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Unless players can rebuy the games they were banned from (to get unbanned), I'm not OK with this. One's Steam account could be worth a lot, and giving individual developers the power to ruin the reputation of said Steam account is not acceptable unless players can do something against it. That is, I don't exactly trust individual developers with their possibly hand-picked bans. In too many cases where bans are issued manually by servers admins and such, have I seen innocent players get banned just because the admin deemed the player too good to be playing without cheats.

Also, I don't agree with the bans showing on one's profile. Hand-picked bans shouldn't be able to do that, only bans issued by some automatic system. Like I said, too much room for abuse otherwise.