In return, the banks would issue new loans and restructure old ones.

The national average is for banks to issue commercial and industrial loans equal to 158 percent of their capital.

It forms the reserves held by private banks, on the strength of which they issue loans to their clients.

The new law will prohibit companies that issue such loans or buy them on the resale market from doing business with the city.

The private banks issued loans to start-up companies, with stocks as security.

Bond: A loan issued by an institution to fund projects and operations.

The fear, they say, is that the company will issue riskier loans if it has too small an interest in them after they are sold.

The bill would prohibit companies that issue predatory loans or buy them on the resale market from doing business with the city.

Rather, they stem from a sharp and early spike in the default rates among loans issued last year.

In 2005, fewer than 1 percent of all the loans issued in the city were backed by these agencies.