Mayor Bloomberg and Governor Pataki yesterday announced with some fanfare that Carver Federal Savings Bank is opening a new branch in Jamaica, Queens. That’s no doubt welcome news to residents of that neighborhood. What troubles us, however, is that the bank is going to be receiving a special subsidy from the rest of the city’s already hard-pressed taxpayers. According to the City Hall press release announcing the deal, “the branch will receive up to $10 million in deposits of City funds. Carver will pay the City below-market rates. In return, the bank will provide loans and offer financial literacy classes enabling residents to take advantage of banking services to improve their lives.”

You might have thought that with the city’s streets full of gaping potholes, firehouses closing, and combined state and local taxes that are among the highest in the nation, New York City would want to get all the interest it could possibly muster on its deposits, not “below-market rates.”What the bank is promising in return is underwhelming. Providing loans is, after all, what banks are supposed to do. If things are working right, they do it to make money, not to induce the city to deposit money at below-market rates. As for the “financial literacy classes,” they sound to us like a marketing tool for the bank. We’ve got no problem with Carver offering such classes, but it’s hard to see the need for a city subsidy.

If the bank can’t make enough money at this location to make it worthwhile without a subsidy from the city, maybe that’s the market’s way of saying there shouldn’t be a bank there at all. Maybe a not-for-profit credit union would be a better fit. As it is, there are eight credit unions that already exist in Jamaica, Queens, according to the New York State Credit Union League.

Under the 1998 state law Governor Pataki was touting yesterday, the subsidies don’t necessarily stop at below-market-rate deposits. Banks are also entitled to a 10-year break of up to 50% on their property taxes. Carver is renting, not buying, its Jamaica spot, so the subsidy doesn’t apply in this case. That’s just as well, as it’s hard to see why the property-owning shareholders of other New York banks — whether they be Citibank, Signature, Commerce, Greenpoint, or Chase — should be forced by this law to subsidize their competition.

It’s not as if Carver is without its own connections. One big owner of the bank’s shares is Richard Parsons, who, as the CEO of Time Warner, isn’t exactly in need of a subsidy from the city. A Carver director is Strauss Zelnick, the former record company executive who founded ZelnickMedia.

If Mr. Parsons and Mr. Zelnick, both businessmen we very much admire, want to open a bank branch in Jamaica, Queens, they’ve got our every best wish. But if they want the taxpayers of New York to deposit city funds there, it seems only reasonable to ask them to pay the market rate.