Bankers have been handed yet another defeat in their legal struggle to rein in credit unions, this time in Nebraska.

The Nebraska District Court of Lancaster County on Feb. 7 upheld an expansion for Western Heritage Credit Union granted last year by the state's banking department.

The regulator let the credit union expand into 11 adjacent counties in the state's panhandle, and the banks were seeking to overturn it.

In a 15-page ruling, the court said the expanded area did possess a common bond and deemed irrelevant bankers complaints of increased competition.

"Courts have found that the purpose of the (credit union act) is not to protect the competitive interests of banks," the decision said. "The fact that banks may be hurt competitively due to legal competition is irrelevant to this court's decision."

Nebraska becomes the fifth state in which courts have rejected banker efforts to clamp down on credit unions. Bankers in seven states have sued credit unions.

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