, . . . or acting adversely to the public, or creating a nuisance." H. Wilgus, Private Corporations, in 8 American Law and Procedure § 157, pp. 224-225 (1910). State visitorial commissions were authorized to "exercise a general supervision" over companies in the State. I. Wormser, Private Corporations § 80, pp. 100, 101, in 4 Modern American Law (1921).

B

Our cases have always understood "visitation" as this right to oversee corporate affairs, quite separate from the power to enforce the law. In the famous Dartmouth College case, Justice Story, describing visitation of a charitable corporation, wrote that Dartmouth was "subject to the controlling authority of its legal visitor, who . . . may amend and repeal its statutes, remove its officers, correct abuses, and generally superintend the management of [its] trusts," and who are "liable to no supervision or control." Trustees of Dartmouth College v. Woodward, 4 Wheat. 518, 676, 681, 4 L.Ed. 629 (1819) (concurring opinion). This power of "genera[l] superintend[ence]" stood in contrast to action by the court of chancery, which acted "not as itself possessing a visitorial power. . . but as possessing a general jurisdiction. . . to redress grievances, and frauds." Id., at 676.^[1]

In Guthrie, supra, we held that a shareholder acting in his role as a private individual was not exercising a "visitorial power" under the National Bank Act when he petitioned a court to force the production of corporate records, id., at 159, 26 S.Ct. 4. [2717] "[C]ontrol in the courts of justice," we said, is not visitorial, and we drew a contrast between the nonvisitorial act of "su[ing] in the courts of the State" and the visitorial "supervision of the Comptroller of the Currency," id., at 159, 157, 26 S.Ct. 4.

In First Nat. Bank in St. Louis v. Missouri, 263 U.S. 640, 44 S.Ct. 213, 68 L.Ed. 486 (1924), we upheld the right of the Attorney General of Missouri to bring suit to enforce a state anti-bank-branching law against a national bank. We said that only the United States may perform visitorial administrative oversight, such as "inquir[ing] by quo warranto whether a national bank is acting in excess of its charter powers." Id., at 660, 44 S.Ct. 213. But if a state statute of general applicability is not substantively pre-empted, then "the power of enforcement must rest with the [State] and not with" the National Government, ibid.^[2]

Our most recent decision, Watters v. Wachovia Bank, N.A., 550 U.S. 1, 127 S.Ct. 1559, 167 L.Ed.2d 389 (2007), does not, as the dissent contends, post, at 2731, "suppor[t] OCC's construction of the statute." To the contrary, it is fully in accord with the well established distinction between supervision and law enforcement. Watters held that a State may not exercise "`general supervision and control'" over a subsidiary of a national bank, 550 U.S., at 8, 127 S.Ct. 1559, because "multiple audits and surveillance under rival oversight regimes" would cause uncertainty, id., at 21, 127 S.Ct. 1559. "[G]eneral supervision and control" and "oversight" are worlds apart from law enforcement. All parties to the case agreed that Michigan's general oversight regime could not be imposed on national banks; the sole question was whether operating subsidiaries of national banks enjoyed the same immunity from state visitation. The opinion addresses and answers no other question.

The foregoing cases all involve enforcement of state law. But if the Comptroller's exclusive exercise of visitorial powers precluded law enforcement by the States, it would also preclude law enforcement by federal agencies. Of course it does not. See, e.g., Bank of America Nat. Trust & Sav. Assn. v. Douglas, 105 F.2d 100, 105-106 (CADC 1939) (Securities Exchange Commission investigation of bank fraud is not an exercise of "visitorial powers"); Peoples Bank of Danville v. Williams, 449 F.Supp. 254, 260 (W.D.Va.1978) (same).

In sum, the unmistakable and utterly consistent teaching of our jurisprudence, both before and after enactment of the National Bank Act, is that a sovereign's "visitorial powers" and its power to enforce the law are two different things. There is not a credible argument to the contrary. And contrary to what the Comptroller's regulation says, the National Bank Act pre-empts only the former.

C

The consequences of the regulation also cast doubt upon its validity. No one denies [2718] that the National Bank Act leaves in place some state substantive laws affecting banks. See Brief for Federal Respondent 20; Brief for Respondent Clearing House Association, L.L.C. 29; post, at 2730-2731. But the Comptroller's rule says that the State may not enforce its valid, non-pre-empted laws against national banks. Ibid. The bark remains, but the bite does not.

The dissent admits, with considerable understatement, that such a result is "unusual," ibid. "Bizarre" would be more apt. As the Court said in St. Louis:

"To demonstrate the binding quality of a statute but deny the power of enforcement involves a fallacy made apparent by the mere statement of the proposition, for such power is essentially inherent in the very conception of law." 263 U.S., at 660, 44 S.Ct. 213.

In sharp contrast to the "unusual" reading propounded by the Comptroller's regulation, reading "visitorial powers" as limiting only sovereign oversight and supervision would produce an entirely commonplace result—the precise result contemplated by our opinion in St. Louis, which said that if a state statute is valid as to national banks, "the corollary that it is obligatory and enforceable necessarily results." Id., at 659-660, 44 S.Ct. 213 (emphasis added). Channeling state attorneys general into judicial law-enforcement proceedings (rather than allowing them to exercise "visitorial" oversight) would preserve a regime of exclusive administrative oversight by the Comptroller while honoring in fact rather than merely in theory Congress's decision not to pre-empt substantive state law. This system echoes many other mixed state/federal regimes in which the Federal Government exercises general oversight while leaving state substantive law in place. See, e.g., Wyeth v. Levine, 555 U.S. ___, 129 S.Ct. 1187, 173 L.Ed.2d 51 (2009).

This reading is also suggested by § 484(a)'s otherwise inexplicable reservation of state powers "vested in the courts of justice." As described earlier, visitation was normally conducted through use of the prerogative writs of mandamus and quo warranto. The exception could not possibly exempt that manner of exercising visitation, or else the exception would swallow the rule. Its only conceivable purpose is to preserve normal civil and criminal lawsuits. To be sure, the reservation of powers "vested in the courts of justice" is phrased as an exception from the prohibition of visitorial powers. But as we have just discussed, it cannot possibly be that, and it is explicable only as an attempt to make clear that the courts' ordinary powers of enforcing the law are not affected.^[3]

On a pragmatic level, the difference between visitation and law enforcement is clear. If a State chooses to pursue enforcement of its laws in court, then it is not exercising its power of visitation and will be treated like a litigant. An attorney general acting as a civil litigant must file a lawsuit, survive a motion to dismiss, endure [2719] the rules of procedure and discovery, and risk sanctions if his claim is frivolous or his discovery tactics abusive. Judges are trusted to prevent "fishing expeditions" or an undirected rummaging through bank books and records for evidence of some unknown wrongdoing. In New York, civil discovery is far more limited than the full range of "visitorial powers" that may be exercised by a sovereign. Courts may enter protective orders to prevent "unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice," N.Y. Civ. Prac. Law Ann. § 3103(a) (West 2005), and may supervise discovery sua sponte, § 3104(a). A visitor, by contrast, may inspect books and records at any time for any or no reason.

II

The Comptroller's regulation, therefore, does not comport with the statute. Neither does the Comptroller's interpretation of its regulation, which differs from the text and must be discussed separately.

Evidently realizing that exclusion of state enforcement of all state laws against national banks is too extreme to be contemplated, the Comptroller sought to limit the sweep of its regulation by the following passage set forth in the agency's statement of basis and purpose in the Federal Register:

"What the case law does recognize is that `states retain some power to regulate national banks in areas such as contracts, debt collection, acquisition and transfer of property, and taxation, zoning, criminal, and tort law.' [citing a Ninth Circuit case.] Application of these laws to national banks and their implementation by state authorities typically does not affect the content or extent of the Federally-authorized business of banking . . . but rather establishes the legal infrastructure that surrounds and supports the ability of national banks . . . to do business." 69 Fed.Reg. 1896 (2004) (footnote omitted).

This cannot be reconciled with the regulation's almost categorical prohibition in 12 CFR § 7.4000(a)(1) of "prosecuting enforcement actions."^[4] Nor can it be justified by the provision in subsection (a)(2)(iv) which defines visitorial powers to include "[e]nforcing compliance with any applicable. . . state laws concerning" "activities authorized or permitted pursuant to federal banking law," § 7.4000(a)(2)(iii). The latter phrase cannot be interpreted to include only distinctively banking activities (leaving the States free to enforce nonbanking state laws), because if it were so interpreted subsection (a)(2)(iii), which uses the same terminology, would limit the Comptroller's exclusive visitorial power of "regulation and supervision" to distinctively banking activities—which no one thinks is the case. Anyway, the National Bank Act does specifically authorize and permit activities that fall within what the statement of basis and purpose calls "the legal [2720] infrastructure that surrounds and supports the ability of national banks . . . to do business." See, e.g., 12 U.S.C. § 24 Third (power to make contracts); § 24 Seventh ("all such incidental powers as shall be necessary to carry on the business of banking"). And of course a distinction between "implementation" of "infrastructure" and judicial enforcement of other laws can be found nowhere within the text of the statute. This passage in the statement of basis and purpose, resting upon neither the text of the regulation nor the text of the statute, attempts to do what Congress declined to do: exempt national banks from all state banking laws, or at least state enforcement of those laws.

III

The dissent fails to persuade us. Its fundamental contention—that the exclusive grant of visitorial powers can be interpreted to preclude state enforcement of state laws—rests upon a logical fallacy. The dissent establishes, post, at 2726, (and we do not at all contest), that in the course of exercising visitation powers the sovereign can compel compliance with the law. But it concludes from that, post, at 2727, that any sovereign attempt to compel compliance with the law can be deemed an exercise of the visitation power. That conclusion obviously does not follow. For example, in the course of exercising its visitation powers, the sovereign can assuredly compel a bank to honor obligations that are in default. Does that mean that the sovereign's taking the same action in executing a civil judgment for payment of those obligations can be considered an exercise of the visitation power? Of course not. Many things can be compelled through the visitation power that can be compelled through the exercise of other sovereign power as well. The critical question is not what is being compelled, but what sovereign power has been invoked to compel it. And the power to enforce the law exists separate and apart from the power of visitation.

The dissent argues that the Comptroller's expansive reading of "visitorial powers" does not intrude upon the, "`the historic police powers of the States,'" post, at 2732, (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 91 L.Ed. 1447 (1947)), because, like federal maritime law, federal involvement in this field dates to "`the earliest days of the Republic,'" post, at 2733 (quoting United States v. Locke, 529 U.S. 89, 108, 120 S.Ct. 1135, 146 L.Ed.2d 69 (2000)). For that reason, the dissent concludes, this case does not raise the sort of federalism concerns that prompt a presumption against pre-emption. We have not invoked the presumption against pre-emption, and think it unnecessary to do so in giving force to the plain terms of the National Bank Act. Neither, however, should the incursion that the Comptroller's regulation makes upon traditional state powers be minimized. Although the sovereign visitorial power of assuring national-bank compliance with all laws inhered in the Federal Government from the time of its creation of national banks, the Comptroller was not given authority to enforce nonpre-empted state laws until 1966. See Financial Institutions Supervisory Act of 1966, Tit. III, 80 Stat. 1046-1055. A power first exercised during the lifetime of every current Justice is hardly involvement "from the earliest days of the Republic."

States, on the other hand, have always enforced their general laws against national banks—and have enforced their banking-related laws against national banks for at least 85 years, as evidenced by St. Louis, in which we upheld enforcement of a state anti-bank-branching law, 263 U.S., at 656, 44 S.Ct. 213. See also Anderson [2721] Nat. Bank v. Luckett, 321 U.S. 233, 237, 248-249, 64 S.Ct. 599, 88 L.Ed. 692 (1944) (state commissioner of revenue may enforce abandoned-bank-deposit law against national bank through "judicial proceedings"); State by Lord v. First Nat. Bank of St. Paul, 313 N.W.2d 390, 393 (Minn. 1981) (state treasurer may enforce general unclaimed-property law with "specific provisions directed toward" banks against national bank); Clovis Nat. Bank v. Callaway, 69 N.M. 119, 130-132, 364 P.2d 748, 756 (1961) (state treasurer may enforce unclaimed-property law against national bank deposits); State v. First Nat. Bank of Portland, 61 Or. 551, 554-557, 123 P. 712, 714 (1912) (state attorney general may enforce bank-specific escheat law against national bank).^[5]

The dissent seeks to minimize the regulation's incursion upon state powers by claiming that the regulation does not "declare the pre-emptive scope of the [National Bank Act]" but merely "interpret[s] the term `visitorial powers.'" Post, at 2732. That is much too kind. It is not without reason that the regulation is contained within a subpart of the Comptroller's regulations on Bank Activities and Operations that is entitled "Preemption." The purpose and function of the statutory term "visitorial powers" is to define and thereby limit the category of action reserved to the Federal Government and forbidden to the States. Any interpretation of "visitorial powers" necessarily "declares the preemptive scope of the NBA," ibid. What is clear from logic is also clear in application: The regulation declares that "[s]tate officials may not . . . prosecut[e] enforcement actions." 12 CFR § 7.4000(a). If that is not pre-emption, nothing is.

IV

Applying the foregoing principles to this case is not difficult. "Visitorial powers" in the National Bank Act refers to a sovereign's supervisory powers over corporations. They include any form of administrative oversight that allows a sovereign to inspect books and records on demand, even if the process is mediated by a court through prerogative writs or similar means. The Comptroller reasonably interpreted this statutory term to include "conducting examinations [and] inspecting or requiring the production of books or records of national banks," § 7.4000, when the State conducts those activities in its capacity as supervisor of corporations.

When, however, a state attorney general brings suit to enforce state law against a national bank, he is not acting in the role of sovereign-as-supervisor, but rather in the role of sovereign-as-law-enforcer. Such a lawsuit is not an exercise of "visitorial powers" and thus the Comptroller erred by extending the definition of "visitorial powers" to include "prosecuting enforcement actions" in state courts, § 7.4000.

The request for information in the present case was stated to be "in lieu of" other action; implicit was the threat that if the request was not voluntarily honored, that other action would be taken. All parties have assumed, and we agree, that if the threatened action would have been unlawful the request-cum-threat could be enjoined. Here the threatened action was not the bringing of a civil suit, or the obtaining of a judicial search warrant based on probable cause, but rather the Attorney General's issuance of subpoena on his own authority under New York [2722] Executive Law, which permits such subpoenas in connection with his investigation of "repeated fraudulent or illegal acts . . . in the carrying on, conducting or transaction of business." See N.Y. Exec. Law Ann. § 63(12) (West 2002). That is not the exercise of the power of law enforcement "vested in the courts of justice" which 12 U.S.C. § 484(a) exempts from the ban on exercise of supervisory power.

Accordingly, the injunction below is affirmed as applied to the threatened issuance of executive subpoenas by the Attorney General for the State of New York, but vacated insofar as it prohibits the Attorney General from bringing judicial enforcement actions.

* * *

The judgment of the Court of Appeals is affirmed in part and reversed in part.

It is so ordered.

Justice THOMAS, with whom THE CHIEF JUSTICE, Justice KENNEDY, and Justice ALITO join, concurring in part and dissenting in part.

The Court holds that the term "visitorial powers" as used in the National Bank Act (NBA), 12 U.S.C. § 484(a), refers only "to a sovereign's supervisory powers over corporations," which are limited to "administrative oversight" including "inspect[ion of] books and records on demand." Ante, at 2721. Based on this definition, the Court concludes that § 484(a) does not pre-empt a "state attorney general['s] . . . suit to enforce state law against a national bank." Ibid. I would affirm the Court of Appeals' determinations that the term "visitorial powers" is ambiguous and that it was reasonable for the Office of the Comptroller of the Currency (OCC) to interpret the term to encompass state efforts to obtain national bank records and to enforce state fair lending laws against national banks. Accordingly, I respectfully concur in part and dissent in part.

I

A

The NBA provides that "[n]o national bank shall be subject to any visitorial powers except as authorized by Federal law, vested in the courts of justice or such as shall be, or have been exercised or directed by Congress or by either House thereof or by any committee of Congress or of either House duly authorized." 12 U.S.C. § 484(a). Through notice-and-comment rulemaking, OCC issued a regulation defining "visitorial powers" as including: "(i) Examination of a bank; (ii) Inspection of a bank's books and records; (iii) Regulation and supervision of activities authorized or permitted pursuant to federal banking law; and (iv) Enforcing compliance with any applicable federal or state laws concerning those activities." 12 CFR § 7.4000(a)(2) (2005). OCC further concluded that 12 U.S.C. § 484(a)'s "vested in the courts of justice" exception pertains only to the "powers inherent in the judiciary and does not grant state or other governmental authorities any right to inspect, superintend, direct, regulate or compel compliance by a national bank with respect to any law, regarding the content or conduct of activities authorized for national banks under Federal law." 12 CFR § 7.4000(b)(2). The Court of Appeals upheld OCC's regulation as reasonable. See 510 F.3d 105 (C.A.2 2007).

This Court's decision in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), provides the framework for deciding this case. "In Chevron, this Court held that ambiguities in statutes within an agency's jurisdiction to administer are delegations of authority to the [2723] agency to fill the statutory gap in reasonable fashion." National Cable & Telecommunications Assn. v. Brand X Internet Services, 545 U.S. 967, 980, 125 S.Ct. 2688, 162 L.Ed.2d 820 (2005). Accordingly, "[i]f a statute is ambiguous, and if the implementing agency's construction is reasonable, Chevron requires a federal court to accept the agency's construction of the statute, even if the agency's reading differs from what the court believes is the best statutory interpretation." Ibid.

OCC is "the administrator charged with supervision of the [NBA]," NationsBank of N.C., N.A. v. Variable Annuity Life Ins. Co., 513 U.S. 251, 256, 115 S.Ct. 810, 130 L.Ed.2d 740 (1995), and it acted through notice-and-comment rulemaking procedures in promulgating the regulation at issue in this case, see 69 Fed.Reg. 1895 (2004). As a result, 12 CFR § 7.4000 falls within the heartland of Chevron. See United States v. Mead Corp., 533 U.S. 218, 229-230, 121 S.Ct. 2164, 150 L.Ed.2d 292 (2001); see also, e.g., Smiley v. Citibank (South Dakota), N.A., 517 U.S. 735, 739, 116 S.Ct. 1730, 135 L.Ed.2d 25 (1996) (deferring to OCC's interpretation of the term "`interest'" in the NBA). "It is our practice to defer to the reasonable judgments of agencies with regard to the meaning of ambiguous terms in statutes that they are charged with administering," and "that practice extends to the judgments of the Comptroller of the Currency with regard to the meaning of the banking laws." Ibid. The majority does not disagree. See ante, at 2715-2716. As a result, the only disputed question is whether the statutory term "visitorial powers" is ambiguous and, if so, whether OCC's construction of it is reasonable.

B

The majority concedes that there is "some ambiguity as to the meaning of the statutory term `visitorial powers.'" Ibid. Yet it concludes that OCC's interpretation of § 484(a) is not entitled to deference because the Court "can discern the outer limits of the term `visitorial powers' even through the clouded lens of history" and these outer definitional limits "do not include. . . ordinary enforcement of the law." Ibid. I cannot agree. The statutory term "visitorial powers" is susceptible to more than one meaning, and the agency's construction is reasonable.

Because the NBA does not define "visitorial powers," the ordinary meaning of the words chosen by Congress provides the starting point for interpreting the statute. See Dean v. United States, 556 U.S. ___, ___, 129 S.Ct. 1849, 1853, 173 L.Ed.2d 785 (2009) ("We start, as always, with the language of the statute" (internal quotation marks omitted)); Asgrow Seed Co. v. Winterboer, 513 U.S. 179, 187, 115 S.Ct. 788, 130 L.Ed.2d 682 (1995) ("When terms used in a statute are undefined, we give them their ordinary meaning"). In 1864, when the NBA was enacted, "visitation" was generally defined as "[i]nspection; superintendence; direction; [and] regulation." 2 A. Burrill, A Law Dictionary and Glossary 598 (1860); see also 2 J. Bouvier, A Law Dictionary 633 (1852) (defining "visitation" as "[t]he act of examining into the affairs of a corporation"). With respect to civil corporations, "visitation" was conducted "by the government itself, through the medium of the courts of justice." Id., at 634. The Court has previously looked to these definitions in examining the meaning of "visitorial powers" for purposes of the NBA. See Guthrie v. Harkness, 199 U.S. 148, 158, 26 S.Ct. 4, 50 L.Ed. 130 (1905).

OCC's interpretation of "visitorial powers" to include both "[r]egulation and supervision of activities authorized or permitted pursuant to federal banking law" and [2724] "[e]nforcing compliance with any applicable federal or state laws concerning those activities," 12 CFR §§ 7.4000(a)(2)(iii), (vi), fits comfortably within this broad dictionary definition of "visitation." And, in turn, petitioner's demand for nonpublic information to force national banks to comply with state fair lending laws under threat of judicial action would appear to qualify as an attempt to "superinten[d]" the banks' federally authorized operations "through the medium of the courts of justice." See Burrill, supra, at 598; Bouvier, supra, at 634.

On the other hand, as the majority concludes, "visitorial powers" could be limited to conducting examinations of national banks or otherwise interfering with their internal operations. To support this argument, the majority briefly alludes to the common-law history of visitation. See ante, at 2715-2716; see also United States v. Shabani, 513 U.S. 10, 13, 115 S.Ct. 382, 130 L.Ed.2d 225 (1994) ("[A]bsent contrary indications, Congress intends to adopt the common law definition of statutory terms"). In so doing, the majority fully accepts petitioner's argument that "Congress invoked a then-familiar common law term of corporate governance—visitation—to clarify that the States, traditionally the supervisors of private corporations doing business within their jurisdictions, had no authority to examine the condition of a national bank, respond to any perceived financial risk, or hold the bank to its charter or the laws of its creation." Brief for Petitioner 21-22. Under the majority's view, any construction of § 484(a) that fails to preserve the right of the States to enforce through judicial action their generally applicable laws against national banks is unreasonable and, therefore, not entitled to deference. See ante, at 2717.

But contrary to the majority's determination, the common-law tradition does not compel the conclusion that petitioner's definition of visitation is the only permissible interpretation of the term. Indeed, a more thorough examination of § 484(a)'s common-law ancestry suggests the opposite. As the majority notes, see ante, at 2715-2716, the concept of visitation originated in Roman and canon law in which the term was used to describe the church hierarchy's authority over its own institutions, see Pound, Visitatorial Jurisdiction Over Corporations in Equity, 49 Harv. L.Rev. 369, 369-370 (1936). The practice of visitation later expanded to include the supervision of charities, universities, and civil corporations. Ibid.

With respect to churches, charities, and universities, a visitor's duties were narrow. In the university setting, for example, the "power of the visitor [was] confined to offences against the private laws of the college; he ha[d] no cognizance of acts of disobedience to the general laws of the land." 2 S. Kyd, Law of Corporations 276 (1794) (emphasis in original). The visitor's duties were equally narrow in the governance of ecclesiastical and charitable institutions. See 1 W. Blackstone, Commentaries on the Laws of England 467-472 (1765); Trustees of Dartmouth College v. Woodward, 4 Wheat. 518, 673-677, 4 L.Ed. 629 (1819) (Story, J., concurring). If the sweep of a visitor's authority with respect to civil corporations was the same, the majority would have a stronger argument that the "visitorial powers" prohibition was similarly limited. See ante, at 2717. However, the common-law tradition instead suggests that visitorial powers were broader with respect to civil corporations, including banks.

Historically, visitorial authority over civil corporations was exercised only by the sovereign who had broad authority to assure [2725] compliance with generally applicable laws. See Blackstone, supra, at 469 ("The king being thus constituted by law the visitor of all civil corporations, the law has also appointed the place, wherein he shall exercise this jurisdiction: which is the court of king's bench; where, and where only, all misbehaviors of this kind of corporations are enquired into and redressed, and all their controversies decided"); 2 J. Kent, Commentaries on American Law 241 (1827) (explaining that "visitation of civil corporations is by the government itself, through the medium of the courts of justice"). "Civil corporations, whether public, as the corporations of towns and cities; or private, as bank, insurance, manufacturing, and other companies of the like nature, are not subject to [private] visitation. They are subject to the general law of the land, and amenable to the judicial tribunals for the exercise and the abuse of their powers." Id., at 244; see also J. Angell & S. Ames, Law of Private Corporations § 684, p. 680 (4th ed. 1852) ("Civil corporations, whether public or private, being created for public use and advantage, properly fall under the superintendency of that sovereign power whose duty it is to take care of the public interest; whereas, corporations, whose object is the distribution of a private benefaction, may well find jealous guardians in the zeal or vanity of the founder, his heirs, or appointees").

States have traditionally exercised their visitorial powers over civil corporations by invoking the authority of the judiciary to "compel domestic corporations or their officers to perform specific duties incumbent on them by reason of their charters, or under statutes or ordinances or imposed by the common law." Pound, supra, at 375 (emphasis added); see also S. Merrill, Law of Mandamus § 158, p. 194 (1892) (explaining that "under the visitorial power of the state, any breach of duty by a private corporation may be corrected by" the writ of mandamus and that the duty "may be imposed by [the corporation's] charter, by the general statutes, or by the common law" (footnotes omitted)). As Merrill explained, such actions were employed to compel common carriers and certain other civil corporations to adhere to "statutory or common law" duties, including the duty to "exten[d] to all without discrimination the use of their services." Id., § 162, at 200; see also J. Grant, A Practical Treatise on the Law of Corporations in General, As Well Aggregate as Sole 262 (1854) (explaining that mandamus was available when corporations "refuse[d] to perform a duty cast upon them by the law of the land").^[6]

[2726] Even before enactment of the NBA, several States enacted laws granting banking commissioners specific authority to investigate compliance with generally applicable laws and to use the courts to ensure observance therewith. See, e.g., Act of Feb. 23, ch. 14, § 2, 1838 Mass. Acts p. 303 (authorizing banking commissioners to "visit" a bank and "examine all [its] affairs" to determine whether it had "complied with the provisions of law applicable to [its] transactions"); Act of May 14, ch. 363, § 12, 1840 N.Y. Laws pp. 307-308 (authorizing banking commissioners to bring judicial actions against banks "found to have violated any law of this state . . . in the same manner and with the like effect as any incorporated bank may be proceeded against for a violation of its charter"). Indeed, Congress modeled the NBA after New York's supervisory regime. See J. Knox, A History of Banking in the United States 422 (1903) (reprint 1969).

Petitioner contends, and the majority agrees, that this understanding of the common law confuses the sovereign's "enforcement of general laws that apply equally to all actors within a State, like the ban on discrimination found in New York Executive Law § 296-a" with "an exercise of visitorial powers." Brief for Petitioner 24; see also ante, at 2717 (concluding that "a sovereign's `visitorial powers' and its power to enforce the law are two different things"). But this narrow conception of visitorial powers does not fully capture the common law. In a section entitled "Visitorial power," one treatise explained that "[a]s a general rule the state has the same control, in this respect, over corporations that it has over individuals." C. Elliott, Law of Private Corporations § 90, p. 80 (rev.3d ed.1900); see also 1 S. Thompson, Commentaries on the Law of Private Corporations § 475, p. 580 (2d ed.1908) ("In its visitorial capacity the state checks and controls corporate affairs, even for the protection of those who deal with them"). If the sovereign's power of visitation was limited to oversight of "corporate affairs," visitation would not parallel the sovereign's control over individuals or allow the sovereign to protect through judicial action the rights of individuals who "deal with" the corporation. See ibid.

The Wisconsin Supreme Court's decision in Attorney General v. Chicago & Northwestern R. Co., 35 Wis. 425 (1874) — which has been referred to as "the leading American case for the visitorial jurisdiction of equity," Pound, 49 Harv. L.Rev., at 380— illustrates the point. In that case, the state attorney general sought a writ of injunction to "restrain the two defendant companies from exacting tolls for the carriage of passengers or freight in excess of the maximum rates established by" Wisconsin law, 35 Wis., at 432. The attorney general "appl[ied] for the writ on behalf of the public," id., at 531, in order "`to correct abuses and save the rights of the people,'" id., at 572. The court found that the attorney general's visitorial power included enforcement of generally applicable law against civil corporations through courts of equity. See id., at 529-530. As the court explained, the common-law understanding of visitorial powers had expanded beyond its ecclesiastical roots to include such authority. See id., at 530 ("The grounds on which this jurisdiction rests are ancient; but the extent of its application has grown rapidly of late years, until a comparatively obscure and insignificant jurisdiction has become one of great magnitude and public import").

As a result, the majority's conclusion that when "a state attorney general brings suit to enforce state law against a national [2727] bank, he is not acting in the role of sovereign-as-supervisor, but rather in the role of sovereign-as-law-enforcer," ante, at 2721, cannot be reconciled with this leading case or the general common-law understanding on which the decision rests. At common law, all attempts by the sovereign to compel civil corporations to comply with state law—whether through administrative subpoenas or judicial actions—were visitorial in nature. Thus, even if the sovereign's law enforcement and visitorial powers were at one time distinct, by common law, they had merged at least with respect to the enforcement of generally applicable public laws against civil corporations. See Thompson, supra, § 460, at 556 ("The police power, in its visitorial aspect, as exercised by congress and the several states, extends to the minutest details of the banking business" (emphasis added)). By construing visitation so narrowly, the majority implicitly rejects the efforts of William Blackstone, James Kent, and Roscoe Pound, see supra, at 2717, in elucidating the historical meaning of this concept. Like OCC, each of these venerable legal scholars understood visitation of civil corporations to include the power to enforce generally applicable laws through judicial actions. See ibid.

In the end, OCC was presented with a broad dictionary definition of "visitation" and a common-law history suggesting that the scope of the visitor's authority varied in accordance with the nature of the organization under supervision. It is possible that the "visitorial powers" are narrower than OCC concluded. But a visitor's powers could also be broader. There is support for the proposition that visitation includes enforcement of all generally applicable laws. See supra, at 2716-2719. OCC instead interpreted "visitorial powers" to prohibit only enforcement of laws concerning "activities authorized or permitted pursuant to federal banking law." 12 CFR §§ 7.4000(a)(2)(iii) and (iv). States are thus free to enforce applicable laws that do not regulate federally authorized banking activities, see § 7.4000(a)(3), "including, for example, criminal, tax, zoning, and labor and employment laws," Brief for Federal Respondent 15 (citing 69 Fed. Reg. 1896).

Thus, although the text and history of visitation do not authoritatively support either party's construction of the statute, OCC's decision to adopt a more modest construction than could have been supported by the common-law and dictionary definition reinforces the reasonableness of its regulation. Put simply, OCC selected a permissible construction of a statutory term that was susceptible to multiple interpretations.

C

Petitioner nonetheless argues that the original structure of the NBA compels us to adopt his reading of "visitorial powers." When enacted in 1864, the "visitorial powers" clause was preceded by a statutory provision directing the Comptroller of the Currency to appoint persons "to make a thorough examination into all the affairs of [every banking] association" and to "make a full and detailed report of the condition of the association to the comptroller." Act of June 3, 1864, ch. 106, § 54, 13 Stat. 116. In addition, the "visitorial powers" clause was succeeded by a sentence concerning the compensation due to the examiners. See ibid. Petitioner contends that the placement of the "visitorial powers" clause between these two provisions indicates that it originally meant to ban States only from conducting the particular type of "thorough examination" of banking affairs described in the neighboring provisions. And, petitioner adds, § 484 currently resides in the subchapter [2728] of the statute entitled "Bank Examinations," which still includes a provision directing the Comptroller to appoint examiners "to make a thorough examination of all the affairs of the bank and . . . make a full and detailed report of the condition of said bank to the Comptroller of the Currency." 12 U.S.C. § 481.

Petitioner's argument is undermined, however, by other structural attributes of this subchapter. In § 484(b), for example, Congress provided that "[n]otwithstanding" the statute's visitorial-powers prohibition, "State auditors and examiners may. . . review [a national bank's] records solely to ensure compliance with applicable State unclaimed property or escheat laws." Such review does not fall within petitioner's definition of "visitorial powers" because the enforcement of state property laws is in no way associated with national bank examinations or internal operations. Thus, were § 484(a) to have the meaning petitioner assigns, there would have been no reason for Congress to identify the § 484(b) authority as an exception to § 484(a)'s "visitorial powers" prohibition, as the authority granted in § 484(b) would never have been eliminated by § 484(a).

Other exceptions in § 484 also support OCC's construction of the statute. For example, § 484(a) includes an exception for visitations "authorized by Federal law." One type of visitation authorized by law is described in 26 U.S.C. § 3305(c), which provides that "[n]othing contained in [§ 484] shall prevent any State from requiring any national" bank to provide payroll records and reports for unemployment tax purposes. Similarly, 12 U.S.C. § 62 permits state tax officials to inspect national bank shareholder lists. Both provisions would be unnecessary if "visitorial powers" were limited to bank examinations and internal operations

In sum, the NBA's structure does not compel the construction of § 484(a)'s text that petitioner advocates. If anything, given the manner in which Congress crafted exceptions to the "visitorial powers" ban in the statute, the opposite is true.^[7]

D

The majority also accepts petitioner's contention that OCC's construction of "visitorial powers" is unreasonable because it conflicts with several of this Court's decisions. See ante, at 2716-2717. But petitioner cannot prevail by simply showing that this Court previously adopted a construction of § 484 that differs from the interpretation later chosen by the agency. [2729] "A court's prior judicial construction of a statute trumps an agency construction otherwise entitled to Chevron deference only if the prior court decision holds that its construction follows from the unambiguous terms of the statute and thus leaves no room for agency discretion." Brand X, 545 U.S., at 982, 125 S.Ct. 2688. These decisions do not construe § 484 in a manner that trumps OCC's regulation.

This Court's only decision directly addressing the meaning of "visitorial powers" is Guthrie, which held that the NBA did not prohibit a suit brought by a private shareholder seeking to inspect the books of a national bank, 199 U.S., at 157, 26 S.Ct. 4. In so holding, the Court contrasted "the private right of the shareholder to have an examination of the business in which he is interested" with a visitor's "public right" to examine "the conduct of the corporation with a view to keeping it within its legal powers." Id., at 158-159, 26 S.Ct. 4. Guthrie thus draws a line between enforcement of private rights and the public act of visitation that is consistent with the definition of visitation embraced by OCC. See id., at 158, 26 S.Ct. 4 ("In no case or authority that we have been able to find has there been a definition of this right, which would include the private right of the shareholder to have an examination of the business in which he is interested . . ."). The agency has never taken the position that the "visitorial powers" prohibition extends to private action.

Nor does this Court's decision in First Nat. Bank in St. Louis v. Missouri, 263 U.S. 640, 44 S.Ct. 213, 68 L.Ed. 486 (1924) (St.Louis), foreclose OCC's construction of the statute. In that case, the State of Missouri brought a quo warranto proceeding in state court "to determine [the national bank's] authority to establish and conduct a branch bank in the City of St. Louis." Id., at 655, 44 S.Ct. 213. The Court first held that federal law did not authorize national banks to engage in branch banking. See id., at 656-659, 44 S.Ct. 213. "Having determined that the power sought to be exercised by the bank finds no justification in any law or authority of the United States," the Court then concluded that "the way is open for the enforcement of the state statute." Id., at 660, 44 S.Ct. 213.

Petitioner contends, and the majority agrees, see ante, at 2716-2717, and n. 2, that St. Louis stands for the proposition that a State retains the right to enforce any state law that is not substantively preempted with respect to national banks, see 263 U.S., at 660, 44 S.Ct. 213 ("To demonstrate the binding quality of a statute but deny the power of enforcement involves a fallacy made apparent by the mere statement of the proposition, for such power is essentially inherent in the very conception of law. . . . What the state is seeking to do is to vindicate and enforce its own law. . ."). Under this view, then, because the New York fair lending laws are not substantively pre-empted, he is not exercising "visitorial powers" by enforcing them.

Respondents counter that the holding of St. Louis is not so broad. In their view, the Court held only that a State may enforce its laws against a national bank when federal law grants the bank no authority to engage in the underlying activity at issue. See Brief for Respondent Clearing House Association 33-34. Here, federal law expressly authorizes national banks to make mortgage loans. See 12 U.S.C. § 371(a). Thus, unlike in St. Louis—in which the relevant state-law-proscribed conduct in a category that was wholly beyond the powers granted to national banks—petitioner seeks to superintend the manner in which the national banks engage in activity expressly authorized by federal law. According to respondents, then, § 484(a)'s [2730] ban on unauthorized visitation provides the "controlling reason" forbidding state enforcement that was absent from St. Louis, see 263 U.S., at 660, 44 S.Ct. 213.

There is no need to decide which party has the better argument. The St. Louis decision nowhere references § 484(a) or addresses "visitorial powers." Thus, as noted above, even if the decision is best read to support petitioner's view of the statute, that conclusion is insufficient to deny Chevron deference to OCC's construction of § 484(a). "Since Chevron teaches that a court's opinion as to the best reading of an ambiguous statute an agency is charged with administering is not authoritative, the agency's decision to construe that statute differently from a court does not say that the court's holding was legally wrong. Instead, the agency may, consistent with the court's holding, choose a different construction, since the agency remains the authoritative interpreter (within the limits of reason) of such statutes." Brand X, 545 U.S., at 983, 125 S.Ct. 2688. A judicial decision that fails to directly confront the provision at issue cannot be deemed to have adopted the "authoritative" construction of the statute.^[8] Petitioner's reliance on other decisions of this Court is misplaced for this very same reason. See First Nat. Bank in Plant City v. Dickinson, 396 U.S. 122, 90 S.Ct. 337, 24 L.Ed.2d 312 (1969); Anderson Nat. Bank v. Luckett, 321 U.S. 233, 64 S.Ct. 599, 88 L.Ed. 692 (1944); First Nat. Bank of Bay City v. Fellows, 244 U.S. 416, 37 S.Ct. 734, 61 L.Ed. 1233 (1917); Easton v. Iowa, 188 U.S. 220, 23 S.Ct. 288, 47 L.Ed. 452 (1903); Waite v. Dowley, 94 U.S. 527, 24 L.Ed. 181 (1877); National Bank v. Commonwealth, 9 Wall. 353, 19 L.Ed. 701 (1870). None of these decisions addressed the meaning of "visitorial powers" for purposes of § 484(a), let alone provided a definitive construction of the statute.

Finally, this Court's decision in Watters v. Wachovia Bank, N.A., 550 U.S. 1, 127 S.Ct. 1559, 167 L.Ed.2d 389 (2007), supports OCC's construction of the statute. Watters addressed whether the NBA preempted the application of certain Michigan laws to the mortgage-lending activities of an operating subsidiary of a national bank. See id., at 7-8, 127 S.Ct. 1559. In deciding that issue, the Court did not reach the question presented here. But the Court was fully aware that the Michigan statutes granted state banking commissioners the very enforcement authority that petitioner seeks to exert over the national banks in this case. See id., at 9-10, 127 S.Ct. 1559 (citing Mich. Comp. Laws Ann. §§ 445.1661 (West 2002), 493.56b (West Supp.2005)); see also 550 U.S., at 34, 127 S.Ct. 1559 (STEVENS, J., dissenting) (describing [2731] §§ 445.1661 and 493.56b as "state visitorial oversight").^[9]

As the Court explained, although "the Michigan provisions at issue exempt[ed] national banks from coverage . . . [t]his [was] not simply a matter of the Michigan Legislature's grace. For, as the parties recognize, the NBA would have preemptive force, i.e., it would spare a national bank from state controls of the kind here involved." 550 U.S., at 13, 127 S.Ct. 1559 (citations omitted); see ibid. (explaining that "real estate lending, when conducted by a national bank, is immune from state visitorial control"). The Court's conclusion in Watters that § 484(a) deprives the States of inspection and enforcement authority over the mortgage-lending practices of national banks lends weight to the agency's construction of the statute.

II

Petitioner also argues that three different background principles trigger a clear-statement rule that overcomes any Chevron deference to which OCC's construction of § 484 otherwise might be entitled. I disagree. None of petitioner's arguments provide a doctrinal basis for refusing to defer to the agency's reasonable construction of this statute.

First, petitioner contends that OCC's regulation, which interprets § 484(a) to pre-empt state enforcement of state law but not the substantive state law itself, undermines important federalism principles and therefore triggers a requirement that Congress clearly state its pre-emptive intentions, see Gregory v. Ashcroft, 501 U.S. 452, 460, 111 S.Ct. 2395, 115 L.Ed.2d 410 (1991) ("[I]f Congress intends to alter the usual constitutional balance between the States and the Federal Government, it must make its intention to do so unmistakably clear in the language of the statute" (internal quotation marks omitted; alteration in original)). Petitioner is incorrect because OCC's construction of the statute does not alter the balance of power established by the Constitution.

National banks are created by federal statute and therefore are subject to full congressional control. The States "can exercise no control over them, nor in any wise affect their operation, except in so far as Congress may see proper to permit." Farmers' and Mechanics' Nat. Bank v. Dearing, 91 U.S. 29, 34, 23 L.Ed. 196 (1875); see also Watters, 550 U.S., at 10, 127 S.Ct. 1559 ("Nearly 200 years ago, in McCulloch v. Maryland, 4 Wheat. 316, 4 L.Ed. 579 (1819), this Court held federal law supreme over state law with respect to national banking"). As a result, the only question presented by this case is whether Congress has seen it "proper to permit" the States to enforce state fair lending laws against national banks. OCC's reasonable conclusion that § 484(a) answers that question in the negative does not alter the federal-state balance; it simply preserves for OCC the oversight responsibilities assigned to it by Congress. See id., at 22, 127 S.Ct. 1559 ("Regulation of national [2732] bank operations is a prerogative of Congress under the Commerce and Necessary and Proper Clauses. The Tenth Amendment, therefore, is not implicated here" (citation omitted)).

Second, petitioner argues that a clear statement is required because "the historic police powers of the States [are] not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress," Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 91 L.Ed. 1447 (1947). There should be no presumption against pre-emption because Congress has expressly pre-empted state law in this case. See Altria Group, Inc. v. Good, 555 U.S. ___, ___, 129 S.Ct. 538, 556, 172 L.Ed.2d 398 (2008) (THOMAS, J., dissenting) ("[T]he presumption against pre-emption `dissolves once there is conclusive evidence of intent to pre-empt in the express words of the statute itself'") (quoting Cipollone v. Liggett Group, Inc., 505 U.S. 504, 545, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992) (SCALIA, J., concurring in judgment in part and dissenting in part)); see, e.g., Riegel v. Medtronic, Inc., 552 U.S. ___, ___, 128 S.Ct. 999, 1003, 169 L.Ed.2d 892 (2008) (construing the express pre-emption provision of the Medical Device Amendments of 1976, 21 U.S.C. § 360c et seq., without any reliance on the presumption against pre-emption).

In any event, this presumption is "not triggered when the State regulates in an area where there has been a history of significant federal presence." United States v. Locke, 529 U.S. 89, 108, 120 S.Ct. 1135, 146 L.Ed.2d 69 (2000). National banking is the paradigmatic example "In defining the pre-emptive scope of statutes and regulations granting a power to national banks," this Court has taken the firm view that "normally Congress would not want States to forbid, or to impair significantly, the exercise of a power that Congress explicitly granted." Barnett Bank of Marion Cty., N.A. v. Nelson, 517 U.S. 25, 33, 116 S.Ct. 1103, 134 L.Ed.2d 237 (1996). As a result, federal legislation concerning national banks is "not normally limited by, but rather ordinarily preempt[s], contrary state law." Id., at 32, 116 S.Ct. 1103. As with general maritime law, Congress' "legislat[ion] in th[is] field from the earliest days of the Republic" and its creation of an "extensive federal statutory and regulatory scheme" means that an "`assumption' of nonpre-emption is not triggered." Locke, supra, at 108, 120 S.Ct. 1135. That the States may also have legislated alongside Congress in this area, see ante, at 2720-2721, does not alter this conclusion, see, e.g., Franklin Nat. Bank of Franklin Square v. New York, 347 U.S. 373, 74 S.Ct. 550, 98 L.Ed. 767 (1954).

Last, petitioner argues that Chevron deference is inapplicable because OCC's regulation declares the pre-emptive scope of the NBA. And, the majority flatly asserts that "[i]f that is not pre-emption, nothing is." Ante, at 2721. But OCC did not declare the pre-emptive scope of the statute; rather, it interpreted the term "visitorial powers" to encompass state enforcement of state fair lending laws. The pre-emption of state enforcement authority to which petitioner objects thus follows from the statute itself—not agency action. See Smiley, 517 U.S., at 744, 116 S.Ct. 1730 ("This argument confuses the question of the substantive (as opposed to pre-emptive) meaning of a statute with the question of whether a statute is pre-emptive. We may assume (without deciding) that the latter question must always be decided de novo by the courts. That is not the question at issue here; there is no doubt that § 85 pre-empts state law" (emphasis in original)).

Here, Congress—not the agency—has decided that "[n]o national bank shall be [2733] subject to any visitorial powers except as authorized by Federal law." 12 U.S.C. § 484(a). Indeed, the majority agrees that it is the "statutory term"—and not OCC's regulation—that "define[s] and thereby limit[s] the category of action reserved to the Federal Government and forbidden to the States." Ante, at 2721. As a result, OCC has simply interpreted that term to encompass petitioner's decision to demand national bank records and threaten judicial enforcement of New York fair lending laws as a means of obtaining them. As Smiley showed, a federal agency's construction of an ambiguous statutory term may clarify the pre-emptive scope of enacted federal law, but that fact alone does not mean that it is the agency, rather than Congress, that has effected the pre-emption.

Petitioner's federalism-based objections to Chevron deference ultimately turn on a single proposition: It is doubtful that Congress pre-empted state enforcement of state laws but not the underlying state laws themselves. But it is not this Court's task to decide whether the statutory scheme established by Congress is unusual or even "[b]izarre." See ante, at 2718. The Court must decide only whether the construction adopted by the agency is unambiguously foreclosed by the statute's text. Here, the text, structure, and history of "visitorial powers" support the agency's reasonable interpretation of § 484. Petitioner has not identified any constitutional principle that would require Congress to take the greater step of pre-empting all enforcement of state lending laws (including private enforcement) even though its central concern was the allocation of the right to exercise public visitation over national bank activities.

* * *

For all these reasons, I would affirm the judgment of the Court of Appeals.

[1] Justice THOMAS's opinion concurring in part and dissenting in part (hereinafter the dissent) attempts to distinguish Dartmouth College on the ground that the college was a charitable corporation, whose visitors (unlike the State as visitor of for-profit corporations) had no law-enforcement power. See post, at 2725-2726, n. 1. We doubt that was so. As Justice Story's opinion in Dartmouth College stated, visitors of charitable corporations had "power . . . to correct all irregularities and abuses," 4 Wheat., at 673, 4 L.Ed. 629, which would surely include operations in violation of law. But whether or not visitors of charitable corporations had law-enforcement powers, the powers that they did possess demonstrate that visitation is different from ordinary law enforcement. Indeed, if those powers did not include the power to assure compliance with law that demonstration would be all the more forceful.

[2] The dissent attempts to distinguish St. Louis by invoking the principle that an agency is free to depart from a court's interpretation of the law. Post, at 2730-2731 (citing National Cable & Telecommunications Assn. v. Brand X Internet Services, 545 U.S. 967, 982, 125 S.Ct. 2688, 162 L.Ed.2d 820 (2005)). This again misses the point. St. Louis is relevant to proper interpretation of 12 U.S.C. § 484(a) not because it is authoritative on the question whether States can enforce their banking laws, but because it is one in a long and unbroken line of cases distinguishing visitation from law enforcement. Respondents contend that St. Louis holds only that States can enforce their law when federal law grants the national bank no authority to engage in the activity at issue. Even if that were true it would make no difference. The case would still stand for the proposition that the exclusive federal power of visitation does not prevent States from enforcing their law.

[3] We reject respondents' contention that the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, § 102(f)(1)(B), 108 Stat. 2349, 2350, 12 U.S.C. § 36(f)(1)(B), establishes that the Comptroller's visitorial power pre-empts state law enforcement. That provision states that some state laws respecting bank branching "shall be enforced" by the Comptroller. We need not decide here whether converting the Comptroller's visitorial power to assure compliance with all applicable laws, see infra, at 2720, into an obligation to assure compliance with certain state laws preempts state enforcement of those particular laws. Even if it had that effect it would shed no light on the meaning of "visitorial powers" in the National Bank Act, a statute that it does not refer to and that was enacted more than a century earlier.

[4] The prohibition is not entirely categorical only because it is subject to the phrase at the end of the sentence (applicable to all of the regulation's enumerated "visitorial powers" forbidden to the States): "except in limited circumstances authorized by federal law." This replicates a similar exception contained in § 484(a) itself ("No national bank shall be subject to any visitorial powers except as authorized by Federal law"), and certainly does not refer to case law finding state action nonpre-empted. If it meant that, § 484(a)'s apparent limitation of visitorial powers would be illusory—saying, in effect, that national banks are subject to only those visitorial powers that the courts say they are subject to. Cases that find state action nonpre-empted might perhaps be described as "permitting" the state action in question, but hardly as "authorizing" it. In both the statutory and regulation context, "federal law" obviously means federal statutes.

[5] All of these cases were decided before Congress added to § 484 its current subsection (b), which authorizes "State auditors and examiners" to review national-bank records to assure compliance with state unclaimed-property and escheat laws. See 96 Stat. 1521.

[6] By looking to Justice Story's concurrence in Trustees of Dartmouth College v. Woodward, 4 Wheat. 518, 4 L.Ed. 629 (1819), for authoritative guidance, see ante, at 2716-2717, the majority seemingly rejects the distinction between the visitor's role in supervising civil corporations and the visitor's far more limited role in supervising private institutions such as churches, universities, and charitable organizations. See ante, at 2716, n. 1. In Woodward, the Court addressed the scope of the visitor's authority over a private college—not a civil corporation. See 4 Wheat., at 562-563, 4 L.Ed. 629 ("The corporation in question is not a civil, although it is a lay corporation. It is an eleemosynary corporation. . . . Eleemosynary corporations are for the management of private property, according to the will of the donors. They are private corporations" (emphasis in original)). Visitors historically did not have "law enforcement power" over churches, universities, and charitable organizations. See supra, at 2716-2717. But there is strong evidence that visitors of civil corporations—i.e., sovereigns—were so empowered. See supra, at 2717-2718. The distinction between these species of visitation is crucial because it yields divergent understandings as to the scope of the visitor's power to enforce generally applicable laws in court. Moreover, the majority's failure to confront this important difference leaves a gap in its historical analysis that, in turn, undermines its conclusion that OCC's interpretation of § 484(a) was unreasonable.

[7] Contrary to the majority's conclusion, see ante, at 2718, n. 3, petitioner's structural argument is also undermined by the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (Riegle-Neal), 108 Stat. 2338, which authorized national banks to operate interstate branches. The statute provides that "[t]he laws of the host State regarding community reinvestment, consumer protection, fair lending, and establishment of intrastate branches shall apply to any branch in the host State of an out-of-State national bank to the same extent as such State laws apply to a branch of a bank chartered by that State" unless federal law separately preempts their application or the Comptroller determines that application of the state law would have a "discriminatory effect" on the national bank branch. See id., at 2349-2350, 12 U.S.C. § 36(f)(1)(A). Riegle-Neal further provides that "[t]he provisions of any State law to which a branch of a national bank is subject under this paragraph shall be enforced, with respect to such branch, by the Comptroller of the Currency." See id., at 2350, 12 U.S.C. § 36(f)(1)(B). The United States has interpreted the "shall be enforced" language to provide OCC with exclusive enforcement authority. See Brief for Federal Respondent 46-48. This construction reinforces OCC's interpretation of § 484(a). If OCC has exclusive authority to enforce state law with respect to interstate branches of national banks, it would be reasonable to interpret the statute to operate similarly with respect to the national banks themselves.

[8] The majority's suggestion that the Court's decision in First Nat. Bank in St. Louis v. Missouri, 263 U.S. 640, 44 S.Ct. 213, 68 L.Ed. 486 (1924), is not "authoritative" falls short of the mark. See ante, at 2717, n. 2; see, e.g., ante, at 2717-2718 ("[R]eading `visitorial powers' as limiting only sovereign oversight and supervision would produce an entirely commonplace result—the precise result contemplated by our opinion in St. Louis"). According to the majority, irrespective of which party has the better reading of that case, it "would still stand for the proposition that the exclusive federal power of visitation does not prevent States from enforcing their law." Ante, at 2717, n. 2. But that conclusion rests on the assumption that the St. Louis Court shared the majority's conception of law enforcement and visitation as categorically distinct for purposes of § 484(a). It is impossible to verify that assumption, however, because the bank never raised the "visitorial powers" defense in that case. See Reply Brief for Petitioner 6. If the Chevron doctrine is to have any interpretative value, an agency's construction of a statute cannot be foreclosed by a prior judicial decision in which the provision in question was neither raised by the parties nor passed upon by the court.

[9] The majority contends that Watters is "fully in accord with the well established distinction between supervision and law enforcement." Ante, at 2717. But this argument ignores the reach of the statutes that the Court assumed were visitorial in Watters. The Michigan laws at issue in Watters allowed for much more than "`general supervision and control'" of the operating subsidiaries of national banks. Ante, at 2717. They also included provisions permitting the state attorney general to "take any appropriate legal action to enjoin the operation of the business" and allowing the commissioner "[t]o bring an action in . . . circuit court in the name and on behalf of this state" to enjoin "any unsafe or injurious practice or act in violation of this act or a rule promulgated under this act." Mich. Comp. Laws Ann. §§ 445.1661(e) (West 2002); 493.56b (West Supp.2005).

[1564] E. John Blanchard, for petitioner.

Robert A. Long, for respondents.

Sri Srinivasan, for the United States as amicus curiae, by special leave of the Court, supporting the respondents.

Michael A. Cox, Attorney General, Thomas L. Casey, Solicitor General, Counsel of Record, Lansing, Michigan, E. John Blanchard, Assistant Attorney General, for Petitioners.

Lori McAllister, William J. Perrone, Dykema Gossett PLLC, Lansing, MI, Robert A. Long, Counsel of Record, Stuart C. Stock, Keith A. Noreika, Emily Johnson Henn, Covington & Burling LLP, Washington, DC, for Respondents.

Justice GINSBURG delivered the opinion of the Court.

Business activities of national banks are controlled by the National Bank Act (NBA or Act), 12 U.S.C. § 1 et seq., and regulations promulgated thereunder by the Office of the Comptroller of the Currency (OCC). See §§ 24, 93a, 371(a). As the agency charged by Congress with supervision of the NBA, OCC oversees the operations of national banks and their interactions with customers. See NationsBank of N. C., N.A. v. Variable Annuity Life Ins. Co., 513 U.S. 251, 254, 256, 115 S.Ct. 810, 130 L.Ed.2d 740 (1995). The agency exercises visitorial powers, including the authority to audit the bank's books and records, largely to the exclusion of other governmental entities, state or federal. See § 484(a); 12 CFR § 7.4000 (2006).

The NBA specifically authorizes federally chartered banks to engage in real estate lending. 12 U.S.C. § 371. It also provides that banks shall have power "[t]o exercise ... all such incidental powers as shall be necessary to carry on the business of banking." § 24 Seventh. Among incidental powers, national banks may conduct certain activities through "operating subsidiaries," discrete entities authorized to engage solely in activities the bank itself could undertake, and subject to the same terms and conditions as those applicable to the bank. See § 24a(g)(3)(A); 12 CFR § 5.34(e) (2006).

Respondent Wachovia Bank, a national bank, conducts its real estate lending business through Wachovia Mortgage Corporation, a wholly owned, state-chartered entity, licensed as an operating subsidiary by OCC. It is uncontested in this suit that Wachovia's real estate business, if conducted by the national bank itself, would be subject to OCC's superintendence, to the exclusion of state registration requirements and visitorial authority. The question in dispute is whether the bank's mortgage lending activities remain outside the governance of state licensing and auditing agencies when those activities are conducted, not by a division or department of the bank, but by the bank's operating subsidiary. In accord with the Courts of Appeals that have addressed the issue,^[1] we hold that Wachovia's mortgage business, whether conducted by the bank itself or through the bank's operating subsidiary, is [1565] subject to OCC's superintendence, and not to the licensing, reporting, and visitorial regimes of the several States in which the subsidiary operates.

I

Wachovia Bank is a national banking association chartered by OCC. Respondent Wachovia Mortgage is a North Carolina corporation that engages in the business of real estate lending in the State of Michigan and elsewhere. Michigan's statutory regime exempts banks, both national and state, from state mortgage lending regulation, but requires mortgage brokers, lenders, and servicers that are subsidiaries of national banks to register with the State's Office of Insurance and Financial Services (OIFS) and submit to state supervision. Mich. Comp. Laws Ann. §§ 445.1656(1), 445.1679(1)(a) (West 2002), 493.52(1), and 493.53a(d) (West 1998).^[2] From 1997 until 2003, Wachovia Mortgage was registered with OIFS to engage in mortgage lending. As a registrant, Wachovia Mortgage was required, inter alia, to pay an annual operating fee, file an annual report, and open its books and records to inspection by OIFS examiners. §§ 445.1657, 445.1658, 445.1671 (West 2002), 493.54, 493.56a(2), (13) (West 1998).

Petitioner Linda Watters, the commissioner of OIFS, administers the State's lending laws. She exercises "general supervision and control" over registered lenders, and has authority to conduct examinations and investigations and to enforce requirements against registrants. See §§ 445.1661, 445.1665, 445.1666 (West 2002), 493.58, 493.56b, 493.59, 493.62a (West 1998 and Supp.2005). She also has authority to investigate consumer complaints and take enforcement action if she finds that a complaint is not "being adequately pursued by the appropriate federal regulatory authority." § 445.1663(2) (West 2002).

On January 1, 2003, Wachovia Mortgage became a wholly owned operating subsidiary of Wachovia Bank. Three months later, Wachovia Mortgage advised the State of Michigan that it was surrendering its mortgage lending registration. Because it had become an operating subsidiary of a national bank, Wachovia Mortgage maintained, Michigan's registration and inspection requirements were preempted. Watters responded with a letter advising Wachovia Mortgage that it would no longer be authorized to conduct mortgage lending activities in Michigan.

Wachovia Mortgage and Wachovia Bank filed suit against Watters, in her official capacity as commissioner, in the United States District Court for the Western District of Michigan. They sought declaratory and injunctive relief prohibiting Watters from enforcing Michigan's registration prescriptions against Wachovia Mortgage, and from interfering with OCC's exclusive visitorial authority. The NBA and regulations promulgated thereunder, they urged, vest supervisory authority in OCC and preempt the application of the state-law controls at issue. Specifically, Wachovia Mortgage and Wachovia Bank challenged as preempted certain provisions of two Michigan statutes—the Mortgage Brokers, Lenders, and Services Licensing Act and the Secondary Mortgage Loan Act. The challenged provisions (1) require mortgage lenders—including national bank operating subsidiaries but not national banks themselves—to register and pay fees to the [1566] State before they may conduct banking activities in Michigan, and authorize the commissioner to deny or revoke registrations, §§ 445.1652(1) (West Supp.2006), 445.1656(1)(d) (West 2002), 445.1657(1), 445.1658, 445.1679(1)(a), 493.52(1) (West 1998), 493.53a(d), 493.54, 493.55(4), 493.56a(2), and 493.61; (2) require submission of annual financial statements to the commissioner and retention of certain documents in a particular format, §§ 445.1657(2) (West 2002), 445.1671, 493.56a(2) (West 1998); (3) grant the commissioner inspection and enforcement authority over registrants, §§ 445.1661 (West 2002), 493.56b (West Supp.2005); and (4) authorize the commissioner to take regulatory or enforcement actions against covered lenders, §§ 445.1665 (West 2002), 445.1666, 493.58-59, and 493.62a (West 1998).

In response, Watters argued that, because Wachovia Mortgage was not itself a national bank, the challenged Michigan controls were applicable and were not preempted. She also contended that the Tenth Amendment to the Constitution of the United States prohibits OCC's exclusive superintendence of national bank lending activities conducted through operating subsidiaries.

The District Court granted summary judgment to the banks in relevant part. 334 F.Supp.2d 957, 966 (W.D.Mich.2004). Invoking the two-step framework of Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), the court deferred to the Comptroller's determination that an operating subsidiary is subject to state regulation only to the extent that the parent bank would be if it performed the same functions. 334 F.Supp.2d, at 963-965 (citing, e.g., 12 CFR §§ 5.34(e)(3), 7.4006 (2004)). The court also rejected Watters' Tenth Amendment argument. 334 F.Supp.2d, at 965-966. The Sixth Circuit affirmed. 431 F.3d 556 (2005). We granted certiorari. 547 U.S. ___, 126 S.Ct. 2900, 165 L.Ed.2d 915 (2006).

II

A

Nearly two hundred years ago, in McCulloch v. Maryland, 4 Wheat. 316, 4 L.Ed. 579 (1819), this Court held federal law supreme over state law with respect to national banking. Though the bank at issue in McCulloch was short-lived, a federal banking system reemerged in the Civil War era. See Atherton v. FDIC, 519 U.S. 213, 221-222, 117 S.Ct. 666, 136 L.Ed.2d 656 (1997); B. Hammond, Banks and Politics in America: from the Revolution to the Civil War (1957). In 1864, Congress enacted the NBA, establishing the system of national banking still in place today. National Bank Act, ch. 106, 13 Stat. 99;^[3]Atherton, 519 U.S., at 222, 117 S.Ct. 666; Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp., 439 U.S. 299, 310, 314-315, 99 S.Ct. 540, 58 L.Ed.2d 534 (1978). The Act vested in nationally chartered banks enumerated powers and "all such incidental powers as shall be necessary to carry on the business of banking." 12 U.S.C. § 24 Seventh. To prevent inconsistent or intrusive state regulation from impairing the national system, Congress provided: "No national bank shall be subject to any visitorial powers except as authorized by Federal law ...." § 484(a).

In the years since the NBA's enactment, we have repeatedly made clear that [1567] federal control shields national banking from unduly burdensome and duplicative state regulation. See, e.g., Beneficial Nat. Bank v. Anderson, 539 U.S. 1, 10, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003) (national banking system protected from "possible unfriendly State legislation" (quoting Tiffany v. National Bank of Mo., 18 Wall. 409, 412, 21 L.Ed. 862 (1874))). Federally chartered banks are subject to state laws of general application in their daily business to the extent such laws do not conflict with the letter or the general purposes of the NBA. Davis v. Elmira Savings Bank, 161 U.S. 275, 290, 16 S.Ct. 502, 40 L.Ed. 700 (1896). See also Atherton, 519 U.S., at 223, 117 S.Ct. 666. For example, state usury laws govern the maximum rate of interest national banks can charge on loans, 12 U.S.C. § 85, contracts made by national banks "are governed and construed by State laws," National Bank v. Commonwealth, 9 Wall. 353, 362, 19 L.Ed. 701 (1870), and national banks' "acquisition and transfer of property [are] based on State law," ibid. However, "the States can exercise no control over [national banks], nor in any wise affect their operation, except in so far as Congress may see proper to permit. Any thing beyond this is an abuse, because it is the usurpation of power which a single State cannot give." Farmers' and Mechanics' Nat. Bank v. Dearing, 91 U.S. 29, 34, 23 L.Ed. 196 (1875) (internal quotation marks omitted).

We have "interpret[ed] grants of both enumerated and incidental `powers' to national banks as grants of authority not normally limited by, but rather ordinarily pre-empting, contrary state law." Barnett Bank of Marion Cty., N.A. v. Nelson, 517 U.S. 25, 32, 116 S.Ct. 1103, 134 L.Ed.2d 237 (1996). See also Franklin Nat. Bank of Franklin Square v. New York, 347 U.S. 373, 375-379, 74 S.Ct. 550, 98 L.Ed. 767 (1954). States are permitted to regulate the activities of national banks where doing so does not prevent or significantly interfere with the national bank's or the national bank regulator's exercise of its powers. But when state prescriptions significantly impair the exercise of authority, enumerated or incidental under the NBA, the State's regulations must give way. Barnett Bank, 517 U.S., at 32-34, 116 S.Ct. 1103 (federal law permitting national banks to sell insurance in small towns preempted state statute prohibiting banks from selling most types of insurance); Franklin Nat. Bank, 347 U.S., at 377-379, 74 S.Ct. 550 (local restrictions preempted because they burdened exercise of national banks' incidental power to advertise).

The NBA authorizes national banks to engage in mortgage lending, subject to OCC regulation. The Act provides:

"Any national banking association may make, arrange, purchase or sell loans or extensions of credit secured by liens on interests in real estate, subject to 1828(o) of this title and such restrictions and requirements as the Comptroller of the Currency may prescribe by regulation or order." 12 U.S.C. § 371(a).^[4]

Beyond genuine dispute, state law may not significantly burden a national bank's own exercise of its real estate lending power, just as it may not curtail or hinder a national bank's efficient exercise of any other power, incidental or enumerated under [1568] the NBA. See Barnett Bank, 517 U.S., at 33-34, 116 S.Ct. 1103; Franklin, 347 U.S., at 375-379, 74 S.Ct. 550. See also 12 CFR § 34.4(a)(1) (2006) (identifying preempted state controls on mortgage lending, including licensing and registration). In particular, real estate lending, when conducted by a national bank, is immune from state visitorial control: The NBA specifically vests exclusive authority to examine and inspect in OCC. 12 U.S.C. § 484(a) ("No national bank shall be subject to any visitorial powers except as authorized by Federal law.").^[5]

Harmoniously, the Michigan provisions at issue exempt national banks from coverage. Mich. Comp. Laws Ann. § 445.1675(a) (West 2002). This is not simply a matter of the Michigan Legislature's grace. Cf. post, at 1570-1571, and n. 17. For, as the parties recognize, the NBA would have preemptive force, i.e., it would spare a national bank from state controls of the kind here involved. See Brief for Petitioner 12; Brief for Respondents 14; Brief for United States as Amicus Curiae 9. State laws that conditioned national banks' real estate lending on registration with the State, and subjected such lending to the State's investigative and enforcement machinery would surely interfere with the banks' federally authorized business: National banks would be subject to registration, inspection, and enforcement regimes imposed not just by Michigan, but by all States in which the banks operate.^[6] Diverse and duplicative superintendence of national banks' engagement in the business of banking, we observed over a century ago, is precisely what the NBA was designed to prevent: "Th[e] legislation has in view the erection of a system extending throughout the country, and independent, so far as powers conferred are concerned, of state legislation which, if permitted to be applicable, might impose limitations and restrictions as various and as numerous as the States." Easton v. Iowa, 188 U.S. 220, 229, 23 S.Ct. 288, 47 L.Ed. 452 (1903). Congress did not intend, we explained, "to leave the field open for the States to attempt to promote the welfare and stability of national banks by direct legislation .... [C]onfusion would necessarily result from control possessed and exercised by two independent authorities." Id., at 231-232, 23 S.Ct. 288.

Recognizing the burdens and undue duplication state controls could produce, Congress included in the NBA an express command: "No national bank shall be subject to any visitorial powers except as authorized by Federal law ... ." 12 U.S.C. § 484(a). See supra, at 1566, 1568; post, at 1569 (acknowledging that national banks have been "exemp[t] from state visitorial authority ... for more than 140 years"). "Visitation," we have explained "is the act of a superior or superintending officer, who visits a corporation to examine into its manner of conducting business, and enforce an observance of its laws and regulations." Guthrie v. Harkness, 199 U.S. 148, 158, 26 S.Ct. 4, 50 L.Ed. 130 (1905) (internal quotation marks omitted). See also 12 CFR § 7.4000(a)(2) (2006) (defining "visitorial" power as "(i) [e]xamination of a bank; (ii) [i]nspection of a bank's books and records; (iii) [r]egulation and supervision of [1569] activities authorized or permitted pursuant to federal banking law; and (iv)[e]nforcing compliance with any applicable federal or state laws concerning those activities"). Michigan, therefore, cannot confer on its commissioner examination and enforcement authority over mortgage lending, or any other banking business done by national banks.^[7]

B

While conceding that Michigan's licensing, registration, and inspection requirements cannot be applied to national banks, see, e.g., Brief for Petitioner 10, 12, Watters argues that the State's regulatory regime survives preemption with respect to national banks' operating subsidiaries. Because such subsidiaries are separately chartered under some State's law, Watters characterizes them simply as "affiliates" of national banks, and contends that even though they are subject to OCC's superintendence, they are also subject to multistate control. Id., at 17-22. We disagree.

Since 1966, OCC has recognized the "incidental" authority of national banks under § 24 Seventh to do business through operating subsidiaries. See 31 Fed.Reg. 11459-11460 (1966); 12 CFR § 5.34(e)(1) (2006) ("A national bank may conduct in an operating subsidiary activities that are permissible for a national bank to engage in directly either as part of, or incidental to, the business of banking...."). That authority is uncontested by Michigan's commissioner. See Brief for Petitioner 21 ("[N]o one disputes that 12 U.S.C. § 24 (Seventh) authorizes national banks to use nonbank operating subsidiaries ... ."). OCC licenses and oversees national bank operating subsidiaries just as it does national banks. § 5.34(e)(3) ("An operating subsidiary conducts activities authorized under this section pursuant to the same authorization, terms and conditions that apply to the conduct of such activities by its parent national bank.");^[8] United States [1570] Office of the Comptroller of the Currency, Related Organizations: Comptroller's Handbook 53 (Aug.2004) (hereinafter Comptroller's Handbook) ("Operating subsidiaries are subject to the same supervision and regulation as the parent bank, except where otherwise provided by law or OCC regulation.").

In 1999, Congress defined and regulated "financial" subsidiaries; simultaneously, Congress distinguished those national bank affiliates from subsidiaries—typed "operating subsidiaries" by OCC—which may engage only in activities national banks may engage in directly, "subject to the same terms and conditions that govern the conduct of such activities by national banks." Gramm-Leach-Bliley Act (GLBA), § 121(a)(2), 113 Stat. 1378 (codified at 12 U.S.C. § 24a(g)(3)(A)).^[9] For supervisory purposes, OCC treats national banks and their operating subsidiaries as a single economic enterprise. Comptroller's Handbook 64. OCC oversees both entities by reference to "business line," applying the same controls whether banking "activities are conducted directly or through an operating subsidiary." Ibid.^[10]

As earlier noted, Watters does not contest the authority of national banks to do business through operating subsidiaries. Nor does she dispute OCC's authority to supervise and regulate operating subsidiaries in the same manner as national banks. Still, Watters seeks to impose state regulation on operating subsidiaries over and above regulation undertaken by OCC. But just as duplicative state examination, supervision, and regulation would significantly burden mortgage lending when engaged in by national banks, see supra, at 1566-1569, so too would those state controls interfere with that same activity when engaged in by an operating subsidiary.

We have never held that the preemptive reach of the NBA extends only to a national bank itself. Rather, in analyzing whether state law hampers the federally permitted activities of a national bank, we have focused on the exercise of a national bank's powers, not on its corporate structure. See, e.g., Barnett Bank, 517 U.S., at 32, 116 S.Ct. 1103. And we have treated operating subsidiaries as equivalent to national [1571] banks with respect to powers exercised under federal law (except where federal law provides otherwise). In NationsBank of N. C., N. A., 513 U.S., at 256-261, 115 S.Ct. 810, for example, we upheld OCC's determination that national banks had "incidental" authority to act as agents in the sale of annuities. It was not material that the function qualifying as within "the business of banking," § 24 Seventh, was to be carried out not by the bank itself, but by an operating subsidiary, i.e., an entity "subject to the same terms and conditions that govern the conduct of [the activity] by national banks [themselves]." § 24a(g)(3)(A); 12 CFR § 5.34(e)(3) (2006). See also Clarke v. Securities Industry Assn., 479 U.S. 388, 107 S.Ct. 750, 93 L.Ed.2d 757 (1987) (national banks, acting through operating subsidiaries, have power to offer discount brokerage services).^[11]

Security against significant interference by state regulators is a characteristic condition of the "business of banking" conducted by national banks, and mortgage lending is one aspect of that business. See, e.g., 12 U.S.C. § 484(a); 12 CFR § 34.4(a)(1) (2006). See also supra, at 1566-1569; post, at 1576 (acknowledging that, in 1982, Congress broadly authorized national banks to engage in mortgage lending); post, at 1581, and n. 20 (acknowledging that operating subsidiaries "are subject to the same federal oversight as their national bank parents"). That security should adhere whether the business is conducted by the bank itself or is assigned to an operating subsidiary licensed by OCC whose authority to carry on the business coincides completely with that of the bank. See Wells Fargo Bank, N.A. v. Boutris, 419 F.3d 949, 960 (C.A.9 2005) (determination whether to conduct business through operating subsidiaries or through subdivisions is "essentially one of internal organization").

Watters contends that if Congress meant to deny States visitorial powers over operating subsidiaries, it would have written § 484(a)'s ban on state inspection to apply not only to national banks but also to their affiliates. She points out that § 481, which authorizes OCC to examine "affiliates" of national banks, does not speak to state visitorial powers. This argument fails for two reasons. First, one cannot ascribe any intention regarding operating subsidiaries to the 1864 Congress that enacted §§ 481 and 484, or the 1933 Congress that added the provisions on examining affiliates to § 481 and the definition of "affiliate" to § 221a. That is so because operating subsidiaries were not authorized until 1966. See supra, at 1569-1570. Over the past four decades, during which operating subsidiaries have emerged as important instrumentalities of national banks, Congress and OCC have indicated no doubt that such subsidiaries are "subject to the same terms and conditions" as national banks themselves.

Second, Watters ignores the distinctions Congress recognized among "affiliates." The NBA broadly defines the term "affiliate" to include "any corporation" controlled by a national bank, including a subsidiary. See 12 U.S.C. § 221a(b). An operating subsidiary is therefore one type of "affiliate." But unlike affiliates that may engage in functions not authorized by the NBA, e.g., financial subsidiaries, an operating subsidiary is tightly tied to its parent by the specification that it may [1572] engage only in "the business of banking" as authorized by the Act. § 24a(g)(3)(A); 12 CFR § 5.34(e)(1) (2006). See also supra, at 1569-1570, and 1576 n. 10. Notably, when Congress amended the NBA confirming that operating subsidiaries may "engag[e] solely in activities that national banks are permitted to engage in directly," 12 U.S.C. § 24a(g)(3)(A), it did so in an Act, the GLBA, providing that other affiliates, authorized to engage in nonbanking financial activities, e.g., securities and insurance, are subject to state regulation in connection with those activities. See, e.g., §§ 1843(k), 1844(c)(4). See also 15 U.S.C. § 6701(b) (any person who sells insurance must obtain a state license to do so).^[12]

C

Recognizing the necessary consequence of national banks' authority to engage in mortgage lending through an operating subsidiary "subject to the same terms and conditions that govern the conduct of such activities by national banks," 12 U.S.C. § 24a(g)(3)(A), see also § 24 Seventh, OCC promulgated 12 CFR § 7.4006 (2006): "Unless otherwise provided by Federal law or OCC regulation, State laws apply to national bank operating subsidiaries to the same extent that those laws apply to the parent national bank." See Investment Securities; Bank Activities & Operations; Leasing, 66 Fed. Reg. 34784, 34788 (2001). Watters disputes the authority of OCC to promulgate this regulation and contends that, because preemption is a legal question for determination by courts, § 7.4006 should attract no deference. See also post, at 1582-1585. This argument is beside the point, for under our interpretation of the statute, the level of deference owed to the regulation is an academic question. Section 7.4006 merely clarifies and confirms what the NBA already conveys: A national bank has the power to engage in real estate lending through an operating subsidiary, subject to the same terms and conditions that govern the national bank itself; that power cannot be significantly impaired or impeded by state law. See, e.g., Barnett Bank, 517 U.S., at 33-34, 116 S.Ct. 1103; 12 U.S.C. §§ 24 Seventh, 24a(g)(3)(A), 371.^[13]

The NBA is thus properly read by OCC to protect from state hindrance a national bank's engagement in the "business of banking" whether conducted by the bank itself or by an operating subsidiary, empowered to do only what the bank itself could do. See supra, at 1569-1570. The authority to engage in the business of mortgage lending comes from the NBA, § 371, as does the authority to conduct business through an operating subsidiary. See §§ 24 Seventh, 24a(g)(3)(A). That Act vests visitorial oversight in OCC, not state regulators. § 484(a). State law (in this [1573] case, North Carolina law), all agree, governs incorporation-related issues, such as the formation, dissolution, and internal governance of operating subsidiaries.^[14] And the laws of the States in which national banks or their affiliates are located govern matters the NBA does not address. See supra, at 1566-1567. But state regulators cannot interfere with the "business of banking" by subjecting national banks or their OCC-licensed operating subsidiaries to multiple audits and surveillance under rival oversight regimes.

III

Watters' alternative argument, that 12 CFR § 7.4006 violates the Tenth Amendment to the Constitution, is unavailing. As we have previously explained, "[i]f a power is delegated to Congress in the Constitution, the Tenth Amendment expressly disclaims any reservation of that power to the States." New York v. United States, 505 U.S. 144, 156, 112 S.Ct. 2408, 120 L.Ed.2d 120 (1992). Regulation of national bank operations is a prerogative of Congress under the Commerce and Necessary and Proper Clauses. See Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 58, 123 S.Ct. 2037, 156 L.Ed.2d 46 (2003) (per curiam). The Tenth Amendment, therefore, is not implicated here.

* * *

For the reasons stated, the judgment of the Sixth Circuit is

Affirmed.

Justice THOMAS took no part in the consideration or decision of this case.

Justice STEVENS, with whom THE CHIEF JUSTICE and Justice SCALIA join, dissenting.

Congress has enacted no legislation immunizing national bank subsidiaries from compliance with nondiscriminatory state laws regulating the business activities of mortgage brokers and lenders. Nor has it authorized an executive agency to preempt such state laws whenever it concludes that they interfere with national bank activities. Notwithstanding the absence of relevant statutory authority, today the Court endorses an agency's incorrect determination that the laws of a sovereign State must yield to federal power. The significant impact of the Court's decision on the federal-state balance and the dual banking system makes it appropriate to set forth in full the reasons for my dissent.

I

The National Bank Act (or NBA), 13 Stat. 99, authorized the incorporation of national banks, § 5, id., at 98, and granted them "all such incidental powers as shall be necessary to carry on the business of banking," § 8, id., at 98 (codified at 12 U.S.C. § 24 Seventh), subject to regulatory oversight by the Comptroller of the Currency, § 54, 13 Stat. 116. To maintain a meaningful role for state legislation and for state corporations that did not engage in core banking activities, Congress circumscribed national bank authority. Notably, national banks were expressly forbidden from making mortgage loans, § 28, id., at 108.^[15] Moreover, the shares of national [1574] banks, as well their real estate holdings, were subject to nondiscriminatory state taxation, § 41, id., at 111; and while national banks could lend money, state law capped the interest rates they could charge, § 20, id., at 105.

Originally, it was anticipated that "existing banks would surrender their state charters and re-incorporate under the terms of the new law with national charters."^[16] That did not happen. Instead, after an initial post-National Bank Act decline, state-chartered institutions thrived.^[17] What emerged was the competitive mix of state and national banks known as the dual banking system.

This Court has consistently recognized that because federal law is generally interstitial, national banks must comply with most of the same rules as their state counterparts. As early as 1870, we articulated the principle that has remained the lodestar of our jurisprudence: that national banks

"are only exempted from State legislation, so far as that legislation may interfere with, or impair their efficiency in performing the functions by which they are designed to serve that government.... They are subject to the laws of the State, and are governed in their daily course of business far more by the laws of the State than of the nation. All their contracts are governed and construed by State laws. Their acquisition and transfer of property, their right to collect their debts, and their liability to be sued for debts, are all based on State law. It is only when the State law incapacitates the banks from discharging their duties to the government that it becomes unconstitutional." National Bank v. Commonwealth, 9 Wall. 353, 362, 19 L.Ed. 701 (1870) (emphasis added).^[18]

Until today, we have remained faithful to the principle that nondiscriminatory laws of general application that do not "forbid" or "impair significantly" national bank activities should not be preempted. See, e.g., Barnett Bank of Marion Cty., N.A. v. Nelson, 517 U.S. 25, 33, 116 S.Ct. 1103, 134 L.Ed.2d 237 (1996).^[19]

Nor is the Court alone in recognizing the vital role that state legislation plays in the dual banking system. Although the dual banking system's main virtue is its divergent treatment of national and state [1575] banks,^[20] Congress has consistently recognized that state law must usually govern the activities of both national and state banks for the dual banking system to operate effectively. As early as 1934, Justice Brandeis observed for the Court that this congressional recognition is embodied in a long string of statutes:

"The policy of equalization was adopted in the National Bank Act of 1864, and has ever since been applied, in the provision concerning taxation. In amendments to that act and in the Federal Reserve Act and amendments thereto the policy is expressed in provisions conferring power to establish branches; in those conferring power to act as fiduciary; in those concerning interest on deposits; and in those concerning capitalization. It appears also to have been of some influence in securing the grant in 1913 of the power to loan on mortgage." Lewis v. Fidelity & Deposit Co. of Md., 292 U.S. 559, 564-565, 54 S.Ct. 848, 78 L.Ed. 1425 (footnotes, with citations to relevant statutes, omitted).^[21]

For the same reasons, we observed in First Nat. Bank in Plant City v. Dickinson, 396 U.S. 122, 133, 90 S.Ct. 337, 24 L.Ed.2d 312 (1969), that "[t]he policy of competitive equality is ... firmly embedded in the statutes governing the national banking system." So firmly embedded, in fact, that "the congressional policy of competitive equality with its deference to state standards" is not "open to modification by the Comptroller of the Currency." Id., at 138, 90 S.Ct. 337.

II

Although the dual banking system has remained intact, Congress has radically transformed the national bank system from its Civil War antecedent and brought considerably more federal authority to bear on state-chartered institutions. Yet despite all the changes Congress has made to the national bank system, and despite its exercise of federal power over state banks, it has never preempted state laws like those at issue in this case.

Most significantly, in 1913 Congress established the Federal Reserve System to oversee federal monetary policy through its influence over the availability of credit. Federal Reserve Act §§ 2, 9, 38 Stat. 252, 259. The Act required national banks and permitted state banks to become Federal Reserve member banks, and subjected all member banks to Federal Reserve regulations and oversight. Ibid. Also of signal importance, after the banking system collapsed during the Great Depression, Congress required all member banks to obtain deposit insurance from the newly established Federal Deposit Insurance Corporation. Banking Act of 1933 (or Glass-Steagall Act), § 8, 48 Stat. 168; see also Banking Act of 1935, 49 Stat. 684. Although both of these steps meant that many state banks were subjected to significant federal regulation,^[22] "the state banking system continued along with the national [1576] banking system, with no attempt to exercise preemptive federal regulatory authority over the activities of the existing state banks." M. Malloy, Banking and Financial Services Law 48 (2d ed.2005).

In addition to these systemic overhauls, Congress has over time modified the powers of national banks. The changes are too various to recount in detail, but two are of particular importance to this case. First, Congress has gradually relaxed its prohibition on mortgage lending by national banks. In 1913, Congress permitted national banks to make loans secured by farm land, Federal Reserve Act, § 24, 38 Stat. 273, and in succeeding years, their mortgage-lending power was enlarged to cover loans on real estate in the vicinity of the bank, Act of Sept. 7, 1916, 39 Stat. 754, and loans "secured by first liens upon forest tracts which are properly managed in all respects," Act of Aug. 15, 1953, ch. 510, 67 Stat. 614. Congress substantially expanded national banks' power to make real estate loans in 1974, see Housing and Community Development Act, Title VII, § 711, 88 Stat 716, and in 1982 it enacted the broad language, now codified at 12 U.S.C. § 371(a), authorizing national banks to make "loans ... secured by liens on interests in real estate." Garn-St Germain Depository Institutions Act of 1982, Title IV, § 403, 96 Stat. 1510. While these changes have enabled national banks to engage in more evenhanded competition with state banks, they certainly reflect no purpose to give them any competitive advantage.^[23]

Second, Congress has over the years both curtailed and expanded the ability of national banks to affiliate with other companies. In the early part of the century, banks routinely engaged in investment activities and affiliated with companies that did the same. The Glass-Steagall Act put an end to that. "[E]nacted in 1933 to protect bank depositors from any repetition of the widespread bank closings that occurred during the Great Depression," Board of Governors, FRS v. Investment Company Institute, 450 U.S. 46, 61, 101 S.Ct. 973, 67 L.Ed.2d 36 (1981), Glass-Steagall prohibited Federal Reserve member banks (both state and national) from affiliating with investment banks.^[24] In Congress' view, the affiliates had engaged in speculative activities that in turn contributed to commercial banks' Depression-era failures.^[25] It was this focus on the welfare of depositors—as opposed to stockholders—that provided the basis for legislative action designed to ensure bank solvency.

A scant two years later, Congress forbade national banks from owning the [1577] shares of any company because of a similar fear that such ownership could undermine the safety and soundness of national banks:^[26] "Except as hereinafter provided or otherwise permitted by law, nothing herein contained shall authorize the purchase by [a national bank] for its own account of any shares of stock of any corporation." Banking Act of 1935, § 308(b), 49 Stat. 709 (emphasis added). That provision remains on the books today. See 12 U.S.C. § 24 Seventh.

These congressional restrictions did not forbid all affiliations, however, and national banks began experimenting with new corporate forms. One of those forms involved the national bank ownership of "operating subsidiaries." In 1966, the Comptroller of the Currency took the position "that a national bank may acquire and hold the controlling stock interest in a subsidiary operations corporation" so long as that corporation's "functions or activities ... are limited to one or several of the functions or activities that a national bank is authorized to carry on." 31 Fed.Reg. 11459 (1966). The Comptroller declined to read the categorical prohibition on national bank ownership of stock to foreclose bank ownership of operating subsidiaries, finding authority for this aggressive interpretation of national bank authority in the "incidental powers" provision of 12 U.S.C. § 24 Seventh. See 31 Fed.Reg. 11460.

While Congress eventually restricted some of the new corporate structures,^[27] it neither disavowed nor endorsed the Comptroller's position on national bank ownership of operating subsidiaries. Notwithstanding the congressional silence, in 1996 the OCC once again attempted to expand national banks' ownership powers. The agency issued a regulation permitting national bank operating subsidiaries to undertake activities that the bank was not allowed to engage in directly. 12 CFR §§ 5.34(d), (f) (1997) (authorizing national banks to "acquire or establish an operating subsidiary to engage in [activities] different from that permissible for the parent national bank," so long as those activities are "part of or incidental to the business of banking, as determined by the Comptroller of the Currency"); see also 61 Fed. Reg. 60342 (1996).

Congress overruled this OCC regulation in 1999 in the Gramm-Leach-Bliley Act (GLBA), 113 Stat. 1338. The GLBA was a seminal piece of banking legislation inasmuch as it repealed the Glass-Steagall Act's ban on affiliations between commercial and investment banks. See § 101, id., at 1341. More relevant to this case, however, the GLBA addressed the powers of national banks to own subsidiary corporations. The Act provided that any national bank subsidiary engaging in activities forbidden to the parent bank would be considered a "financial subsidiary," § 121, id., at 1380, and would be subjected to heightened regulatory obligations, see, e.g., 12 U.S.C. § 371c-1(a)(1). The GLBA's definition of "financial subsidiaries" excluded those subsidiaries that "engag[e] solely in activities that national banks are permitted to engage in directly and are conducted subject to the same terms and conditions that govern the conduct of such activities by national banks." § 24a(g)(3).

By negative implication, then, only subsidiaries engaging in purely national bank activities—which the OCC had termed "operating subsidiaries," but which the GLBA never mentions by name—could avoid being subjected to the restrictions that applied to financial subsidiaries. Compare [1578] § 371c(b)(2) (exempting subsidiaries from certain regulatory restrictions) with § 371c(e) (clarifying that financial subsidiaries are not to be treated as "subsidiaries"). Taken together, these provisions worked a rejection of the OCC's position that an operating subsidiary could engage in activities that national banks could not engage in directly.^[28] See § 24a(g)(3). Apart from this implicit rejection of the OCC's 1996 regulation, however, the GLBA does not even mention operating subsidiaries.

In sum, Congress itself has never authorized national banks to use subsidiaries incorporated under state law to perform traditional banking functions. Nor has it authorized OCC to "license" any state-chartered entity to do so. The fact that it may have acquiesced in the OCC's expansive interpretation of its authority is a plainly insufficient basis for finding preemption.

III

It is familiar learning that "[t]he purpose of Congress is the ultimate touchstone of pre-emption analysis." Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992) (internal quotation marks omitted). In divining that congressional purpose, I would have hoped that the Court would hew both to the NBA's text and to the basic rule, central to our federal system, that "[i]n all pre-emption cases ... we `start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.'" Medtronic, Inc. v. Lohr, 518 U.S. 470, 485, 116 S.Ct. 2240, 135 L.Ed.2d 700 (1996) (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 91 L.Ed. 1447 (1947)). Had it done so, it could have avoided the untenable conclusion that Congress meant the NBA to preempt the state laws at issue here.

The NBA in fact evinces quite the opposite congressional purpose. It provides in 12 U.S.C. § 484(a) that "[n]o national bank shall be subject to any visitorial powers except as authorized by Federal law." Although this exemption from state visitorial authority has been in place for more than 140 years, see § 54, 13 Stat. 116 (national banks "shall not be subject to any other visitorial powers than such as are authorized by this act"), it is significant that Congress has never extended 12 U.S.C. § 484(a)'s preemptive blanket to cover national bank subsidiaries.

This is not, contrary to the Court's suggestion, see ante, at 1571-1572, some kind of oversight. As the complex history of the banking laws demonstrates, Congress has legislated extensively with respect to national bank "affiliates"—an operating subsidiary is one type of affiliate^[29]—and has moreover given the OCC extensive supervisory powers over those affiliates, see § 481 (providing that a federal examiner "shall have power to make a thorough examination of all the affairs of [a national bank] affiliate, and in doing so he shall [1579] have power ... to make a report of his findings to the Comptroller of the Currency"). That Congress lavished such attention on national bank affiliates and conferred such far-reaching authority on the OCC without ever expanding the scope of § 484(a) speaks volumes about Congress' preemptive intent, or rather its lack thereof. Consistent with our presumption against preemption—a presumption I do not understand the Court to reject—I would read § 484(a) to reflect Congress' considered judgment not to preempt the application of state visitorial laws to national bank "affiliates."

Instead, the Court likens § 484(a) to a congressional afterthought, musing that it merely "recogniz[es] the burdens and undue duplication that state controls could produce." Ante, at 1568. By that logic, I take it the Court believes that the NBA would impliedly preempt all state visitorial laws as applied to national banks even if § 484(a) did not exist. That is surprising and unlikely. Not only would it reduce the NBA's express preemption provision to so much surplusage, but it would give Congress' silence greater statutory dignity than an express command. Perhaps that explains why none of the four Circuits to have addressed this issue relied on the preemptive force of the NBA itself. Each instead asked whether the OCC's regulations preempted state laws.^[30] Stranger still, the Court's reasoning would suggest that operating subsidiaries have been exempted from state visitorial authority from the moment the OCC first authorized them in 1966. See 31 Fed.Reg. 11459. Yet if that were true, surely at some point over the last 40 years some national bank would have gone to court to spare its subsidiaries from the yoke of state regulation; national banks are neither heedless of their rights nor shy of litigation. But respondents point us to no such cases that predate the OCC's preemption regulations.

The Court licenses itself to ignore § 484(a)'s limits by reasoning that "when state prescriptions significantly impair the exercise of authority, enumerated or incidental under the NBA, the State's regulations must give way." Ante, at 1567. But it intones this "significant impairment" refrain without remembering that it merely provides a useful tool—not the only tool, and not even the best tool—to discover congressional intent. As we explained in Barnett Bank, this Court "take[s] the view that normally Congress would not want States to forbid, or to impair significantly, the exercise of a power that Congress has explicitly granted." 517 U.S., at 33, 116 S.Ct. 1103 (emphasis added). But any assumption about what Congress "normally" wants is of little moment when Congress has said exactly what it wants.

The Court also puts great weight on Barnett Bank's reference to our "history... of interpreting grants of both enumerated and incidental `powers' to national banks as grants of authority not normally limited by, but rather ordinarily pre-empting, contrary state law." Id., at 32, 116 S.Ct. 1103. The Court neglects to mention that Barnett Bank is quite clear that this interpretive rule applies only when Congress has failed (as it often does) to manifest an explicit preemptive intent. Id., at 31, 116 S.Ct. 1103. "In that event, courts must consider whether the federal statute's `structure and purpose,' or nonspecific statutory language, nonetheless reveal a [1580] clear, but implicit, pre-emptive intent." Ibid. (emphasis added). Barnett Bank nowhere holds that we can ignore strong indicia of congressional intent whenever a state law arguably trenches on national bank powers. After all, the case emphasized that the question of preemption "is basically one of congressional intent. Did Congress, in enacting the Federal Statute, intend to exercise its constitutionally delegated authority to set aside the laws of a State?" Id., at 30, 116 S.Ct. 1103. The answer here is a resounding no.

Even if it were appropriate to delve into the significant impairment question, the history of this very case confirms that neither the Mortgage Brokers, Lenders, and Services Licensing Act, Mich. Comp. Laws Ann. § 445.1651 et seq. (West 2002 and Supp.2006), nor the Secondary Mortgage Loan Act, § 493.51 et seq. (West 2005), conflicts with "the letter or the general objects and purposes of Congressional legislation." Davis v. Elmira Savings Bank, 161 U.S. 275, 290, 16 S.Ct. 502, 40 L.Ed. 700 (1896). Enacted to protect consumers from mortgage lending abuses, the Acts require mortgage brokers, mortgage servicers, and mortgage lenders to register with the State, §§ 445.1652(1) (West Supp.2006), 493.52(1) (West 2005), to submit certain financial statements, §§ 445.1657(2) (West 2002), 493.56a(2) (West 2005), and to submit to state visitorial oversight, §§ 445.1661 (West 2002), 493.56b (West 2005). Because the Acts expressly provide that they do not apply to "depository financial institution[s]," § 445.1675(a) (West 2002), neither national nor state banks are covered.^[31] The statute therefore covers only nonbank companies incorporated under state law.^[32]

Respondent Wachovia Mortgage Corporation has never engaged in the core banking business of accepting deposits. In 1997, when Wachovia Mortgage was first licensed to do business in Michigan, it was owned by a holding company that also owned the respondent Wachovia Bank, N.A. (Neither the holding company nor the Bank did business in Michigan.) There is no evidence, and no reason to believe, that compliance with the Michigan statutes imposed any special burdens on Wachovia Mortgage's activities, or that the transfer in 2003 of its ownership from the holding company to the Bank required it to make any changes whatsoever in its methods of doing business. Neither before nor after that transfer was there any discernible federal interest in granting the company immunity from regulations that applied evenhandedly to its competitors. The mere fact that its activities may also be performed by its banking parent provides at best a feeble justification for immunizing it from state regulation. And it is a justification that the longstanding congressional "policy of competitive equality" clearly outweighs. See Plant City, 396 U.S., at 133, 90 S.Ct. 337.

Again, however, it is beside the point whether in the Court's judgment the Michigan laws will hamper national banks' ability to carry out their banking functions through operating subsidiaries. It is Congress' [1581] judgment that matters here, and Congress has in the NBA preempted only those laws purporting to lodge with state authorities visitorial power over national banks. 12 U.S.C. § 484(a). In my view, the Court's eagerness to infuse congressional silence with preemptive force threatens the vitality of most state laws as applied to national banks—a result at odds with the long and unbroken history of dual state and federal authority over national banks, not to mention our federal system of government. It is especially troubling that the Court so blithely preempts Michigan laws designed to protect consumers. Consumer protection is quintessentially a "field which the States have traditionally occupied," Rice, 331 U.S., at 230, 67 S.Ct. 1146;^[33] the Court should therefore have been all the more reluctant to conclude that the "clear and manifest purpose of Congress" was to set aside the laws of a sovereign State, ibid.

IV

Respondents maintain that even if the NBA lacks preemptive force, the GLBA's use of the phrase "same terms and conditions" reflects a congressional intent to preempt state laws as they apply to the mortgage lending activities of operating subsidiaries. See 12 U.S.C. § 24a(g)(3). Indeed, the Court obliquely suggests as much, salting its analysis of the NBA with references to the GLBA. See ante, at 1570-1571, 1571-1572. Even a cursory review of the GLBA's text shows that it cannot bear the preemptive weight respondents (and perhaps the Court) would assign to it.

The phrase "same terms and conditions" appears in the definition of "financial subsidiary," not in a provision of the statute conferring national bank powers. Even there, it serves only to describe what a financial subsidiary is not. See § 24a(g)(3) (defining financial subsidiary as any subsidiary "other than a subsidiary that ... engages solely in activities that national banks are permitted to engage in directly and are conducted subject to the same terms and conditions that govern the conduct of such activities by national banks"). Apart from this slanting reference, the GLBA never mentions operating subsidiaries. Far from a demonstration that the "clear and manifest purpose of Congress" was to preempt the type of law at issue here, Rice, 331 U.S., at 230, 67 S.Ct. 1146, the "same terms and conditions" language at most reflects an uncontroversial acknowledgment that operating subsidiaries of national banks are subject to the same federal oversight as their national bank parents.^[34] It has nothing to do with preemption.

Congress in fact disavowed any such preemptive intent. Section 104 of the GLBA is titled "Operation of State Law," 113 Stat. 1352, and it devotes more than 3,000 words to explaining which state laws Congress meant the GLBA to preempt. Leave aside the oddity of a Congress that addresses preemption in exquisite detail in one provision of the GLBA but (according to respondents) uses only four words to express a preemptive intent elsewhere in the statute. More importantly, § 104(d)(4) provides that "[n]o State statute ... shall be preempted" by the GLBA unless that statute has a disparate impact on federally chartered depository institutions, "prevent[s] [1582] a depository institution or affiliate thereof from engaging in activities authorized or permitted by this Act," or "conflict[s] with the intent of this Act generally to permit affiliations that are authorized or permitted by Federal law." Id., at 1357 (emphasis added) (codified at 15 U.S.C. § 6701(d)(4)). No one claims that the Michigan laws at issue here are discriminatory, forbid affiliations, or "prevent" any operating subsidiary from engaging in banking activities. It necessarily follows that the GLBA does not preempt them.

Even assuming that the phrase has something to do with preemption, it is simply not the case that the nonencroachment of state regulation is a "term and condition" of engagement in the business of banking. As a historical matter, state laws have always applied to national banks and have often encroached on the business of banking. See National Bank, 9 Wall., at 362, 19 L.Ed. 701 (observing that national banks "are subject to the laws of the State, and are governed in their daily course of business far more by the laws of the State than of the nation"). The Court itself acknowledges that state usury, contract, and property law govern the activities of national banks and their subsidiaries, ante, at 1566-1567, notwithstanding that they vary across "all States in which the banks operate," ante, at 1568. State law has always provided the legal backdrop against which national banks make real estate loans, and "[t]he fact that the banking agencies maintain a close surveillance of the industry with a view toward preventing unsound practices that might impair liquidity or lead to insolvency does not make federal banking regulation all-pervasive." United States v. Philadelphia Nat. Bank, 374 U.S. 321, 352, 83 S.Ct. 1715, 10 L.Ed.2d 915 (1963).

V

In my view, the most pressing questions in this case are whether Congress has delegated to the Comptroller of the Currency the authority to preempt the laws of a sovereign State as they apply to operating subsidiaries, and if so, whether that authority was properly exercised here. See 12 CFR § 7.4006 (2006) ("State laws apply to national bank operating subsidiaries to the same extent that those laws apply to the parent national bank"). Without directly answering either question, the Court concludes that preemption is the "necessary consequence" of various congressional statutes. Ante, at 1571-1572. Because I read those statutes differently, I must consider (as did the four Circuits to have addressed this issue) whether an administrative agency can assume the power to displace the duly enacted laws of a state legislature.

To begin with, Congress knows how to authorize executive agencies to preempt state laws.^[35] It has not done so here. Nor does the statutory provision authorizing banks to engage in certain lines of business that are "incidental" to their primary business of accepting and managing the funds of depositors expressly or implicitly grant the OCC the power to immunize [1583] banks or their subsidiaries from state regulation.^[36] See 12 U.S.C. § 24 Seventh. For there is a vast and obvious difference between rules authorizing or regulating conduct and rules granting immunity from regulation. The Comptroller may well have the authority to decide whether the activities of a mortgage broker, a real estate broker, or a travel agent should be characterized as "incidental" to banking, and to approve a bank's entry into those businesses, either directly or through its subsidiaries. See, e.g., NationsBank of N.C., N.A. v. Variable Annuity Life Ins. Co., 513 U.S. 251, 258, 115 S.Ct. 810, 130 L.Ed.2d 740 (1995) (upholding the OCC's interpretation of the "incidental powers" provision to permit national banks to serve as agents in annuity sales). But that lesser power does not imply the far greater power to immunize banks or their subsidiaries from state laws regulating the conduct of their competitors.^[37] As we said almost 40 years ago, "the congressional policy of competitive equality with its deference to state standards" is not "open to modification by the Comptroller of the Currency." Plant City, 396 U.S., at 138, 90 S.Ct. 337.^[38]

Were I inclined to assume (and I am not) that congressional silence should be read as a conferral of preemptive authority, I would not find that the OCC has actually exercised any such authority here. When the agency promulgated 12 CFR § 7.4006, it explained that "[t]he section itself does not effect preemption of any [1584] State law; it reflects the conclusion we believe a Federal court would reach, even in the absence of the regulation ... ." 66 Fed.Reg. 34790 (2001) (emphasis added). Taking the OCC at its word, then, § 7.4006 has no preemptive force of its own, but merely predicts how a federal court's analysis will proceed.

Even if the OCC did intend its regulation to preempt the state laws at issue here, it would still not merit Chevron deference. No case from this Court has ever applied such a deferential standard to an agency decision that could so easily disrupt the federal-state balance. To be sure, expert agency opinions as to which state laws conflict with a federal statute may be entitled to "some weight," especially when "the subject matter is technical" and "the relevant history and background are complex and extensive." Geier v. American Honda Motor Co., 529 U.S. 861, 883, 120 S.Ct. 1913, 146 L.Ed.2d 914 (2000). But "[u]nlike Congress, administrative agencies are clearly not designed to represent the interests of States, yet with relative ease they can promulgate comprehensive and detailed regulations that have broad preemption ramifications for state law." Id., at 908, 120 S.Ct. 1913 (STEVENS, J., dissenting).^[39] For that reason, when an agency purports to decide the scope of federal preemption, a healthy respect for state sovereignty calls for something less than Chevron deference. See 529 U.S., at 911-912, 120 S.Ct. 1913; see also Medtronic, 518 U.S., at 512, 116 S.Ct. 2240 (O'Connor, J., concurring in part and dissenting in part) ("It is not certain that an agency regulation determining the pre-emptive effect of any federal statute is entitled to deference").

In any event, neither of the two justifications the OCC advanced when it promulgated 12 CFR § 7.4006 withstand Chevron analysis. First, the OCC observed that the GLBA "expressly acknowledged the authority of national banks to own subsidiaries" that conduct national bank activities "`subject to the same terms and conditions that govern the conduct of such activities by national banks.'" 66 Fed.Reg. 34788 (quoting 12 U.S.C. § 24a(g)(3)). The agency also noted that it had folded the "`same terms and conditions'" language into an implementing regulation, 66 Fed. Reg. 34788 (citing 12 CFR § 5.34(e)(3) (2001)). According to the OCC, "[a] fundamental component of these descriptions of the characteristics of operating subsidiaries in GLBA and the OCC's rule is that state laws apply to operating subsidiaries to the same extent as they apply to the parent national bank." 66 Fed.Reg. 34788.

This is incorrect. As explained above, the GLBA's offhand use of the "same terms and conditions" language says nothing about preemption. See supra, at 1581-1582. Nor can the OCC's incorporation of that language into a regulation support the agency's position: "Simply put, the existence of a parroting regulation does not change the fact that the question here is not the meaning of the regulation but the meaning of the statute." Gonzales v. Oregon, 546 U.S. 243, 257, 126 S.Ct. 904, 163 L.Ed.2d 748 (2006). The OCC's argument to the contrary is particularly surprising given that when it promulgated its "same terms and conditions" regulation, it said not one word about preemption or the federalism implications of its rule—an inexplicable elision if a "fundamental component" of the phrase is the need to operate unfettered by state oversight. Compare 65 Fed.Reg. 12905-12910 (2000), with Exec. Order No. 13132, §§ 2, 4, 64 Fed. Reg. 43255, 43257 (1999) (requiring agencies [1585] to explicitly consider the "federalism implications" of their chosen policies and to hesitate before preempting state laws).

Second, the OCC describes operating subsidiaries "as the equivalent of departments or divisions of their parent banks," 66 Fed.Reg. 34788, which, through the operation of 12 U.S.C. § 484(a), would not be subject to state visitorial powers. The OCC claims that national banks might desire to conduct their business through operating subsidiaries for the purposes of "controlling operations costs, improving effectiveness of supervision, more accurate determination of profits, decentralizing management decisions [and] separating particular operations of the bank from other operations." Brief for United States as Amicus Curiae 19 (quoting 31 Fed.Reg. 11460). It is obvious, however, that a national bank could realize all of those benefits through the straightforward expedient of dissolving the corporation and making it in fact a "department" or a "division" of the parent bank.

Rather, the primary advantage of maintaining an operating subsidiary as a separate corporation is that it shields the national bank from the operating subsidiaries' liabilities. United States v. Bestfoods, 524 U.S. 51, 61, 118 S.Ct. 1876, 141 L.Ed.2d 43 (1998) ("It is a general principle of corporate law deeply ingrained in our economic and legal systems that a parent corporation ... is not liable for the acts of its subsidiary" (internal quotation marks omitted)). For that reason, the OCC's regulation is about far more than mere "corporate structure," ante, at 1570-1571, or "internal governance," ante, at 1573 (citing Wells Fargo Bank, N.A. v. Boutris, 419 F.3d 949, 960 (C.A.9 2005)); see also Dole Food Co. v. Patrickson, 538 U.S. 468, 474, 123 S.Ct. 1655, 155 L.Ed.2d 643 (2003) ("In issues of corporate law structure often matters"). It is about whether a state corporation can avoid complying with state regulations, yet nevertheless take advantage of state laws insulating its owners from liability. The federal interest in protecting depositors in national banks from their subsidiaries' liabilities surely does not justify a grant of immunity from laws that apply to competitors. Indeed, the OCC's regulation may drive companies seeking refuge from state regulation into the arms of federal parents, harm those state competitors who are not lucky enough to find a federal benefactor, and hamstring States' ability to regulate the affairs of state corporations. As a result, the OCC's regulation threatens both the dual banking system and the principle of competitive equality that is its cornerstone.

VI

The novelty of today's holding merits a final comment. Whatever the Court says, this is a case about an administrative agency's power to preempt state laws. I agree with the Court that the Tenth Amendment does not preclude the exercise of that power. But the fact that that Amendment was included in the Bill of Rights should nevertheless remind the Court that its ruling affects the allocation of powers among sovereigns. Indeed, the reasons for adopting that Amendment are precisely those that undergird the well-established presumption against preemption.

With rare exception, we have found preemption only when a federal statute commanded it, see Cipollone, 505 U.S., at 517, 112 S.Ct. 2608, when a conflict between federal and state law precluded obedience to both sovereigns, see Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142-143, 83 S.Ct. 1210, 10 L.Ed.2d 248 (1963), or when a federal statute so completely occupied a field that it left no room [1586] for additional state regulation, see Napier v. Atlantic Coast Line R. Co., 272 U.S. 605, 613, 47 S.Ct. 207, 71 L.Ed. 432 (1926). Almost invariably the finding of preemption has been based on this Court's interpretation of statutory language or of regulations plainly authorized by Congress. Never before have we endorsed administrative action whose sole purpose was to preempt state law rather than to implement a statutory command.

Accordingly, I respectfully dissent.

[1] National City Bank of Indiana v. Turnbaugh, 463 F.3d 325 (C.A.4 2006); Wachovia Bank, N.A. v. Burke, 414 F.3d 305 (C.A.2 2005); 431 F.3d 556 (C.A.6 2005) (case below); Wells Fargo Bank N.A. v. Boutris, 419 F.3d 949 (C.A.9 2005).

[2] Michigan's law exempts subsidiaries of national banks that maintain a main office or branch office in Michigan. Mich. Comp. Laws Ann. §§ 445.1652(1)(b) (West Supp. 2006), 445.1675(m) (West 2002), 493.53a(d) (West 1998). Wachovia Bank has no such office in Michigan.

[3] The Act of June 3, 1864, ch. 106, 13 Stat. 99, was originally entitled "An Act to provide a National Currency ..."; its title was altered by Congress in 1874 to "the National Bank Act." Ch. 343, 18 Stat. 123.

[4] Section 1828(o) requires federal banking agencies to adopt uniform regulations prescribing standards for real estate lending by depository institutions and sets forth criteria governing such standards. See, e.g., § 1828(o)(2)(A) ("In prescribing standards... the agencies shall consider—(i) the risk posed to the deposit insurance funds by such extensions of credit; (ii) the need for safe and sound operation of insured depository institutions; and (iii) the availability of credit.").

[5] See also 2 R. Taylor, Banking Law § 37.02, p. 37-5 (2006) ("[OCC] has exclusive authority to charter and examine [national] banks." (footnote omitted)).

[6] See 69 Fed.Reg. 1908 (2004) ("The application of multiple, often unpredictable, different state or local restrictions and requirements prevents [national banks] from operating in the manner authorized under Federal law, is costly and burdensome, interferes with their ability to plan their business and manage their risks, and subjects them to uncertain liabilities and potential exposure.").

[7] Ours is indeed a "dual banking system." See post, at 1573-1576, 1585. But it is a system that has never permitted States to license, inspect, and supervise national banks as they do state banks. The dissent repeatedly refers to the policy of "competitive equality" featured in First Nat. Bank in Plant City v. Dickinson, 396 U.S. 122, 131, 90 S.Ct. 337, 24 L.Ed.2d 312 (1969). See post, at 1575, 1580, 1583, 1585. Those words, however, should not be ripped from their context. Plant City involved the McFadden Act (Branch Banks), 44 Stat. 1228, 12 U.S.C. § 36, in which Congress expressly authorized national banks to establish branches "only when, where, and how state law would authorize a state bank to establish and operate such [branches]." 396 U.S., at 130, 90 S.Ct. 337. See also id., at 131, 90 S.Ct. 337 ("[W]hile Congress has absolute authority over national banks, the [McFadden Act] has incorporated by reference the limitations which state law places on branch banking activities by state banks. Congress has deliberately settled upon a policy intended to foster competitive equality.... [The] Act reflects the congressional concern that neither system ha[s] advantages over the other in the use of branch banking." (quoting First Nat. Bank of Logan v. Walker Bank & Trust Co., 385 U.S. 252, 261, 87 S.Ct. 492, 17 L.Ed.2d 343 (1966))). "[W]here Congress has not expressly conditioned the grant of `power' upon a grant of state permission, the Court has ordinarily found that no such condition applies." Barnett Bank of Marion Cty., N.A. v. Nelson, 517 U.S. 25, 34, 116 S.Ct. 1103, 134 L.Ed.2d 237 (1996). The NBA provisions before us, unlike the McFadden Act, do not condition the exercise of power by national banks on state allowance of similar exercises by state banks. See supra, at 1567-1568.

[8] The regulation further provides:

"If, upon examination, the OCC determines that the operating subsidiary is operating in violation of law, regulation, or written condition, or in an unsafe or unsound manner or otherwise threatens the safety or soundness of the bank, the OCC will direct the bank or operating subsidiary to take appropriate remedial action, which may include requiring the bank to divest or liquidate the operating subsidiary, or discontinue specified activities." 12 CFR § 5.34(e)(3) (2006).

[9] OCC subsequently revised its regulations to track the statute. See § 5.34(e)(1), (3); Financial Subsidiaries and Operating Subsidiaries, 65 Fed.Reg. 12905, 12911 (2000). Cf. post, at 1578 (dissent's grudging acknowledgment that Congress "may have acquiesced" in OCC's position that national banks may engage in "the business of banking" through operating subsidiaries empowered to do only what the bank itself can do).

[10] For example, "for purposes of applying statutory or regulatory limits, such as lending limits or dividend restrictions," e.g., 12 U.S.C. §§ 56, 60, 84, 371d, "[t]he results of operations of operating subsidiaries are consolidated with those of its parent." Comptroller's Handbook 64. Likewise, for accounting and regulatory reporting purposes, an operating subsidiary is treated as part of the member bank; assets and liabilities of the two entities are combined. See 12 CFR §§ 5.34(e)(4)(i), 223.3(w) (2006). OCC treats financial subsidiaries differently. A national bank may not consolidate the assets and liabilities of a financial subsidiary with those of the bank. Comptroller's Handbook 64. It cannot be fairly maintained "that the transfer in 2003 of [Wachovia Mortgage's] ownership from the holding company to the Bank" resulted in no relevant changes to the company's business. Compare post, at 1580, with supra, at 1569-1570, n. 8. On becoming Wachovia's operating subsidiary, Wachovia Mortgage became subject to the same terms and conditions as national banks, including the full supervisory authority of OCC. This change exposed the company to significantly more federal oversight than it experienced as a state nondepository institution.

[11] Cf. Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp., 439 U.S. 299, 308, and n. 24, 99 S.Ct. 540, 58 L.Ed.2d 534 (1978) (holding that national bank may charge home State's interest rate, regardless of more restrictive usury laws in borrower's State, but declining to consider operating subsidiaries).

[12] The dissent protests that the GLBA does not itself preempt the Michigan provisions at issue. Cf. post, at 1581-1582. We express no opinion on that matter. Our point is more modest: The GLBA simply demonstrates Congress' formal recognition that national banks have incidental power to do business through operating subsidiaries. See supra, at 1569-1570; cf. post, at 1577-1578.

[13] Because we hold that the NBA itself—independent of OCC's regulation—preempts the application of the pertinent Michigan laws to national bank operating subsidiaries, we need not consider the dissent's lengthy discourse on the dangers of vesting preemptive authority in administrative agencies. See post, at 1582-1585; cf. post, at 1585-1586 (maintaining that "[w]hatever the Court says, this is a case about an administrative agency's power to preempt state laws," and accusing the Court of "endors[ing] administrative action whose sole purpose was to preempt state law rather than to implement a statutory command").

[14] Watters does not assert that Wachovia Mortgage is out of compliance with any North Carolina law governing its corporate status.

[15] "There is no more characteristic difference between the state and the national banking laws than the fact that almost without exception, state banks may loan on real estate security, while national banks are prohibited from doing so." G. Barnett, State Banking in the United States Since the Passage of the National Bank Act 50 (1902) (reprint 1983) (hereinafter Barnett).

[16] B. Hammond, Banks and Politics in America: from the Revolution to the Civil War 728 (1957).

[17] Id., at 733. See also Barnett 73-74 (estimating that more than 800 state banks were in operation in 1877, and noting the "remarkable increase in the number of state banks" during the last two decades of the 19th century).

[18] See also McClellan v. Chipman, 164 U.S. 347, 357, 17 S.Ct. 85, 41 L.Ed. 461 (1896) (explaining that our cases establish "a rule and an exception, the rule being the operation of general state laws upon the dealings and contracts of national banks, the exception being the cessation of the operation of such laws whenever they expressly conflict with the laws of the United States or frustrate the purpose for which the national banks were created, or impair their efficiency to discharge the duties imposed upon them by the law of the United States").

[19] See also Anderson Nat. Bank v. Luckett, 321 U.S. 233, 248, 64 S.Ct. 599, 88 L.Ed. 692 (1944) ("This Court has often pointed out that national banks are subject to state laws, unless those laws infringe the national banking laws or impose an undue burden on the performance of the banks' functions"); Davis v. Elmira Savings Bank, 161 U.S. 275, 290, 16 S.Ct. 502, 40 L.Ed. 700 (1896) ("Nothing, of course, in this opinion is intended to deny the operation of general and undiscriminating state laws on the contracts of national banks, so long as such laws do not conflict with the letter or the general objects and purposes of Congressional legislation")

[20] See Scott, The Dual Banking System: A Model of Competition in Regulation, 30 Stan. L.Rev. 1, 8-13 (1978) (explaining the perceived benefits of the dual banking system).

[21] See also First Nat. Bank of Logan v. Walker Bank & Trust Co., 385 U.S. 252, 261, 87 S.Ct. 492, 17 L.Ed.2d 343 (1966) (observing that in passing the McFadden Act, "Congress was continuing its policy of equalization first adopted in the National Bank Act of 1864").

[22] What has emerged are "two interrelated systems in which most state-chartered banks are subject to varying degrees of federal regulation, and where state laws are made applicable, to a varying extent, to federally-chartered institutions." 1 A. Graham, Banking Law § 1.04, p. 1-12 (Nov.2006).

[23] It is noteworthy that the principal cases that the Court cites to support its conclusion that the federal statute itself preempts the Michigan laws were decided years before Congress authorized national banks to engage in mortgage lending and years before the Office of the Comptroller of the Currency (OCC) authorized their use of operating subsidiaries. See ante, at 1566-1567, 1568-1569.

[24] In Investment Company Institute v. Camp, 401 U.S. 617, 91 S.Ct. 1091, 28 L.Ed.2d 367 (1971), we set aside a regulation issued by the Comptroller of the Currency authorizing banks to operate collective investment funds because that activity was prohibited by the Glass-Steagall Act. Similarly, in Securities Industry Assn. v. Board of Governors, FRS, 468 U.S. 137, 104 S.Ct. 2979, 82 L.Ed.2d 107 (1984), the Glass-Steagall Act provided the basis for invalidating a regulation authorizing banks to enter the business of selling third-party commercial paper.

[25] See J. Macey, G. Miller, & R. Carnell, Banking Law and Regulation 21 (3d ed.2001) (describing "the alleged misdeeds of the large banks' securities affiliates and the ways in which such affiliations could promote unsound lending, irresponsible speculation, and conflicts of interest").

[26] See 31 Fed.Reg. 11459 (1966).

[27] See Bank Holding Company Act of 1956, 70 Stat. 133; Bank Holding Company Act Amendments of 1970, 84 Stat. 1760.

[28] While the statutory text provides ample support for this conclusion, it is noteworthy that it was so understood by contemporary commentators. See, e.g., 145 Cong. Rec. 29681 (1999) ("Recently, the Comptroller of the Currency has interpreted section 24 (Seventh) of the National Bank Act to permit national banks to own and control subsidiaries engaged in activities that national banks cannot conduct directly. These decisions and the legal reasoning therein are erroneous and contrary to the law. The [GLBA] overturns these decisions ... ." (statement of Representative Bliley)).

[29] See 12 U.S.C. § 221a(b) (defining affiliates to include "any corporation" that a federal member bank owns or controls).

[30] See National City Bank of Indiana v. Turnbaugh, 463 F.3d 325, 331-333 (C.A.4 2006) (holding that State law conflicted with OCC regulations, not with the NBA); Wachovia Bank, N.A. v. Burke, 414 F.3d 305, 315-316 (C.A.2 2005) (same); 431 F.3d 556, 560-563 (C.A.6 2005) (case below) (same); Wells Fargo Bank, N.A. v. Boutris, 419 F.3d 949, 962-967 (C.A.9 2005) (same).

[31] While the Court at one point observes that "the Michigan provisions at issue exempt national banks from coverage," see ante, 1568, that is because they are "banks," not because they are "national." See ante, at 1564-1565 (noting that "Michigan's statutory regime exempts banks, both national and state, from state mortgage lending regulation" (emphasis added)).

[32] The Michigan laws focus on consumer protection, whereas the OCC regulations quoted by the Court focus on protection of bank depositors. See ante, at 1567, n. 4, and 1569-1570, n. 8.

[33] See also General Motors Corp. v. Abrams, 897 F.2d 34, 41-43 (C.A.2 1990) ("Because consumer protection law is a field traditionally regulated by the states, compelling evidence of an intention to preempt is required in this area").

[34] See 31 Fed.Reg. 11460 (noting that OCC maintains regulatory oversight of operating subsidiaries).

[35] See, e.g., 47 U.S.C. §§ 253(a), (d) (authorizing the Federal Communications Commission to preempt "any [state] statute, regulation, or legal requirement" that "may prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate telecommunications service"); 30 U.S.C. § 1254(g) (preempting any statute that conflicts with "the purposes and the requirements of this chapter" and permitting the Secretary of the Interior to "set forth any State law or regulation which is preempted and superseded"); 49 U.S.C. § 5125(d) (authorizing the Secretary of Transportation to decide whether a state or local statute that conflicts with the regulation of hazardous waste transportation is preempted).

[36] Congress did make an indirect reference to regulatory preemption in the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, § 114, 108 Stat. 2367 (codified at 12 U.S.C. § 43(a)). The Riegle-Neal Act requires the OCC to jump through additional procedural hoops (specifically, notice and comment, even for opinion letters and interpretive rules) before "conclud[ing] that Federal law preempts the application to a national bank of any State law regarding community reinvestment, consumer protection, fair lending, or the establishment of intrastate branches." Ibid. By its own terms, however, this provision granted no preemption authority to the OCC.

[37] In a recent adoption of a separate preemption regulation, the OCC located the source of its authority to displace state laws in 12 U.S.C. §§ 93a and 371. See 69 Fed.Reg. 1908 (2004). Both provisions are generic authorizations of rulemaking authority, however, and neither says a word about preemption. See 12 U.S.C. § 93a ("[T]he Comptroller of the Currency is authorized to prescribe rules and regulations to carry out the responsibilities of the office"); § 371(a) (authorizing national banks to make real estate loans "subject to ... such restrictions and requirements as the Comptroller of the Currency may prescribe by regulation or order"). Needless to say, they provide no textual foundation for the OCC's assertion of preemption authority.

[38] This conclusion does not touch our cases holding that a properly promulgated agency regulation can have a preemptive effect should it conflict with state law. See Hillsborough County v. Automated Medical Laboratories, Inc., 471 U.S. 707, 713, 105 S.Ct. 2371, 85 L.Ed.2d 714 (1985) ("We have held repeatedly that state laws can be pre-empted by federal regulations as well as by federal statutes"); see also Fidelity Fed. Sav. & Loan Assn. v. de la Cuesta, 458 U.S. 141, 154-159, 102 S.Ct. 3014, 73 L.Ed.2d 664 (1982) (holding that a regulation authorizing federal savings-and-loan associations to include due-on-sale clauses in mortgage contracts conflicted with a state-court doctrine that such clauses were unenforceable); City of New York v. FCC, 486 U.S. 57, 59, 65-70, 108 S.Ct. 1637, 100 L.Ed.2d 48 (1988) (finding that the FCC's adoption of "regulations that establish technical standards to govern the quality of cable television signals" preempted local signal quality standards). My analysis is rather confined to agency regulations (like the one at issue here) that "purpor[t] to settle the scope of federal preemption" and "reflec[t] an agency's effort to transform the preemption question from a judicial inquiry into an administrative fait accompli." See Note, The Unwarranted Regulatory Preemption of Predatory Lending Laws, 79 N.Y.U.L.Rev. 2274, 2289 (2004).

[39] See also Mendelson, Chevron and Preemption, 102 Mich. L.Rev. 737, 779-790 (2003-2004) (arguing that agencies are generally insensitive to federalism concerns).

513 U.S. 251 (1995)

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

[253] [253] Ginsburg, J., delivered the opinion for a unanimous Court.

Edward C. DuMont argued the cause for petitioners in No. 93-1613. With him on the briefs were Solicitor General Days, Assistant Attorney General Hunger, Deputy Solicitor General Bender, Mark B. Stern, Jacob M. Lewis, Julie L. Williams, L. Robert Griffin, and Yvonne D. McIntire. Steven S. Rosenthal argued the cause for petitioners in No. 93-1612. With him on the briefs were Robert M. Kurucza and Robert G. Ballen.

David Overlock Stewart argued the cause for respondent in both cases. With him on the brief were Alan G. Priest, Raymond C. Ortman, Jr., and William A. Wilson.^[2] Briefs of amici curiae urging affirmance were filed for Tom Gallagher, Treasurer and Insurance Commissioner of Florida, et al. by David J. Busch, Richard Blumenthal, Attorney General of Connecticut, pro se, and Mark F. Kohler, Assistant Attorney General, J. Joseph Curran, Jr., Attorney General of Maryland, Gary L. Spaeth, Heidi Heitkamp, Attorney General of North Dakota, Jeffrey B. Pine, Attorney General of Rhode Island, and Maureen G. Glynn, Special Assistant Attorney General; for the American Academy of Actuaries by Lauren M. Bloom; for the American Council of Life Insurance by Gary E. Hughes, Allen R. Caskie, and Phillip E. Stano; for the American Land Title Association by Sheldon E. Hochberg; for the National Association of Insurance Commissioners by Susan E. Martin and Ellen Dollase Wilcox; and for the National Association of Life Underwriters et al. by Ann M. Kappler and Scott A. Sinder.

[254] Justice Ginsburg delivered the opinion of the Court.

These consolidated cases present the question whether national banks may serve as agents in the sale of annuities. The Comptroller of the Currency, charged by Congress with superintendence of national banks, determined that federal law permits such annuity sales as a service to bank customers. Specifically, the Comptroller considered the sales at issue "incidental" to "the business of banking" under the National Bank Act, Rev. Stat. § 5136, as amended, 12 U. S. C. § 24 Seventh (1988 ed. and Supp. V). The Comptroller further concluded that annuities are not "insurance" within the meaning of § 92; that provision, by expressly authorizing banks in towns of no more than 5,000 people to sell insurance, arguably implies that banks in larger towns may not sell insurance. The United States District Court for the Southern District of Texas upheld the Comptroller's conclusions as a permissible reading of the National Bank Act, but the United States Court of Appeals for the Fifth Circuit reversed. We are satisfied that the Comptroller's construction of the Act is reasonable and therefore warrants judicial deference. Accordingly, we reverse the judgment of the Court of Appeals.

I

Petitioner NationsBank of North Carolina, N. A., a national bank based in Charlotte, and its brokerage subsidiary sought permission from the Comptroller of the Currency, pursuant to 12 CFR § 5.34 (1994), for the brokerage subsidiary to act as an agent in the sale of annuities. Annuities are contracts under which the purchaser makes one or more premium payments to the issuer in exchange for a series of payments, which continue either for a fixed period or for the life of the purchaser or a designated beneficiary. When a purchaser invests in a "variable" annuity, the purchaser's money is invested in a designated way and payments to the purchaser vary with investment performance. In a classic "fixed" annuity, in contrast, payments do not vary. Under [255] the contracts NationsBank proposed to sell, purchasers could direct their payments to a variable, fixed, or hybrid account, and would be allowed periodically to modify their choice. The issuers would be various insurance companies. See Letter from J. Michael Shepherd, Senior Deputy Comptroller, to Robert M. Kurucza (Mar. 21, 1990), App. to Pet. for Cert. in No. 93-1612, pp. 35a—36a (Comptroller's Letter).

The Comptroller granted NationsBank's application. He concluded that national banks have authority to broker annuities within "the business of banking" under 12 U. S. C. § 24 Seventh. He further concluded that § 92, addressing insurance sales by banks in towns with no more than 5,000 people, did not impede his approval; for purposes of that provision, the Comptroller explained, annuities do not rank as "insurance." See Comptroller's Letter 41a—47a.

Respondent Variable Annuity Life Insurance Co. (VALIC), which sells annuities, challenged the Comptroller's decision. VALIC filed suit in the United States District Court for the Southern District of Texas seeking declaratory and injunctive relief pursuant to the Administrative Procedure Act, 5 U. S. C. § 706(2)(A), and 28 U. S. C. §§ 2201, 2202 (1988 ed. and Supp. V). The District Court granted summary judgment in favor of the Comptroller and NationsBank. Variable Annuity Life Ins. Co. v. Clarke, 786 F. Supp. 639 (1991). The United States Court of Appeals for the Fifth Circuit reversed. Variable Annuity Life Ins. Co. v. Clarke, 998 F. 2d 1295 (1993). Relying on its decision in Saxon v. Georgia Assn. of Independent Ins. Agents, Inc., 399 F. 2d 1010 (1968), the Fifth Circuit first held that § 92 bars banks not located in small towns from selling insurance, and then rejected the Comptroller's view that annuities are not insurance for purposes of § 92. See 998 F. 2d, at 1298-1302.

Four judges dissented from the failure of the court to grant rehearing en banc. The dissenters maintained that the panel had not accorded due deference to the Comptroller's reasonable statutory interpretations. Variable Annu- [256] ity Life Ins. Co. v. Clark[e], 13 F. 3d 833, 837-838 (CA5 1994).^[3] We granted certiorari. 511 U. S. 1141 (1994).

II

A

Authorizing national banks to "carry on the business of banking," the National Bank Act provides that such banks shall have power—

"To exercise . . . all such incidental powers as shall be necessary to carry on the business of banking; by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion; by loaning money on personal security; and by obtaining, issuing, and circulating notes . . . . The business of dealing in securities and stock by the [bank] shall be limited to purchasing and selling such securities and stock without recourse, solely upon the order, and for the account of, customers, and in no case for its own account, and the [bank] shall not underwrite any issue of securities or stock . . . ." 12 U. S. C. § 24 Seventh (1988 ed. and Supp. V).

As the administrator charged with supervision of the National Bank Act, see §§ 1, 26-27, 481, the Comptroller bears primary responsibility for surveillance of "the business of banking" authorized by § 24 Seventh. We have reiterated:

"`It is settled that courts should give great weight to any reasonable construction of a regulatory statute adopted by the agency charged with the enforcement of that statute. The Comptroller of the Currency is charged with the enforcement of banking laws to an extent that warrants the invocation of this principle with [257] respect to his deliberative conclusions as to the meaning of these laws.' " Clarke v. Securities Industry Assn., 479 U. S. 388, 403-404 (1987) (quoting Investment Com- pany Institute v. Camp, 401 U. S. 617, 626-627 (1971)).

Under the formulation now familiar, when we confront an expert administrator's statutory exposition, we inquire first whether "the intent of Congress is clear" as to "the precise question at issue." Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, 842 (1984). If so, "that is the end of the matter." Ibid. But "if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute." Id., at 843. If the administrator's reading fills a gap or defines a term in a way that is reasonable in light of the legislature's revealed design, we give the administrator's judgment "controlling weight." Id., at 844.

In authorizing NationsBank to broker annuities, the Comptroller invokes the power of banks to "broker a wide variety of financial investment instruments," Comptroller's Letter 38a, which the Comptroller considers "part of [banks'] traditional role as financial intermediaries," ibid., and therefore an "incidental powe[r] . . . necessary to carry on the business of banking." 12 U. S. C. § 24 Seventh; see also Interpretive Letter No. 494 (Dec. 20, 1989) (discussing features of financial investment instruments brokerage that bring this activity within the "business of banking") (cited in Comptroller's Letter 38a). The Comptroller construes the § 24 Seventh authorization of "incidental powers . . . necessary to carry on the business of banking" as an independent grant of authority; he reads the specific powers set forth thereafter as exemplary, not exclusive.

VALIC argues that the Comptroller's interpretation is contrary to the clear intent of Congress because the banking power on which the Comptroller relies—"broker[ing] financial investment instruments"—is not specified in § 24 Seventh. [258] Brief for Respondent 35-45. According to VALIC, the five specific activities listed in § 24 Seventh after the words "business of banking" are exclusive—banks are confined to these five activities and to endeavors incidental thereto. Id., at 35-36. VALIC thus attributes no independent significance to the words "business of banking." We think the Comptroller better comprehends the Act's terms.

The second sentence of § 24 Seventh, in limiting banks' "dealing in securities," presupposes that banks have authority not circumscribed by the five specifically listed activities. Congress' insertion of the limitation decades after the Act's initial adoption makes sense only if banks already had authority to deal in securities, authority presumably encompassed within the "business of banking" language which dates from 1863. VALIC argues, however, that the limitation was imposed by the Glass-Steagall Act of 1933, and that the power Glass-Steagall presupposed was specifically granted in the McFadden Act of 1927. Brief for Respondent 46. While the statute's current wording derives from the Glass-Steagall Act, see Act of June 16, 1933, ch. 89, § 16, 48 Stat. 184, the earlier McFadden Act does not bolster VALIC's case, for that Act, too, limited an activity already part of the business national banks did. See Act of Feb. 25, 1927, § 2(b), 44 Stat. 1226 ("Provided, That the business of buying and selling investment securities shall hereinafter be limited to buying and selling without recourse . . . ."); see also Clarke v. Securities Industry Assn., 479 U. S., at 407— 408 (even before the McFadden Act, banks conducted securities transactions on a widespread basis); 2 F. Redlich, The Molding of American Banking: Men and Ideas, pt. 2, pp. 389— 393 (1951) (describing securities activities of prominent early national banks).^[4]

[259] B

As we have just explained, the Comptroller determined, in accord with the legislature's intent, that "the business of banking" described in § 24 Seventh covers brokerage of financial investment instruments, and is not confined to the examples specifically enumerated. He then reasonably concluded that the authority to sell annuities qualifies as part of, or incidental to, the business of banking. National banks, the Comptroller observed, are authorized to serve as agents for their customers in the purchase and sale of various financial investment instruments, Comptroller's Letter 38a,^[5] and annuities are widely recognized as just such investment products. See D. Shapiro & T. Streiff, Annuities 7 (1992) & "[a]nnuities (in contrast to life insurance, . . . are primarily investment products"); 1 J. Appleman & J. Appleman, Insurance Law and Practice § 84, p. 295 (1981) ("Annuity contracts must . . . be recognized as investments rather than as insurance.").

By making an initial payment in exchange for a future income stream, the customer is deferring consumption, setting aside money for retirement, future expenses, or a rainy day. For her, an annuity is like putting money in a bank account, a debt instrument, or a mutual fund. Offering bank accounts and acting as agent in the sale of debt instruments and mutual funds are familiar parts of the business of banking. See, e. g., Securities Industry Assn. v. Board of Governors, FRS, 468 U. S. 207, 215 (1984) ("Banks long have arranged the purchase and sale of securities as an accommodation to their customers."); First Nat. Bank of Hartford v. Hartford, 273 U. S. 548, 559-560 (1927) (banks have authority [260] to sell mortgages and other debt instruments they have originated or acquired by discount).

In sum, modern annuities, though more sophisticated than the standard savings bank deposits of old, answer essentially the same need. By providing customers with the opportunity to invest in one or more annuity options, banks are essentially offering financial investment instruments of the kind congressional authorization permits them to broker. Hence, the Comptroller reasonably typed the permission NationsBank sought as an "incidental powe[r] . . . necessary to carry on the business of banking."^[6]

III

A

In the alternative, VALIC argues that 12 U. S. C. § 92 (1988 ed., Supp. V) bars NationsBank from selling annuities as agent. That section provides:

"In addition to the powers now vested by law in [national banks] any such [bank] located and doing business in any place the population of which does not exceed five thousand inhabitants . . . may . . . act as the agent for any fire, life, or other insurance company authorized by the authorities of the State in which said bank is located to do business in said State, by soliciting and selling insurance and collecting premiums on policies issued by such company . . . ."

The parties disagree about whether § 92, by negative implication, precludes national banks located in places more populous than 5,000 from selling insurance. We do not reach [261] this question because we accept the Comptroller's view that, for the purpose at hand, annuities are properly classified as investments, not "insurance."

Again, VALIC contends that the Comptroller's determination is contrary to the plain intent of Congress, or else is unreasonable. In support of its position that annuities are insurance, VALIC notes first that annuities traditionally have been sold by insurance companies. But the sale of a product by an insurance company does not inevitably render the product insurance. For example, insurance companies have long offered loans on the security of life insurance, see 3 Appleman & Appleman, Insurance Law and Practice § 1731, p. 562 (1967), but a loan does not thereby become insurance.

VALIC further asserts that most States have regulated annuities as insurance and that Congress intended to define insurance under § 92 by reference to state law. Treatment of annuities under state law, however, is contextual. States generally classify annuities as insurance when defining the powers of insurance companies and state insurance regulators. See, e. g., 998 F. 2d, at 1300, n. 2 (citing statutes). But in diverse settings, States have resisted lump classification of annuities as insurance. See, e. g., In re New York State Assn. of Life Underwriters, Inc. v. New York State Banking Dept., 83 N. Y. 2d 353, 363, 632 N. E. 2d 876, 881 (1994) (rejecting "assertion that annuities are insurance which [statechartered] banks are not authorized to sell," even though state insurance law "includes `annuities' in its description of `kinds of insurance authorized' "); In re Estate of Rhodes, 197 Misc. 232, 237, 94 N. Y. S. 2d 406, 411 (Surr. Ct. 1949) (annuity contracts do not qualify for New York estate tax exemption applicable to insurance); Commonwealth v. Metropolitan Life Ins. Co., 254 Pa. 510, 513-516, 98 A. 1072, 1073 (1916) (annuities are not insurance for purposes of tax that insurance companies pay on insurance premiums received within [262] the State); State ex rel. Equitable Life Assurance Soc. of United States v. Ham, 54 Wyo. 148, 159, 88 P. 2d 484, 488 (1939) (same).

As our decisions underscore, a characterization fitting in certain contexts may be unsuitable in others. See, e. g., Atlantic Cleaners & Dyers, Inc. v. United States, 286 U. S. 427, 433 (1932) ("meaning [of words] well may vary to meet the purposes of the law"; courts properly give words "the meaning which the legislature intended [they] should have in each instance"); cf. Cook, "Substance" and "Procedure" in the Conflict of Laws, 42 Yale L. J. 333, 337 (1933) ("The tendency to assume that a word which appears in two or more legal rules, and so in connection with more than one purpose, has and should have precisely the same scope in all of them, runs all through legal discussions. It has all the tenacity of original sin and must constantly be guarded against."). Moreover, the federal banking law does not plainly require automatic reference to state law here. The Comptroller has concluded that the federal regime is best served by classifying annuities according to their functional characteristics. Congress has not ruled out that course, see Chevron, 467 U. S., at 842; courts, therefore, have no cause to dictate to the Comptroller the state-law constraint VALIC espouses.

VALIC further argues that annuities functionally resemble life insurance because some annuities place mortality risk on the parties. Under a classic fixed annuity, the purchaser pays a sum certain and, in exchange, the issuer makes periodic payments throughout, but not beyond, the life of the purchaser. In pricing such annuities, issuers rely on actuarial assumptions about how long purchasers will live.

While cognizant of this similarity between annuities and insurance, the Comptroller points out that mortality risk is a less salient characteristic of contemporary products. Many annuities currently available, both fixed and variable, do not feature a life term. Instead they provide for payments over a term of years; if the purchaser dies before the term ends, [263] the balance is paid to the purchaser's estate. Moreover, the presence of mortality risk does not necessarily qualify an investment as "insurance" under § 92. For example, VALIC recognizes that a life interest in real property is not insurance, although it imposes a mortality risk on the purchaser. Tr. of Oral Arg. 42. Some conventional debt instruments similarly impose mortality risk. See Note, Reverse Annuity Mortgages and the Due-on-Sale Clause, 32 Stan. L. Rev. 143, 145-151 (1979).

B

VALIC also charges the Comptroller with inconsistency. As evidence, VALIC refers to a 1978 letter from a member of the Comptroller's staff describing annuity investments as insurance arrangements. Brief for Respondent 16-17; see Letter from Charles F. Byrd, Assistant Director, Legal Advisory Services Division, Office of the Comptroller of the Currency (June 16, 1978), App. to Brief in Opposition 1a—2a (Byrd Letter). We note, initially, that the proposal disfavored in the 1978 letter did not clearly involve a bank selling annuities as an agent, rather than as a principal. See Byrd Letter 1a ("[T]he bank would purchase a group annuity policy from an insurer and then sell annuity contracts as investments in trust accounts."). Furthermore, unlike the Comptroller's letter to NationsBank here, the 1978 letter does not purport to represent the Comptroller's position. Compare Byrd Letter 1a ("It is my opinion . . . ") with Comptroller's Letter 35a ("The OCC's legal position on this issue was announced in a [prior 1990 letter]. Since I find neither policy nor supervisory reasons to object to this proposal, the Subsidiary may proceed."). Finally, any change in the Comptroller's position might reduce, but would not eliminate, the deference we owe his reasoned determinations. See Good Samaritan Hospital v. Shalala, 508 U. S. 402, 417 (1993) (quoting NLRB v. Iron Workers, 434 U. S. 335, 351 (1978)).

The Comptroller's classification of annuities, based on the tax deferral and investment features that distinguish them [264] from insurance, in short, is at least reasonable. See Comptroller's Letter 44a. A key feature of insurance is that it indemnifies loss. See Black's Law Dictionary 802 (6th ed. 1990) (first definition of insurance is "contract whereby, for a stipulated consideration, one party undertakes to compensate the other for loss on a specified subject by specified perils"). As the Comptroller observes, annuities serve an important investment purpose and are functionally similar to other investments that banks typically sell. See supra, at 259-260. And though fixed annuities more closely resemble insurance than do variable annuities, fixed annuities too have significant investment features and are functionally similar to debt instruments. Moreover, mindful that fixed annuities are often packaged with variable annuities, the Comptroller reasonably chose to classify the two together.

* * *

We respect as reasonable the Comptroller's conclusion that brokerage of annuities is an "incidental powe[r] . . . necessary to carry on the business of banking." We further defer to the Comptroller's reasonable determination that 12 U. S. C. § 92 is not implicated because annuities are not insurance within the meaning of that section. Accordingly, the judgment of the Court of Appeals for the Fifth Circuit is

Reversed.

[1] Together with No. 93-1613, Ludwig, Comptroller of the Currency, et al. v. Variable Annuity Life Insurance Co. et al., also on certiorari to the same court.

[2] Briefs of amici curiae urging reversal were filed for the American Bankers Association et al. by John J. Gill III, Michael F. Crotty, James T. McIntyre, Richard M. Whiting, and David L. Glass; for the Conference of State Bank Supervisors et al. by David W. Roderer, Eric L. Hirschhorn, Donn C. Meindertsma, J. Thomas Cardwell, Leonard J. Rubin, and M. Brooks Senn; and for the New York Clearing House Association by John L. Warden, Michael M. Wiseman, Theodore Edelman, and Norman R. Nelson.

[3] The dissenters also observed that 6 of the court's 13 active judges were disqualified from participating in the case. 13 F. 3d, at 834.

[4] We expressly hold that the "business of banking" is not limited to the enumerated powers in § 24 Seventh and that the Comptroller therefore has discretion to authorize activities beyond those specifically enumerated. The exercise of the Comptroller's discretion, however, must be kept within reasonable bounds. Ventures distant from dealing in financial investment instruments—for example, operating a general travel agency—may exceed those bounds.

[5] The Comptroller referred to Interpretive Letter No. 494 (Dec. 20, 1989) (approving brokerage of agricultural, oil, and metals futures).

[6] Assuring that the brokerage in question would not deviate from traditional bank practices, the Comptroller specified that NationsBank "will act only as agent, . . . will not have a principal stake in annuity contracts and therefore will incur no interest rate or actuarial risks." Comptroller's Letter 48a.

513 U.S. 251 (1995)

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

[253] [253] Ginsburg, J., delivered the opinion for a unanimous Court.

Edward C. DuMont argued the cause for petitioners in No. 93-1613. With him on the briefs were Solicitor General Days, Assistant Attorney General Hunger, Deputy Solicitor General Bender, Mark B. Stern, Jacob M. Lewis, Julie L. Williams, L. Robert Griffin, and Yvonne D. McIntire. Steven S. Rosenthal argued the cause for petitioners in No. 93-1612. With him on the briefs were Robert M. Kurucza and Robert G. Ballen.

David Overlock Stewart argued the cause for respondent in both cases. With him on the brief were Alan G. Priest, Raymond C. Ortman, Jr., and William A. Wilson.^[2] Briefs of amici curiae urging affirmance were filed for Tom Gallagher, Treasurer and Insurance Commissioner of Florida, et al. by David J. Busch, Richard Blumenthal, Attorney General of Connecticut, pro se, and Mark F. Kohler, Assistant Attorney General, J. Joseph Curran, Jr., Attorney General of Maryland, Gary L. Spaeth, Heidi Heitkamp, Attorney General of North Dakota, Jeffrey B. Pine, Attorney General of Rhode Island, and Maureen G. Glynn, Special Assistant Attorney General; for the American Academy of Actuaries by Lauren M. Bloom; for the American Council of Life Insurance by Gary E. Hughes, Allen R. Caskie, and Phillip E. Stano; for the American Land Title Association by Sheldon E. Hochberg; for the National Association of Insurance Commissioners by Susan E. Martin and Ellen Dollase Wilcox; and for the National Association of Life Underwriters et al. by Ann M. Kappler and Scott A. Sinder.

[254] Justice Ginsburg delivered the opinion of the Court.

These consolidated cases present the question whether national banks may serve as agents in the sale of annuities. The Comptroller of the Currency, charged by Congress with superintendence of national banks, determined that federal law permits such annuity sales as a service to bank customers. Specifically, the Comptroller considered the sales at issue "incidental" to "the business of banking" under the National Bank Act, Rev. Stat. § 5136, as amended, 12 U. S. C. § 24 Seventh (1988 ed. and Supp. V). The Comptroller further concluded that annuities are not "insurance" within the meaning of § 92; that provision, by expressly authorizing banks in towns of no more than 5,000 people to sell insurance, arguably implies that banks in larger towns may not sell insurance. The United States District Court for the Southern District of Texas upheld the Comptroller's conclusions as a permissible reading of the National Bank Act, but the United States Court of Appeals for the Fifth Circuit reversed. We are satisfied that the Comptroller's construction of the Act is reasonable and therefore warrants judicial deference. Accordingly, we reverse the judgment of the Court of Appeals.

I

Petitioner NationsBank of North Carolina, N. A., a national bank based in Charlotte, and its brokerage subsidiary sought permission from the Comptroller of the Currency, pursuant to 12 CFR § 5.34 (1994), for the brokerage subsidiary to act as an agent in the sale of annuities. Annuities are contracts under which the purchaser makes one or more premium payments to the issuer in exchange for a series of payments, which continue either for a fixed period or for the life of the purchaser or a designated beneficiary. When a purchaser invests in a "variable" annuity, the purchaser's money is invested in a designated way and payments to the purchaser vary with investment performance. In a classic "fixed" annuity, in contrast, payments do not vary. Under [255] the contracts NationsBank proposed to sell, purchasers could direct their payments to a variable, fixed, or hybrid account, and would be allowed periodically to modify their choice. The issuers would be various insurance companies. See Letter from J. Michael Shepherd, Senior Deputy Comptroller, to Robert M. Kurucza (Mar. 21, 1990), App. to Pet. for Cert. in No. 93-1612, pp. 35a—36a (Comptroller's Letter).

The Comptroller granted NationsBank's application. He concluded that national banks have authority to broker annuities within "the business of banking" under 12 U. S. C. § 24 Seventh. He further concluded that § 92, addressing insurance sales by banks in towns with no more than 5,000 people, did not impede his approval; for purposes of that provision, the Comptroller explained, annuities do not rank as "insurance." See Comptroller's Letter 41a—47a.

Respondent Variable Annuity Life Insurance Co. (VALIC), which sells annuities, challenged the Comptroller's decision. VALIC filed suit in the United States District Court for the Southern District of Texas seeking declaratory and injunctive relief pursuant to the Administrative Procedure Act, 5 U. S. C. § 706(2)(A), and 28 U. S. C. §§ 2201, 2202 (1988 ed. and Supp. V). The District Court granted summary judgment in favor of the Comptroller and NationsBank. Variable Annuity Life Ins. Co. v. Clarke, 786 F. Supp. 639 (1991). The United States Court of Appeals for the Fifth Circuit reversed. Variable Annuity Life Ins. Co. v. Clarke, 998 F. 2d 1295 (1993). Relying on its decision in Saxon v. Georgia Assn. of Independent Ins. Agents, Inc., 399 F. 2d 1010 (1968), the Fifth Circuit first held that § 92 bars banks not located in small towns from selling insurance, and then rejected the Comptroller's view that annuities are not insurance for purposes of § 92. See 998 F. 2d, at 1298-1302.

Four judges dissented from the failure of the court to grant rehearing en banc. The dissenters maintained that the panel had not accorded due deference to the Comptroller's reasonable statutory interpretations. Variable Annu- [256] ity Life Ins. Co. v. Clark[e], 13 F. 3d 833, 837-838 (CA5 1994).^[3] We granted certiorari. 511 U. S. 1141 (1994).

II

A

Authorizing national banks to "carry on the business of banking," the National Bank Act provides that such banks shall have power—

"To exercise . . . all such incidental powers as shall be necessary to carry on the business of banking; by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion; by loaning money on personal security; and by obtaining, issuing, and circulating notes . . . . The business of dealing in securities and stock by the [bank] shall be limited to purchasing and selling such securities and stock without recourse, solely upon the order, and for the account of, customers, and in no case for its own account, and the [bank] shall not underwrite any issue of securities or stock . . . ." 12 U. S. C. § 24 Seventh (1988 ed. and Supp. V).

As the administrator charged with supervision of the National Bank Act, see §§ 1, 26-27, 481, the Comptroller bears primary responsibility for surveillance of "the business of banking" authorized by § 24 Seventh. We have reiterated:

"`It is settled that courts should give great weight to any reasonable construction of a regulatory statute adopted by the agency charged with the enforcement of that statute. The Comptroller of the Currency is charged with the enforcement of banking laws to an extent that warrants the invocation of this principle with [257] respect to his deliberative conclusions as to the meaning of these laws.' " Clarke v. Securities Industry Assn., 479 U. S. 388, 403-404 (1987) (quoting Investment Com- pany Institute v. Camp, 401 U. S. 617, 626-627 (1971)).

Under the formulation now familiar, when we confront an expert administrator's statutory exposition, we inquire first whether "the intent of Congress is clear" as to "the precise question at issue." Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, 842 (1984). If so, "that is the end of the matter." Ibid. But "if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute." Id., at 843. If the administrator's reading fills a gap or defines a term in a way that is reasonable in light of the legislature's revealed design, we give the administrator's judgment "controlling weight." Id., at 844.

In authorizing NationsBank to broker annuities, the Comptroller invokes the power of banks to "broker a wide variety of financial investment instruments," Comptroller's Letter 38a, which the Comptroller considers "part of [banks'] traditional role as financial intermediaries," ibid., and therefore an "incidental powe[r] . . . necessary to carry on the business of banking." 12 U. S. C. § 24 Seventh; see also Interpretive Letter No. 494 (Dec. 20, 1989) (discussing features of financial investment instruments brokerage that bring this activity within the "business of banking") (cited in Comptroller's Letter 38a). The Comptroller construes the § 24 Seventh authorization of "incidental powers . . . necessary to carry on the business of banking" as an independent grant of authority; he reads the specific powers set forth thereafter as exemplary, not exclusive.

VALIC argues that the Comptroller's interpretation is contrary to the clear intent of Congress because the banking power on which the Comptroller relies—"broker[ing] financial investment instruments"—is not specified in § 24 Seventh. [258] Brief for Respondent 35-45. According to VALIC, the five specific activities listed in § 24 Seventh after the words "business of banking" are exclusive—banks are confined to these five activities and to endeavors incidental thereto. Id., at 35-36. VALIC thus attributes no independent significance to the words "business of banking." We think the Comptroller better comprehends the Act's terms.

The second sentence of § 24 Seventh, in limiting banks' "dealing in securities," presupposes that banks have authority not circumscribed by the five specifically listed activities. Congress' insertion of the limitation decades after the Act's initial adoption makes sense only if banks already had authority to deal in securities, authority presumably encompassed within the "business of banking" language which dates from 1863. VALIC argues, however, that the limitation was imposed by the Glass-Steagall Act of 1933, and that the power Glass-Steagall presupposed was specifically granted in the McFadden Act of 1927. Brief for Respondent 46. While the statute's current wording derives from the Glass-Steagall Act, see Act of June 16, 1933, ch. 89, § 16, 48 Stat. 184, the earlier McFadden Act does not bolster VALIC's case, for that Act, too, limited an activity already part of the business national banks did. See Act of Feb. 25, 1927, § 2(b), 44 Stat. 1226 ("Provided, That the business of buying and selling investment securities shall hereinafter be limited to buying and selling without recourse . . . ."); see also Clarke v. Securities Industry Assn., 479 U. S., at 407— 408 (even before the McFadden Act, banks conducted securities transactions on a widespread basis); 2 F. Redlich, The Molding of American Banking: Men and Ideas, pt. 2, pp. 389— 393 (1951) (describing securities activities of prominent early national banks).^[4]

[259] B

As we have just explained, the Comptroller determined, in accord with the legislature's intent, that "the business of banking" described in § 24 Seventh covers brokerage of financial investment instruments, and is not confined to the examples specifically enumerated. He then reasonably concluded that the authority to sell annuities qualifies as part of, or incidental to, the business of banking. National banks, the Comptroller observed, are authorized to serve as agents for their customers in the purchase and sale of various financial investment instruments, Comptroller's Letter 38a,^[5] and annuities are widely recognized as just such investment products. See D. Shapiro & T. Streiff, Annuities 7 (1992) & "[a]nnuities (in contrast to life insurance, . . . are primarily investment products"); 1 J. Appleman & J. Appleman, Insurance Law and Practice § 84, p. 295 (1981) ("Annuity contracts must . . . be recognized as investments rather than as insurance.").

By making an initial payment in exchange for a future income stream, the customer is deferring consumption, setting aside money for retirement, future expenses, or a rainy day. For her, an annuity is like putting money in a bank account, a debt instrument, or a mutual fund. Offering bank accounts and acting as agent in the sale of debt instruments and mutual funds are familiar parts of the business of banking. See, e. g., Securities Industry Assn. v. Board of Governors, FRS, 468 U. S. 207, 215 (1984) ("Banks long have arranged the purchase and sale of securities as an accommodation to their customers."); First Nat. Bank of Hartford v. Hartford, 273 U. S. 548, 559-560 (1927) (banks have authority [260] to sell mortgages and other debt instruments they have originated or acquired by discount).

In sum, modern annuities, though more sophisticated than the standard savings bank deposits of old, answer essentially the same need. By providing customers with the opportunity to invest in one or more annuity options, banks are essentially offering financial investment instruments of the kind congressional authorization permits them to broker. Hence, the Comptroller reasonably typed the permission NationsBank sought as an "incidental powe[r] . . . necessary to carry on the business of banking."^[6]

III

A

In the alternative, VALIC argues that 12 U. S. C. § 92 (1988 ed., Supp. V) bars NationsBank from selling annuities as agent. That section provides:

"In addition to the powers now vested by law in [national banks] any such [bank] located and doing business in any place the population of which does not exceed five thousand inhabitants . . . may . . . act as the agent for any fire, life, or other insurance company authorized by the authorities of the State in which said bank is located to do business in said State, by soliciting and selling insurance and collecting premiums on policies issued by such company . . . ."

The parties disagree about whether § 92, by negative implication, precludes national banks located in places more populous than 5,000 from selling insurance. We do not reach [261] this question because we accept the Comptroller's view that, for the purpose at hand, annuities are properly classified as investments, not "insurance."

Again, VALIC contends that the Comptroller's determination is contrary to the plain intent of Congress, or else is unreasonable. In support of its position that annuities are insurance, VALIC notes first that annuities traditionally have been sold by insurance companies. But the sale of a product by an insurance company does not inevitably render the product insurance. For example, insurance companies have long offered loans on the security of life insurance, see 3 Appleman & Appleman, Insurance Law and Practice § 1731, p. 562 (1967), but a loan does not thereby become insurance.

VALIC further asserts that most States have regulated annuities as insurance and that Congress intended to define insurance under § 92 by reference to state law. Treatment of annuities under state law, however, is contextual. States generally classify annuities as insurance when defining the powers of insurance companies and state insurance regulators. See, e. g., 998 F. 2d, at 1300, n. 2 (citing statutes). But in diverse settings, States have resisted lump classification of annuities as insurance. See, e. g., In re New York State Assn. of Life Underwriters, Inc. v. New York State Banking Dept., 83 N. Y. 2d 353, 363, 632 N. E. 2d 876, 881 (1994) (rejecting "assertion that annuities are insurance which [statechartered] banks are not authorized to sell," even though state insurance law "includes `annuities' in its description of `kinds of insurance authorized' "); In re Estate of Rhodes, 197 Misc. 232, 237, 94 N. Y. S. 2d 406, 411 (Surr. Ct. 1949) (annuity contracts do not qualify for New York estate tax exemption applicable to insurance); Commonwealth v. Metropolitan Life Ins. Co., 254 Pa. 510, 513-516, 98 A. 1072, 1073 (1916) (annuities are not insurance for purposes of tax that insurance companies pay on insurance premiums received within [262] the State); State ex rel. Equitable Life Assurance Soc. of United States v. Ham, 54 Wyo. 148, 159, 88 P. 2d 484, 488 (1939) (same).

As our decisions underscore, a characterization fitting in certain contexts may be unsuitable in others. See, e. g., Atlantic Cleaners & Dyers, Inc. v. United States, 286 U. S. 427, 433 (1932) ("meaning [of words] well may vary to meet the purposes of the law"; courts properly give words "the meaning which the legislature intended [they] should have in each instance"); cf. Cook, "Substance" and "Procedure" in the Conflict of Laws, 42 Yale L. J. 333, 337 (1933) ("The tendency to assume that a word which appears in two or more legal rules, and so in connection with more than one purpose, has and should have precisely the same scope in all of them, runs all through legal discussions. It has all the tenacity of original sin and must constantly be guarded against."). Moreover, the federal banking law does not plainly require automatic reference to state law here. The Comptroller has concluded that the federal regime is best served by classifying annuities according to their functional characteristics. Congress has not ruled out that course, see Chevron, 467 U. S., at 842; courts, therefore, have no cause to dictate to the Comptroller the state-law constraint VALIC espouses.

VALIC further argues that annuities functionally resemble life insurance because some annuities place mortality risk on the parties. Under a classic fixed annuity, the purchaser pays a sum certain and, in exchange, the issuer makes periodic payments throughout, but not beyond, the life of the purchaser. In pricing such annuities, issuers rely on actuarial assumptions about how long purchasers will live.

While cognizant of this similarity between annuities and insurance, the Comptroller points out that mortality risk is a less salient characteristic of contemporary products. Many annuities currently available, both fixed and variable, do not feature a life term. Instead they provide for payments over a term of years; if the purchaser dies before the term ends, [263] the balance is paid to the purchaser's estate. Moreover, the presence of mortality risk does not necessarily qualify an investment as "insurance" under § 92. For example, VALIC recognizes that a life interest in real property is not insurance, although it imposes a mortality risk on the purchaser. Tr. of Oral Arg. 42. Some conventional debt instruments similarly impose mortality risk. See Note, Reverse Annuity Mortgages and the Due-on-Sale Clause, 32 Stan. L. Rev. 143, 145-151 (1979).

B

VALIC also charges the Comptroller with inconsistency. As evidence, VALIC refers to a 1978 letter from a member of the Comptroller's staff describing annuity investments as insurance arrangements. Brief for Respondent 16-17; see Letter from Charles F. Byrd, Assistant Director, Legal Advisory Services Division, Office of the Comptroller of the Currency (June 16, 1978), App. to Brief in Opposition 1a—2a (Byrd Letter). We note, initially, that the proposal disfavored in the 1978 letter did not clearly involve a bank selling annuities as an agent, rather than as a principal. See Byrd Letter 1a ("[T]he bank would purchase a group annuity policy from an insurer and then sell annuity contracts as investments in trust accounts."). Furthermore, unlike the Comptroller's letter to NationsBank here, the 1978 letter does not purport to represent the Comptroller's position. Compare Byrd Letter 1a ("It is my opinion . . . ") with Comptroller's Letter 35a ("The OCC's legal position on this issue was announced in a [prior 1990 letter]. Since I find neither policy nor supervisory reasons to object to this proposal, the Subsidiary may proceed."). Finally, any change in the Comptroller's position might reduce, but would not eliminate, the deference we owe his reasoned determinations. See Good Samaritan Hospital v. Shalala, 508 U. S. 402, 417 (1993) (quoting NLRB v. Iron Workers, 434 U. S. 335, 351 (1978)).

The Comptroller's classification of annuities, based on the tax deferral and investment features that distinguish them [264] from insurance, in short, is at least reasonable. See Comptroller's Letter 44a. A key feature of insurance is that it indemnifies loss. See Black's Law Dictionary 802 (6th ed. 1990) (first definition of insurance is "contract whereby, for a stipulated consideration, one party undertakes to compensate the other for loss on a specified subject by specified perils"). As the Comptroller observes, annuities serve an important investment purpose and are functionally similar to other investments that banks typically sell. See supra, at 259-260. And though fixed annuities more closely resemble insurance than do variable annuities, fixed annuities too have significant investment features and are functionally similar to debt instruments. Moreover, mindful that fixed annuities are often packaged with variable annuities, the Comptroller reasonably chose to classify the two together.

* * *

We respect as reasonable the Comptroller's conclusion that brokerage of annuities is an "incidental powe[r] . . . necessary to carry on the business of banking." We further defer to the Comptroller's reasonable determination that 12 U. S. C. § 92 is not implicated because annuities are not insurance within the meaning of that section. Accordingly, the judgment of the Court of Appeals for the Fifth Circuit is

Reversed.

[1] Together with No. 93-1613, Ludwig, Comptroller of the Currency, et al. v. Variable Annuity Life Insurance Co. et al., also on certiorari to the same court.

[2] Briefs of amici curiae urging reversal were filed for the American Bankers Association et al. by John J. Gill III, Michael F. Crotty, James T. McIntyre, Richard M. Whiting, and David L. Glass; for the Conference of State Bank Supervisors et al. by David W. Roderer, Eric L. Hirschhorn, Donn C. Meindertsma, J. Thomas Cardwell, Leonard J. Rubin, and M. Brooks Senn; and for the New York Clearing House Association by John L. Warden, Michael M. Wiseman, Theodore Edelman, and Norman R. Nelson.

[3] The dissenters also observed that 6 of the court's 13 active judges were disqualified from participating in the case. 13 F. 3d, at 834.

[4] We expressly hold that the "business of banking" is not limited to the enumerated powers in § 24 Seventh and that the Comptroller therefore has discretion to authorize activities beyond those specifically enumerated. The exercise of the Comptroller's discretion, however, must be kept within reasonable bounds. Ventures distant from dealing in financial investment instruments—for example, operating a general travel agency—may exceed those bounds.

[5] The Comptroller referred to Interpretive Letter No. 494 (Dec. 20, 1989) (approving brokerage of agricultural, oil, and metals futures).

[6] Assuring that the brokerage in question would not deviate from traditional bank practices, the Comptroller specified that NationsBank "will act only as agent, . . . will not have a principal stake in annuity contracts and therefore will incur no interest rate or actuarial risks." Comptroller's Letter 48a.