The presidents of Tokio Marine & Fire Insurance Co., Asahi Mutual Life Insurance Co. and Nichido Fire & Marine Insurance Co. -- scheduled to consolidate under a holding company in 2004 -- on Thursday denied the possibility of an immediate merger of the companies' subsidiaries.

The presidents spoke during a news conference to announce details of the gradual consolidation of the three insurers into the Millea Insurance Group.

Consolidation will occur in two major stages, they said. The two nonlife insurers and their subsidiaries, Tokio-Marine Anshin Life Insurance Co. and Nichido Life Insurance Co., will first operate under a single holding company by April 2002. Asahi Mutual will then join the group after it is made into a joint-stock holding company, planned by 2004.

But the life insurance arms of the two nonlife insurers will not merge because of the name value of the two subsidiaries and their differing clientele, the officials said.

"Each has its own culture . . . developed over 100 years," said Tokio Marine President Kokei Higuchi, adding that Tokio Marine is strong in wholesale while Nichido is strong in retail.

"But if you ask if Tokio Marine and Nichido will remain separate companies forever . . . that is not settled yet," Higuchi said. "We just do not want to discard our company names without reason."

The three companies announced they will increase total premium income by 17 percent in fiscal 2005 to 3.82 trillion yen, partly by cutting personnel by 20 percent.

Officials said, however, that employees will not be laid off and the companies will continue to hire staff.

"We will channel employees to new domain businesses, while raising efficiency in our core business," Higuchi said.

The firms will set up two committees to oversee the consolidation and the transformation of Asahi Mutual into a joint-stock company, officials said.

The full cost of consolidating Asahi Mutual into a joint-stock company will be a little over 10 billion yen, said Asahi Mutual President Yuzuru Fujita.

Tokio Marine's Higuchi said that the firm may refrain from partially sponsoring Asahi Mutual in its bid to become a joint-stock company, given the suspicions that such action might raise in the life insurance sector, which saw four firms collapse last year.

"If the action will be interpreted as Asahi Mutual needing assistance, instead of as token sponsorship, then it would be better if we didn't provide any assistance," Higuchi said.