New York City Banking Commission Announces Measures to Ensure City’s Designated Banks More Accountable to The Public

New York, NY – New York City Comptroller Brad Lander, New York City Mayor Eric Adams, and New York City Department of Finance (DOF) Commissioner Preston Niblack today announced two important transparency measures that will help gauge the consumer and community service experience of the city’s designated banks and provide a tool for better assessing the commitment of banks looking to hold city deposits to non-discrimination in lending and employment.

Starting with this year’s biennial designation cycle, the New York City Banking Commission (consisting of Mayor Adams, Comptroller Lander, and DOF Commissioner Niblack) will include a public comment process for the Banking Commission’s public hearing to designate banks that will be eligible to hold deposits of city funds. The public will be able to submit written comments ahead of the meeting and in-person comments during the public comment session of the hearing.

Additionally, the certificates banks must submit ahead of designation have been revised to reinforce the obligation for depository banks to provide detailed plans and specific steps to combat different forms of discrimination in their operations.

“Consumer banks play a vital role in New York City’s communities, and their practices in lending, employment, and banking products and services reverberate through all five boroughs,” said Comptroller Lander. “In pursuit of a shared and prosperous economy for all, the city must be vigilant in evaluating the banks that hold its money and hear from New Yorkers about their experiences with these institutions. I am grateful to Mayor Adams and Commissioner Niblack for their partnership in this work, as we continue to take a hard look at who the city is choosing as banking partners.”

“Financial institutions are critical pillars of our communities, and we must demand the highest standards from any bank that is entrusted with public funds,” said Mayor Adams. “These new steps will ensure the Banking Commission is designating only those banks that have shown that they can protect taxpayer money and that are committed to promoting equity in all aspects of their operations.”

“Providing an opportunity for public comment will add a new dimension to the Banking Commission’s designation review,” said New York City Treasurer Mary Christine Jackman, DOF designee, New York City Banking Commission. “We look forward to hearing from the public and banking community as we review applications for designation for the important role of depository of the public’s funds.”

Designated banks will be eligible to hold New York City deposits. The banks are expected to provide approved banking products and services for city entities. By law, the banks must provide total collateralization for any money held.

“The ability to hold and profit from New Yorker’s hard-earned city deposits is a privilege, not a right,” said Barika X. Williams, executive director, Association for Neighborhood and Housing Development. “We applaud the Banking Commission on taking this step to accept public comments and call on the city to incorporate the findings into their final determinations. We hope this is just a first step in deepening community engagement, scrutiny, and transparency in this public process. The city must demand more of banks seeking the privilege of holding New York City’s deposits and should not do business with banks that ignore, divest, exploit, or discriminate against communities of color.”

“We are pleased that the New York City Banking Commission will seek the public’s input on how best to ensure that banks holding city deposits meet the highest standards,” said Andy Morrison, associate director, New Economy Project. “Where the city deposits its billions of dollars is a fundamental matter of public policy, and we must demand that our public money is not held by banks that redline and otherwise harm New Yorkers and New York City neighborhoods.”

Upcoming meetings of the New York City Banking Commission will be held on the following dates: May 11, 2023, for the discount/late payment rate recommendation meeting and May 25, 2023, for the bank designation meeting, including public comments. Bank designations will be voted on by the commission at the latter meeting. More information can be found online.

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