Fund American Enterprises has shelved its effort to sell its mortgage company, Source One Mortgage Services, and will instead pursue a sale of some $10 billion of servicing rights.

The Norwich, Vt., holding company announced that it had advised its investment banker, Lehman Brothers, to end the six-month effort to sell the mortgage bank. "While we had a number of expressions of interest, the climate does not appear promising" for a sale of the entire unit, said John J. Byrne, chairman of Fund American.

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