Voting began this week at Beehive Credit Union over whether to make the financial institution a member-owned mutual savings bank.
If the majority of the credit union's 22,000 members vote in favor of the proposition, the credit union could open new branches in Utah or Davis counties and offer larger business loans.
But some members are concerned that a member-owned mutual savings bank is one step away from becoming a shareholder bank, and that the service-oriented nature of the credit union would disappear.
Beehive executives say that's not the case.
"Member owners would have the same voting rights and would still control (Beehive)," chief financial officer Javvis Jacobson said.
Changes in state credit-union law have restricted the manner in which Beehive can offer services, said Scott Jorgensen, Beehive's president and chief executive officer.
For instance, Beehive cannot open new branches in Utah County. It currently has one branch in Provo, far from the bulk of the county's growth in the northwest.
If it became a bank, restrictions on where it did business would be lifted, allowing it to expand from its current eight branches six in Salt Lake County, one in Utah County and one in Washington County.
As a credit union, Beehive can only offer business loans of up to $250,000. Last year, Jorgensen estimated it turned away an estimated $20 million in loans because of restrictions.
As a bank, the cap on loans to businesses would be higher and Beehive could offer different types of loans, Jorgensen said.
The credit union has $188 million in assets. In 2006, it made $1.9 million.
But a group of about 30 members called Beehive Members Protecting Member Interests opposes the move to a mutual savings bank.
"They're financially sound," said member Teri Dial. "They have a large field of membership, and I would like them work harder to remain a credit union."
Another member, Lori Christian, cited a study that showed 75 percent of credit unions able to issue stock have opted to do so. "I predict within two years, it will be a stock bank," she said.Christian and Dial said they plan to leave the credit union if members choose to turn it into a bank.
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