First Chicago NBD Corp. has completed merging the mutual funds brought together by the marriage of First Chicago Corp. and NBD Bancorp last year.

The newly created Pegasus Funds consist of 22 mutual funds with $12 billion of assets under management. The family was formed by merging First Chicago's Prairie Funds with NBD's Woodward Funds.

"There are so many decisions that need to be made, it sort of overwhelms you," said Marco Hanig, managing director of First Chicago Investment Management Co. The conversion took a year - three months longer than anticipated - he added.

Some decisions needed approval by two-thirds of a fund's shareholders, which was sometimes difficult to obtain, Mr. Hanig said. By the end of last week, shareholders had approved everything First Chicago wanted.

Customer service took a back seat during the fund merger, Mr. Hanig admitted. A bigger issue the company had to deal with was choosing a fund manager for the new fund family.

"Who cares about all the fluffy stuff on the outside?" asked Malcolm Hughes, chief executive of Proudfoot PLC, a London consultancy. "The merged funds' performance is what matters." A company planning to merge mutual funds should pick a fund to lead the investment strategy, he added.

"One should not get something put together on a compromise basis because that solution never works," Mr. Hughes said.

By bringing the funds together, First Chicago will be able to expand its fund business and take advantage of the combined funds' size, Mr. Hanig said. To other banks that want to merge their funds, he offered the following advice:

"Plan, plan, plan. Communicate, communicate, communicate."

First Chicago plans to add a retail fund to the Pegasus group this year, as well as three institutional cash management funds.

Eight Pegasus funds were created by merging similar Prairie and Woodward funds into single portfolios.

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