Mayor Marion Barry's administration proposed yesterday to replace the regional banking legislation recently adopted by the City Council with a new comprehensive interstate banking bill that would, in effect, open the District to the nation's largest banks in two years and, in certain instances, sooner.

The new proposal was unveiled by Curtis McClinton, deputy mayor for economic development, before the City Council's Housing and Economic Development Committee instead of an expected bill to establish an office to regulate District banks.

McClinton told reporters that the mayor intends for the new proposal to serve as a comprehensive approach to interstate banking and to replace the legislation already adopted by the council.

The proposal, which surprised the District's banking industry, comes on the heels of an aggressive lobbying campaign by New York's Citicorp to win a banking license here that would let it collect deposits in the District, the only banking service it may not now provide.

The regional banking legislation adopted by the council, but not signed by the mayor, would allow banks in the District and 11 southeastern states to merge with and acquire each other. In enacting it, the council rejected a so-called "trigger" provision that would have allowed let the nation's largest banks, called money-center banks, to enter the District after two years.

Under Barry's new proposal, any bank could get a banking license in the District after two years. Under a "special entry" provision, any bank could obtain a limited license earlier if it met criteria that include an investment of more than $100 million in the District within two years and the hiring of at least 200 District residents.

Banks granted special entry would also be required to restrict their activities to the areas that a banking superintendent, who would be appointed by the mayor, designated as having inadequate banking services. McClinton said the restriction would mean that Citicorp or any other money-center bank would be confined for two years to accepting deposits in economically depressed areas such as those in Wards 6, 7 and 8. Any bank that violated the special-entry requirements could be fined up to $50,000 or lose its license.

District banking community representatives have argued that letting the money-center banks provide full banking services would create an unfair advantage.

"I think this will step up the level of intensity of the lobbying activity," Roger Conner, spokesman for American Security Bank, said yesterday. "The D.C. banks will continue to put forth their position to the mayor and to the City Council members."

But witnesses representing some community groups said they were pleased that the new bill centers on making banks responsive to District neighborhoods.

"The debate has shifted from who comes in to the guidelines under which they come in," said Larry Weston, director of the Metropolitan Washington Housing and Planning Association. "Our agency is going to urge the mayor to veto the council legislation and go the route of the substitute bill."