BISMARCK, N.D. and ST. LOUIS – Pulling off a corporate credit union merger isn't easy, and sometimes the obstacles are just too much to overcome as was the case with Midwest Corporate FCU and Missouri Corporate CU. In April the two corporates announced their plans to merge, but those plans are now dead. The issue was differences in overnight account structures. The variations in their structures made it difficult for the two corporates to agree on a solution that wouldn't negatively impact one or the other, or their members. Missouri Corporate President/CEO Dennis DeGroodt was disappointed the merger won't happen, but he is happy the due diligence process worked like it's supposed to. "I think it shows the due diligence process works. We looked at in terms of when a couple gets engaged before getting married. That's when you figure out what you like and don't like, that's the time to say `let's not do this'," said DeGroodt. DeGroodt said although there were far more similarities than differences between the corporates, the overnight account is such an important account at corporates, the effects of changing it can change the way their members do business with the corporate. Missouri Corporate has a single-rate overnight account, meaning if a member has $10 million or $10,000 in the account, they receive the same rate. Midwest uses a tiered-rate structure, where the rate of return is determined by the amount of deposits. Midwest's members keep more money in their overnight accounts, while at Missouri there's proportionately more dollars in term investments. If Midwest had agreed to go to a single rate structure, many of its members would lose return, while if Missouri went to a tiered structure, DeGroodt said it would cause its members to begin to have to manage their overnight accounts daily, as they need to worry about having enough funds for settlement. "We didn't want to start a new account that would unduly hurt members, cost us too much money, or cause us ALM problems," said DeGroodt. Wolf said corporate mergers are a lot easier said than done considering the variations in corporate operations. "There's a misconception from people that corporates are very homogenous, but they're not. It's like families. Brothers and sisters may grow up and do the same kinds of things, but they do them differently. Our members became accustomed to the way we do it, and to change the accounts would have been too much of a change for them," said Wolf. Surprisingly though, said Wolf, other than the account problem, the other logistical issues were relatively easy to figure out. The corporates had decided to keep the Midwest name and apply for a Missouri state charter. The offices would have stayed in place as would have the employees. Wolf said the reason calling it off isn't as big a deal as it might have been in some past corporate CU mergers, is this wasn't a merger of necessity. "Nobody here was forced to do anything. We can operate for years and years without any problems. We just thought this was an opportunity," said Wolf. This merger emanated from a meeting some Midwest corporates had about a number of corporates getting together to form a Midwest regional corporate. The idea was initiated by DeGroodt, who said right now there is no action on that front. Both corporates said they will get back to business as usual and any projects that were put on hold because of the merger, will be reinvigorated. [email protected]