Downey Savings Net for Quarter Down 22%

Downey Savings & Loan Assn., Orange County’s fourth-largest savings institution, posted net income of $12.3 million for the second quarter, down 22% from the year-earlier $15.75 million, despite a one-time gain of $6.9 million from the settlement of a lawsuit.

For the first half, the Costa Mesa-based S&L;’s net income fell more than 35% to $23.8 million from $37.1 million a year earlier.

Gerald H. McQuarrie, Downey’s chief executive officer, said the S&L;’s higher performance last year came largely from gains on loan sales that netted the S&L; nearly $7 million at a time when declining interest rates spurred large numbers of refinancings.