Downey Plummets Ahead of Weekend

Shares of Downey Financial(DSL - Cramer's Take - Stockpickr) plummeted as much as 25% Friday, as the battered savings and loan gave back some gains made during its three-day rise.

After hitting a 52-week low of $1.06 on Monday, the Newport Beach, Calif.-based thrift's shares climbed 266% through the close Thursday, amid a broader market rally. While the market was relatively flat Friday, Downey shares recently were down 23.2% to $2.98.

There was not much company-specific news to explain the stock's rise or fall, but Downey has been closely scrutinized by investors in recent months, particularly after IndyMac Bancorp was taken over by federal regulators last Friday. In the days leading up to IndyMac's failure, TheStreet.com explored the possibility the bank was going under and what that might portend for other S&Ls.

A company representative on Thursday said Downey had not yet set a date to release its second quarter financial results. A call to CFO Brian Côté on Friday was not immediately returned.

After IndyMac's failure last Friday, Downey responded after the market close on Monday with a press release stating that the regulatory capital ratio of its main subsidiary, Downey Savings & Loan Association was "enhanced by $62 million prior to the end of the second quarter." Capital was increased via a $50 million contribution from the holding company, along with a $12 million dividend paid up from the S&L's real estate subsidiary.

The press release went on to say that Downey S&L's core capital ratio, or leverage ratio, was estimated to be 7.5% as of June 30, with a risk-based capital ratio of 14.3%. These ratios were 8.43% and 15.28% as of March 31.