Vote-Count Commences On Lake Michigan CUConversion

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GRAND RAPIDS, Mich. - (12/09/04) -- About two-dozen members of LakeMichigan CU, most of them critics, peppered management about theneed to convert to a mutual savings bank during Wednesday's specialmeeting, culminating a 30-day ballot on the conversion bid. "Ifthis goes through I will be done with them," Sandi Mojzuk, a memberfrom nearby Rockford, told The Credit Union Journal, aftermanagement told her she could not withdraw her CDs without penaltyif the conversion is approved. Sandy Jelinski, president of the$1.1 billion credit union, said they had to undergo the conversionin order to raise capital. "If we remain a credit union, with thecapital we have, we'll have to lower deposit rates and raise loanrates because we won't have any money to lend," she told about 160attendees to the special meeting. Credit union auditor Cindrich,Mihalak & Co. will start counting Thursday morning the morethan 37,000 ballots mailed in by Lake Michigan CU members to see ifthe conversion proposal garnered the necessary two-thirds vote.State regulators with the Office of Financial and InsuranceServices will post a monitor to watch the vote count, which isexpected to take as long as a week. If the conversion is approved,the credit union expects to commence a public offering of stock toraise as much as $70 million to finance expansion plans. Jelinskisaid the credit union has spent about $700,000 on the conversionprocess so far, including $500,000 to print, mail and handle threeseparate disclosures and 80,000 ballots.

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