market power, the exercise of such power tends to occur in retail markets that are relatively narrow in geographic scope, and for a fairly well - defined set of customers, usually households and small businesses. however, a special influence on local market competition may develop as bank consolidation and interstate branching continue, resulting in the largest banks competing with each other in an increasing number of local markets. such widespread competitive contacts may cause these firms to temper their competitive behavior in individual markets in recognition of the potential for responses by their rivals in other common markets and in recognition of their widespread mutual interests. so, what has happened to banking concentration in local markets since 1980? the answer is, “ not much ”. for example, the average three - bank deposit concentration ratio in metropolitan statistical areas, a common measure of local urban markets, hovered between 65 and 68 percent between 1980 and 1997. concentration measures for rural counties show similar results, with the average three - bank concentration ratio remaining at about 89 percent throughout the period. other measures of local market concentration show similar results for both urban and rural areas. the stability of local market concentration in the face of such a large consolidation of the banking industry is remarkable. while there is no single reason for this stability, i would point to two factors as being of particular importance. many mergers, including some mergers of very large banks, involve institutions that do not compete in the same local markets. in such cases, local market concentration is obviously not affected. where the merging banks do compete in the same local markets, enforcement of the antitrust laws has been an important factor limiting the growth of local market concentration. moreover, antitrust enforcement has no doubt deterred some highly anti - competitive mergers from even being proposed. why have banks been consolidating in number and expanding in size and geography? again, no one answer is appropriate, and each merger is somewhat unique and reflects more than one factor. in recent years many banks have been responding to the removal [UNK] of barriers to interstate banking and branching that restricted entry and divided markets. in such cases, the twin desires to diversify risk geographically and to expand sources of “ core ” deposits have surely been important motivating forces. moreover, geographic barriers had constrained natural market developments ; in an important sense their removal has simply allowed the market to adjust to a new economic equilibrium from a previously legally mandated equilibrium. beyond such adjustments, scale economies are mentioned frequently by bankers as a causal factor in bank consolidation, although academic research has not tended to find

working. as has been said, “ banking is saving … pension is the reward for saving. ” in this context, we look forward to a stronger and self - sustaining sss. for the sss, sustained economic growth can only mean more members and better yields on its funds. in the case of sss and the bsp, we share a common goal of financial education to empower and help improve the lives of filipinos. the bsp has a national economic and financial learning program that reaches out to all age groups starting from grade i to college students to young professionals as well as overseas filipinos and their families. the capability of sss to reach out to millions of its members gives it tremendous advantage in promoting financial education. we are confident that sss, under the leadership of chairman santos and pres. de quiros will not pass on this chance to nurture financial literature and more financially - stable filipinos. we can work on this together. the bsp and sss. in the process, we will help maintain the stability of our financial system and promote sustained economic growth that is truly inclusive. once again, congratulations to the women and men of the sss on your 57th anniversary. mabuhay ang sss! mabuhay ang ating mahal na bansang pilipinas! maraming salamat sa inyong lahat. bis central bankers ’ speeches