adopt technology in a time - bound framework. presently, only 32 % ( 510 out of 1589 as on march, 2014 ) of ucbs have adopted core banking solution ( cbs ). delay in adopting technology has resulted in ucbs losing their customers to commercial banks. they also become vulnerable to frauds due to use of applications that are outdated or lacking security features, etc. also manual book - keeping system has led to arrears in reconciliation of accounts and made them vulnerable to frauds. 34. rbi has advised ucbs to adopt cbs in a graduated framework : large ucbs by dec 31, 2013, tier i banks by june 30, 2014 and unit banks by dec 31, 2014. in future, reserve bank will definitely look forward to more technology - savvy ucbs competing with commercial banks for customer spaces. cooperative character of ucbs 35. apart from the cooperativeness among cooperative banks, the next issue to ponder over is the cooperativeness inside a cooperative bank. we observe that over the years, many ucbs have lost their cooperative character and have been reduced to almost family run institutions. to ensure cooperative membership, rbi has prescribed that the proportion of borrowing nominal members should be limited to 20 % of regular members. some large multistate ucbs have aligned their business models and goals with those of commercial banks while availing the concessions to the sector. 36. in this context, a study was undertaken by the rbi on cooperativeness of cooperative banks. the study found that the cooperative business model has withstood the test of times in several countries in the world and also weathered the recent financial crisis in the most non - disruptive manner while commercial entities have struggled to stay afloat. what has seen them through is the cooperativeness in their character, which is somehow getting diluted in the indian ucbs. the assessment of the study establishes that “ cooperativeness of cooperative banks ” in india is on the decline. 37. rbi, therefore, conducted a seminar on this subject in september last year to sensitize the cooperative banks on this crucial issue. some of the steps to enhance the cooperativeness in ucbs in india could be increasing member awareness to strengthen the democratic character, focus on member education and rekindle members ’ interest in the principles of cooperation. steps can be also taken to increase in the quorum requirement for bis central bankers ’ speeches annual general body meetings, make provision of electronic and secure remote voting facility and cap the tenure / term of the directors

accord. for a more detailed review of these attributes, see p. jenkins, " canada's financial sector : responses to the global crisis " ( presentation to the colombian banking association, cartagena, colombia, 10 july 2009 ). see " renewal of the inflation control target, background information " ( ottawa : bank of canada, november 2006 ). in the price - level - target approach to inflation control, bygones are not bygones, unlike the current policy. under price - level targeting, if inflation has been below trend, causing the price level to fall below target, monetary policy would need to generate above - trend inflation for a while to return the price level to target. or, if inflation has been above trend, lifting the price level above its target, the central bank would need to temporarily induce below - trend inflation to return the price level to its target path over time. see various articles, bank of canada review ( ottawa : bank of canada, spring 2009 ). in terms of financial stability, what we have witnessed over the past two years has been an increasingly complex set of interrelationships among credit, market, and funding risks. these interrelationships, involving key segments of the global financial system, have had significant consequences for economies worldwide – consequences that have brought to the fore the critical importance of effectively managing liquidity, credit, and market risks, as well as the importance of ensuring adequate levels of capital. in several of these areas, canada – as i noted earlier – has stood out for the sound management, regulation, and supervision of its financial institutions. however, the focus at this micro level is not enough. indeed, another key lesson of the global financial crisis has been a recognition of the need for oversight of the system as a whole, including both systemically important institutions and markets. such an approach is critical, because systemic risks can arise from the collective actions of institutions and market participants that, at the individual level, may appear to mitigate risk, but that collectively – because of interconnectness and common exposure – contribute to the instability of the system overall. the off - loading of assets in illiquid markets is just one example. a system - wide, or macroprudential, approach is the shared responsibility of the department of finance and all of the federal financial regulatory authorities, including of course the bank of canada, the office of the superintendent of financial institutions, and the canada deposit insurance corporation. ultimately, it