When is good credit too good?

An Ohio bank that issues credit cards wants to reject the most creditworthy borrowers.

Here's one you don't see often: a bank threatening to turn away customers who pay off their credit cards too quickly

Gander Mountain Co. says in a federal lawsuit made public Thursday in Minneapolis that the bank that issues its "co-branded" cards is threatening to deny new applications from about 25 percent of the sporting goods chain's customers -- those with the highest credit scores. The St. Paul-based company wants a court order blocking the practice.

The bank, World Financial Network National Bank of Columbus, Ohio, said it loses money on such customers since they tend not to carry balances or incur late fees.

Experts said they've never heard of a bank turning away financially responsible credit card customers.

"Most of my clients, which are the top banks in America, are jealously guarding their better clients and finding ways to satisfy them as opposed to turning them away," said Robert Hammer of RK Hammer Investment Bankers in Los Angeles. "It's not something I've done in my 30 years in this business."

World Financial, which did not respond Thursday to a request for comment, has more than 85 credit card programs with retailers that include Limited Brands and Redcats USA.

Bill Ryan, managing director of New York research boutique Portales Partners, said World Financial's parent company, Alliance Data Systems, generates a lot of its revenue from what are referred to as junk fees, or late fees. Consumers with stellar credit usually have the wherewithal to avoid paying them, he said.

While it's true that banks don't make much interest from customers who pay off their cards regularly, Ryan said, that's offset somewhat by the fact that creditworthy cardholders tend to use their cards more often, generating transaction fees for banks.

Those customers also pay annual card fees and have negligible charge-offs, he noted.

"I have to admit, this is one of the first times I've seen a company refuse to write high-end credits," Ryan said.