Newport Beach-based savings and loan operator Downey Financial Corp. saw a big surge in fourth-quarter profit, thanks to lower taxes and interest from loans.
Net income for the quarter nearly doubled from a year earlier to $46.4 million.
Downey sold off a big chunk of loans it managed for others in the quarter, Chief Executive Daniel D. Rosenthal said.
“Those sales are expected to reduce our earnings volatility, since the amount of mortgage servicing rights we now own is significantly lower,” he said.
Downey made a record number of loans itself in 2004. In the fourth quarter, net interest income from loans was $90 million, up 38% from a year earlier. Interest-earning assets averaged $15.3 billion in the quarter, up 41% from a year earlier.
As of Dec. 31, Downey’s total assets were $15.6 billion, up $4 billion or 34% from a year earlier.
Deposits totaled $9.7 billion at Dec. 31, up $1.4 billion or 16% from a year earlier.
Last year, Downey saw a shift in chief executives with Rosenthal returning to the helm after running the thrift from 1998 to early 2004.
Marangal “Marito” Domingo replaced Rosenthal early last year for a seven-month stint.
Downey, which is dominated by founder and Chairman Maurice L. McAlister, was known for going through bosses in the early 1990s. Rosenthal is McAlister’s former former son-in-law.
