Orange National Bank in Orange posted record net income of $1.05 million in 1987, a 6.9% increase over $982,000 in the previous year. Total income for the year rose $10.95 million from $9.7 million in 1986. For the fourth quarter, the bank reported a 10% decline in net income to $296,000 in 1987 from $329,000 in the previous year's final quarter. Total quarterly income rose 11.5% to $2.9 million last year from $2.6 million the previous year. The bank's assets fell 4% to $125 million at the end of December from $130.4 million a year earlier, and its deposits fell 7% to $113 million from $121.6 million. But Wayne F. Miller, the bank's president, said Orange National was one of a number of banks that experienced inflated deposit and asset figures in 1986 as investors, taking advantage of the last full year of lower capital gains taxes, sold real estate and other holdings and put their funds into the bank on the last few days of the year and kept it in for about a week. Using average daily figures for the fourth quarter of 1986 would mean Orange National had $111.9 million in assets and $102.7 million in deposits that year, giving the bank an 11.3% increase in assets and a 10% increase in deposits at the end of 1987, Miller said. Total loans increased 11.3% to $85.4 million at the end of December from $76.7 million a year earlier.