Beehive To Call It Quits as a CU, But Members Suggest Fat Lady Has Yet To Sing
SALT LAKE CITY -- A majority of members of the $187 Beehive Credit Union who voted in its charter-change balloting voted to leave their credit union charter and become a mutual bank, the credit union has reported on its Web site (www.beehivecredit.com).
"We extend our heartfelt thanks to members who exercised their right to vote and look forward to maximizing convenience and continuing to provide high quality products and services to our members now and into the future," wrote Beehive President Scott Jorgensen on the site. "The charter change will be completed as soon as practicable following the receipt of applicable regulatory approval from the National Credit Union Administration, Office of Thrift Supervision, and Federal Deposit Insurance Corporation."
The CU reported that 36% of the credit union's roughly 22,000 members are eligible to vote, according to Jorgenson's comments a in local media story. They voted 57%-to-43% in favor of the move. Based on the CU's numbers, that meant roughly 4500 members voted for the bank charter.
Teri Dial, a member who helped organize other members against the conversion said in a story in the Salt Lake Tribune that she planned to move her accounts once the conversion takes place, and other members had told her of their plans to do the same. When asked about the possibility of loss of business, Jorgenson was quoted doubting that possibility. "We've acted in the members' best interests" he was quoted as saying.
Dial told Credit Union Times that she attended the Feb. 13 special meeting on the conversion and said while she was impressed by the loyalty of the CU's employees who were out in force at the meeting, she was concerned that so few appeared to have knowledge of the CUs long history or any real understanding of the members' deeper interest in owning the CU.
"Unlike anyone there, other than my brother, I grew up with Beehive. I hold a fondness for Beehive and all that it represents for the people and the community it has served. It would be disingenuous to assume that I would want anything but success for Beehive.
I was impressed with the loyalty of the employees that spoke, only finding it unfortunate that some may have forgotten and others apparently aren't aware that Beehive has been around for over 50 years not just the last five."
She also questioned how Beehive, which had not become one of the larger CUs in the state was going to better help its members as a small bank.
"It's not clear how the 14th largest credit union in the state of Utah can do better for its members as one of the smallest banks. I agree that the Board of Directors may have a plan for this institution, but I disagree that it has anything to do with the future success of Beehive.
"It is unfortunate that the significant investment in capital and community, which took over 50 years and thousands of Utah families to build, will be taken away from those families. I sincerely hope that the employees' loyalty is not misplaced, and that for the sake of those employees and remaining members my concerns are mistaken and this charter change will not progress to a clean sweep of employees under the premise of 'moving in another direction.'"
And there are signs the conversion effort may wind up in a regulatory and legal fight as members opposed to the move appear to be gearing up to challenge the CU's conversion balloting.
The credit union announced on Feb. 21 that a majority of the 36% of eligible members who voted in the contest had cast ballots in favor of the move and that the margin was 57% to 43%.
But in a press release issued the same day, the members said they may file a complaint about the vote with NCUA based on what they said appeared to be ballots sent to former CU members.
"Although Beehive has not released any actual ballot count," the members said, "the figures they supply indicate that if less than 250 votes had switched, a majority of voting members would have voted down the proposal. At the same time, at least 395 who were no longer members of the credit union may have received ballots and voted in the election."
The members investigating the possible complaint declined to comment further on it as of press time. But a review of NCUA's records and the CUs disclosure notice about the conversion appears to reveal a discrepancy between the number of Beehive members that were considered members for balloting purposes and the number of members actually sent ballots. Some members who were counted as members for the purposes of the conversion balloting might have left the credit union but were still sent ballots.
NCUA has declined to comment on questions related to the Beehive balloting.