New York City Treasurer Elaine Koss said at a City Council hearing on Monday that the Bloomberg administration opposes a bill that would require the city to rank banks based on the quality of services they provide, a proposal that has unnerved some bank executives because it's aimed at shaming institutions that are perceived to be treating the public poorly, according to an article in yesterday's edition of The Wall Street Journal by Michael Howard Saul.

Ms. Koss praised the legislation's intent, but said it may jeopardize the city's cash-management activities, the article said.

In a heated exchange with her, Domenic Recchia Jr., the chairman of the council's finance committee, said "It's time that banks step up to the plate and help the people of the city of New York," adding that "This City Council is no longer going to sit back and let banks get millions of dollars in deposits and let the Banking Commission just sit back and do nothing," the article said. The Banking Commission consists of the mayor, the comptroller and the finance department commissioner and it designates the banks in which city money can be deposited, the article noted.

"Under the legislation," the article continued, "the finance commissioner would be required to establish a classification system that would rank city depository banks based on their community involvement and the commissioner would have to consider, among other criteria. the bank's efforts to address the credit and financial services of small businesses; to work with borrowers to restructure delinquent home-mortgage loans; and to develop financial services that are needed by low- and moderate-income New Yorkers."

Speaker Christine Quinn, the article added, said that "it's reasonable to 'expect a banking institution that profits from the city to assist struggling homeowners and small businesses.

The article said that "Michael Smith, president and CEO of the New York Bankers Association, an umbrella group of banks," said that the legislation "would impose a subjective, new, unnecessary, and duplicative burden of reporting on banks in order for them to do business with the city," adding that "the proposal interjects a potentially high degree of new subjectivity into the ranking and depository selection process, while lacking sufficient flexibility in its criteria to accommodate the city's varied banking entities."

Councilman Al Vann, the lead sponsor of the legislation and chairman of the council's Community Development Committee, said the city deposits more than $6 billion into various banks, the article said.