THIS CAPITAL  SECURITY IS A GLOBAL  CERTIFICATE  WITHIN THE MEANING OF THE TRUST
AGREEMENT  HEREINAFTER  REFERRED  TO  AND  IS  REGISTERED  IN  THE  NAME  OF THE
DEPOSITORY TRUST COMPANY (THE "DEPOSITORY") OR A NOMINEE OF THE DEPOSITORY. THIS
CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL  SECURITIES  REGISTERED IN THE NAME
OF A PERSON  OTHER  THAN  THE  DEPOSITORY  OR ITS  NOMINEE  ONLY IN THE  LIMITED
CIRCUMSTANCES  DESCRIBED IN THE TRUST  AGREEMENT AND NO TRANSFER OF THIS CAPITAL
SECURITY  (OTHER  THAN A TRANSFER  OF THIS  CAPITAL  SECURITY  AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE  DEPOSITORY OR BY A NOMINEE OF THE  DEPOSITORY TO
THE DEPOSITORY OR ANOTHER  NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY
SUCH  NOMINEE  TO A  SUCCESSOR  DEPOSITORY  OR TO A  NOMINEE  OF SUCH  SUCCESSOR
DEPOSITORY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY (55 WATER STREET,  NEW YORK) TO DOWNEY  FINANCIAL  CAPITAL TRUST I OR
ITS AGENT FOR  REGISTRATION  OF TRANSFER,  EXCHANGE OR PAYMENT,  AND ANY CAPITAL
SECURITY  ISSUED IS  REGISTERED  IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN  AUTHORIZED  REPRESENTATIVE  OF THE  DEPOSITORY  AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL  INASMUCH AS THE  REGISTERED  OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.

CERTIFICATE NUMBER  S-001                NUMBER OF CAPITAL SECURITIES  4,800,000



                              CUSIP NO. 261016 20 8
                                   ----------

                    CERTIFICATE EVIDENCING CAPITAL SECURITIES

                                       OF

                        DOWNEY FINANCIAL CAPITAL TRUST I

                             10% CAPITAL SECURITIES
                  (LIQUIDATION AMOUNT $25 PER CAPITAL SECURITY)

     DOWNEY FINANCIAL  CAPITAL TRUST I, a statutory  business trust formed under
the laws of the State of Delaware (the  "Trust"),  hereby  certifies that Cede &
Co.  (the  "Holder")  is the  registered  owner of Four  Million  Eight  Hundred
Thousand  (4,800,000)  Capital Securities of the Trust representing an undivided
beneficial  interest  in the  assets  of the  Trust and  designated  the  DOWNEY
FINANCIAL  CAPITAL TRUST I 10% Capital  Securities  (liquidation  amount $25 per
Capital  Security)  (the  "Capital  Securities").  The  Capital  Securities  are
transferable  on the  books and  records  of the  Trust,  in person or by a duly
authorized  attorney,  upon surrender of this  certificate  duly endorsed and in
proper form for transfer as provided in Section 5.4 of the Trust  Agreement  (as
defined below). The designations, rights, privileges, restrictions,  preferences
and other terms and  provisions of the Capital  Securities are set forth in, and
this certificate and the Capital Securities






represented  hereby are issued and shall in all respects be subject to the terms
and provisions  of, the Amended and Restated Trust  Agreement of the Trust dated
as of July 23,  1999,  as the same may be amended  from time to time (the "Trust
Agreement")  including the designation of the terms of Capital Securities as set
forth  therein.  Capitalized  or otherwise  defined terms used but not otherwise
defined  herein  shall  have the  respective  meanings  given  them in the Trust
Agreement.  The Holder is  entitled to the  benefits  of the Capital  Securities
Guarantee  Agreement  entered  into by  Downey  Financial  Corp.,  a  California
corporation,  and Wilmington Trust Company,  as guarantee  trustee,  dated as of
July 23,  1999 (the  "Capital  Securities  Guarantee"),  to the extent  provided
therein.  The Trust will furnish a copy of the Trust  Agreement  and the Capital
Securities  Guarantee to the Holder without  charge upon written  request to the
Trust at its principal place of business or registered office.

     Upon  receipt  of this  certificate,  the  Holder  is  bound  by the  Trust
Agreement and is entitled to the benefits thereunder.

     IN WITNESS  WHEREOF,  an  Administrative  Trustee of the Trust has executed
this certificate this 23rd day of July, 1999.




DOWNEY FINANCIAL CAPITAL TRUST I


By:  /s/ Thomas E. Prince
     ----------------------------------------
     Thomas E. Prince, Administrative Trustee





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