Downey Financial 8-K Regulation FD Disclosure

Table of Contents

EXHIBIT 99.1

DOWNEY FINANCIAL CORP.
N E W S   R E L E A S E	For further information contact: Thomas E. Prince Chief Operating Officer and Chief Financial Officer (949)509-4440

DOWNEY FINANCIAL CORP. ANNOUNCES THIRTEEN
MONTH SELECTED FINANCIAL DATA

          Newport Beach, California—December 15, 2004—Downey Financial Corp. (NYSE: DSL) today released monthly selected financial data for the thirteen months ended November 30, 2004.

          During November, the following transactions occurred, which we previously disclosed:

• We sold approximately $1 billion of our residential one-to-four unit loans on a servicing released basis from our held for investment portfolio. These loans were transferred to held for sale in October.
• Of the previously announced sale of 80% of our mortgage servicing rights related to loans we service for others, we sold approximately two-thirds of the portfolio with the remaining sales expected to close in December.

          Downey Financial Corp. is the parent company of Downey Savings and Loan Association, F.A., with assets of $15.2 billion and 165 branches throughout California and four in Arizona.

          Certain statements in this release may constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. Forward-looking statements do not relate strictly to historical information or current facts. Some forward-looking statements may be identified by use of terms such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may." Downey’s actual results may differ significantly from the results discussed in such forward-looking statements. Factors that might cause such a difference include, but are not limited to, economic conditions, competition in the geographic and business areas in which Downey conducts its operations, fluctuations in interest rates, credit quality and government regulation. Downey does not update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements were made.

Table of Contents

DOWNEY FINANCIAL CORP. AND SUBSIDIARIES
Monthly Selected Financial Data (Unaudited)

			Nov. 30,			Oct. 31,			Sep. 30,			Aug. 31,			Jul. 31,			Jun. 30,			May 31,			Apr. 30,			Mar. 31,			Feb. 29,			Jan. 31,			Dec. 31,			Nov. 30,
(Dollars in Thousands)			2004			2004			2004			2004			2004			2004			2004			2004			2004			2004			2004			2003			2003
Balance sheet summary
Total assets			$15,203,688			$15,875,054			$15,639,464			$15,230,593			$14,722,398			$14,222,347			$13,469,747			$13,279,872			$13,525,129			$12,028,524			$11,760,289			$11,645,980			$11,348,579
Loans receivable held for investment			12,845,864			12,661,820			13,411,146			12,935,889			12,517,148			12,309,935			11,953,295			11,501,984			11,064,686			10,609,898			10,389,725			10,116,519			9,754,117
Loans held for sale, at lower of cost or fair value			1,234,751			1,977,140			845,913			859,695			893,939			661,481			268,018			473,621			529,085			350,909			196,231			279,657			316,517
MBS available for sale, at fair value			311			313			315			317			319			321			323			325			327			329			331			334			1,264
Cash, investment securities and FHLB stock			842,832			788,124			1,048,979			1,127,900			990,002			924,943			912,531			968,300			1,114,585			751,800			856,312			926,603			953,209
Deposits			9,693,558			9,684,261			9,551,333			9,453,724			9,265,419			8,948,238			8,873,389			8,925,205			8,817,173			8,574,472			8,378,974			8,293,758			8,388,866
FHLB advances and other borrowings			4,012,823			4,698,051			4,670,604			4,274,277			4,069,379			3,795,775			3,346,798			3,088,420			2,935,401			2,231,099			2,162,305			2,129,311			1,706,917
Senior notes			197,911			197,898			197,886			197,873			197,937			198,179			-			-			-			-			-			-			-
Junior subordinated debentures (a)			-			-			-			-			-			123,711			123,711			123,711			123,711			123,711			123,711			123,711			123,711
Non-performing assets as a % of total assets			0.26	%		0.24	%		0.25	%		0.26	%		0.26	%		0.28	%		0.33	%		0.35	%		0.40	%		0.48	%		0.42	%		0.42	%		0.49	%
Loan activity for the month ended
Loans for investment portfolio:
	Originations and purchases:
		Residential one-to-four units	$ 413,452			$ 488,268			$ 704,104			$ 649,596			$ 486,924			$ 668,376			$ 770,690			$ 745,995			$ 738,829			$ 460,152			$ 531,489			$ 660,303			$ 382,889
		Residential one-to-four units – subprime	65,761			74,821			80,264			80,449			71,535			85,820			55,114			63,754			72,110			46,609			53,826			62,773			31,879
		All other	42,745			42,445			49,791			56,844			55,434			64,721			82,060			53,236			51,896			28,401			45,094			59,420			34,692
	Repayments		(338,681		)	(372,449		)	(360,602		)	(359,596		)	(403,109		)	(456,983		)	(422,795		)	(414,562		)	(396,939		)	(317,712		)	(349,642		)	(403,098		)	(336,092		)
Loans for sale:
	Originations and purchases		921,366			839,470			595,990			690,118			768,524			638,047			227,134			414,027			452,967			315,943			158,867			267,608			263,787
	Sales		(1,641,107		)	(699,849		)	(607,335		)	(726,306		)	(537,585		)	(245,405		)	(433,859		)	(459,765		)	(274,641		)	(161,512		)	(242,593		)	(302,077		)	(322,390		)
Mortgage loans serviced for others
Total			$12,440,154			$11,038,703			$10,568,339			$10,169,574			$9,635,124			$9,279,359			$9,269,270			$9,141,600			$9,167,834			$9,276,207			$9,353,202			$9,313,948			$9,241,228
With capitalized mortgage servicing rights:(b)
	Amount		3,320,091			9,924,548			10,075,028			10,130,863			9,595,335			9,242,641			9,225,547			9,096,452			9,126,444			9,226,052			9,302,028			9,268,308			9,193,686
	Weighted average interest rate		5.26	%		5.52	%		5.52	%		5.43	%		5.50	%		5.61	%		5.63	%		5.68	%		5.73	%		5.76	%		5.77	%		5.79	%		5.81	%
Interest rate spread data (c)
Weighted average yield:
	Loans and MBS		4.64	%		4.54	%		4.46	%		4.43	%		4.41	%		4.37	%		4.43	%		4.43	%		4.51	%		4.56	%		4.60	%		4.61	%		4.75	%
	Investment securities and FHLB stock		3.79			3.86			3.94			3.88			3.80			3.78			3.61			3.64			3.50			3.20			3.19			3.19			3.14
		Interest-earning assets yield	4.59			4.51			4.43			4.39			4.37			4.34			4.39			4.38			4.43			4.49			4.50			4.51			4.63
Weighted average cost:
	Deposits		1.83			1.81			1.80			1.77			1.72			1.65			1.57			1.55			1.56			1.56			1.54			1.52			1.57
	FHLB advances and other borrowings(d)		2.63			2.38			2.28			2.16			2.07			1.97			1.95			2.09			2.11			2.98			3.04			3.08			3.56
	Senior notes		6.50			6.50			6.50			6.50			6.50			6.50			-			-			-			-			-			-			-
	Junior subordinated debentures (a)		-			-			-			-			-			10.00			10.00			10.00			10.00			10.00			10.00			10.00			10.00
		Combined funds cost	2.13			2.06			2.02			1.96			1.89			1.90			1.76			1.77			1.78			1.94			1.94			1.94			2.01
Interest rate spread			2.46	%		2.45	%		2.41	%		2.43	%		2.48	%		2.44	%		2.63	%		2.61	%		2.65	%		2.55	%		2.56	%		2.57	%		2.62	%

(a)  On July 23, 2004, we redeemed the junior subordinated debentures before their maturity.
(b)  Excludes loans sold or securitized prior to 1996 and loans sub-serviced without capitalized mortgage servicing rights.
(c)  Reflects month end contractual yields and costs and excludes adjustments for non-accrual loans, net deferred costs to originate loans and the amortization of premiums and discounts.
(d)  Included since March 2004 is the impact of permitted interest rate swap hedges against a portion of our FHLB advances. The swap notional amounts total $430 million of receive-fixed, pay-3-month Libor variable interest.