July 23, 1984

MONDAY, JULY 23, 1984 Companies Continental Illinois released an internal report that said there was a ''breakdown'' in its lending controls in the early 1980's. The bank's board is to hold its regular monthly meeting today, but may not reach agreement on a proposed rescue package. (Page D1.)

ANDERSON, Ind. Were it possible to ignore the past, he would have appeared to be just another talented, young quarterback, working hard in training camp, trying to remain as a member of the 1984 Indianapolis Colts. Play after play, he dropped back quickly, set up smoothly and fired tight spirals that generally reached the receiver at the precise time and place downfield. Yet just as Art Schlichter could not escape the admiring glances of coaches and scores of fans beside the field at the Colts' training headquarters at Anderson College, he cannot escape the pain of his past, a problem with gambling that left him out of football and worried that he might never again be allowed to play in the National Football League.

Corporate profits in the second quarter rose less robustly than in the first quarter, offering a new sign that the economy was expanding at a less- frenzied pace. But, based on the initial wave of second-quarter results and what analysts expect of those to come, profits were still stronger than at this stage of earlier recoveries. Many economists expect the Commerce Department's revised estimate of economic growth in the April- June period, to be released today, to exceed the initial ''flash'' estimate of a 5.7 increase. First-quarter growth is put at 9.7 percent.

Congress will reconvene Monday for a three- week session between the Democratic and the Republican national conventions facing an array of unfinished business, including an overhaul of the immigration laws and military aid to Central America. Before it recessed for the Democratic convention, Congress achieved an unexpected degree of bipartisanship on major legislative initiatives. The question now is whether bipartisan compromises will continue or whether the political pressures of an election year will make further legislative progress this year impossible. There is little optimism that the immigration and the military budget measures leading the work list can be completed before the recess for the Republican National Convention. Congress will return after Labor Day and is scheduled to adjourn Oct. 4 to let its members campaign for re-election.

Many consumers will benefit from lower-priced prescriptions in the next few years as the pharmaceutical industry undergoes a fundamental change. Some of the industry's most profitable drugs will lose their patent protection, opening the way to competition from cheaper generic copies. The American Home Products Corporation's heart drug Inderal, which had sales of $335 million last year, will lose its patent protection in September. Inderal's generic name is propranolol hydrochloride.