"Many predicted that Gramm-Leach-Bliley would lead to giant mergers, after which only one or two giant companies would remain standing, and that those companies would offer everything. But that is not the model that has emerged at all," he added.

Gordon Stewart, president of the Insurance Information Institute in New York, which co-sponsored the event, agreed, noting that, "when the gun was fired and Gramm-Leach-Bliley was launched, the great convergence rush was supposed to start. And although there have been mergers, it is not as though all the major players suddenly coalesced into one clump of galactic matter."

What has actually happened, Mr. Stewart said, was that banks have tended to buy individual securities firms and insurance agencies, but not whole insurers, while both banks, insurance companies and insurance agencies began to offer a wider variety of products.

"So all in all, there is more competition and more choices," he added. "At the same time, individual companies in each sector have developed their own approaches. Small regional banks, finding an important niche, are competing extremely well. Many insurers, often smaller or mid-sized ones, are focusing very successfully on particular lines of businesses, regions or specialties."

Many securities and investment firms are also trying to differentiate themselves. Even retailers such as 7-Eleven Inc. are getting into the act and have begun to offer their own financial services, but there has not been a giant merging of major financial services companies, as was initially expected, he added.

On the flip side, some of the consolidations that have taken place boosted the market share of the largest players in most financial segments.

For example, the asset share of the top 10 U.S. banks grew from 34 percent in 1995 to 40 percent in 2001, Mr. Stewart noted. The asset share of the top 10 property-casualty insurance companies also grew, from 30 percent to 45 percent, while the share of the top 10 life insurance companies rose from 34 percent to 44 percent during the same period, he said.

Mr. Bartlett added that although Gramm-Leach-Bliley became law only three years ago, it is in fact a culmination of the process that started in the early 1980s, with the competitive marketplace and customer demand, rather than Washington lawmakers, began to determine what financial products and services, as well as what distribution channels, companies should offer to customers.

"So the changes that had been predicted from the passage of Gramm-Leach-Bliley, of giant companies offering everything, are not the changes that actually occurred because, in the end, they are not what customers wanted," he said.

However, the biggest change during the past three years probably came from the mindset of Congress, regulators and the overall financial services industry, he said.

"No longer does the U.S. body politic and financial services firms look to regulators to decide what company can offer what product, which customer can buy it, and what the terms and conditions should be, because that is a discriminatory and inefficient system. It limits access to financial services," said Mr. Bartlett. "Instead, the new model looks to customers to determine what products and services should be offered, and then it looks to regulatory agencies to regulate for safety and soundness and to regulate against abusive practices."