Looking back three years ago finds Lake Michigan Credit Union taking the first step toward becoming a mutual bank.

In its letter to the members and in a prepared press statement, the credit union cited rapid growth and capital limitation as the two biggest challenges that have led it to consider taking this step. Becoming a bank would help it expand its base of depositors and borrowers and offer more products and services, the credit union said.

“Lake Michigan Credit Union has been successful to the point that the organization has developed up to the parameters of our current charter,” said Sandra Jelinski, president/CEO of Lake Michigan in a press release.

Many in credit union land questioned the move and expressed that there may be other options available to the credit union besides becoming a bank.

CUNA Chief Economist Bill Hampel noted that while the credit union’s financial reports made it appear to be a “poster child” for ongoing capital problems, he nonetheless also explained that the problems related to growth would likely moderate.

“It seems unlikely that the credit union would keep growing at these rates,” Hampel said. “It’s possible, but maybe unlikely.”

With a still strong, but more moderate, growth rate, the pressure on the credit union’s capital ratios would drop, Hampel explained.