The High Court has decided to rule next year on a case that pits national banks against state regulators, reports Bloomberg. The case the court will review pits Michigan’s mortgage regulations against Winston-Salem, N.C.-based Wachovia’s claim that federal bank regulations pre-empt any state rules.

Similar disputes have arisen in Connecticut, Maryland and California where states have tried to impose greater protections for borrowers than the federal regulations. The Bush administration urged the court not to take the case, saying that banks could simply choose whether to create local subsidiaries subject to state regulation or whether to remain national and abide by federal rules.

Wachovia prevailed in the Cinncinnati-based 6th U.S. Circuit Court of Appeals and that is very likely where the Supreme Court is heading too, so don’t expect a big push in other states for more local regulation. For the most part, those states accept Wachovia’s position that they can only be regulated by the feds.