The Federal Deposit Insurance Corp. is preparing to sell a large piece of the failed AmTrust Bank's servicing portfolio, investment banking sources said.

The servicing rights, on roughly $20 billion of loans, could hit the market by the end of January.

Before regulators seized it on Dec. 4, AmTrust serviced about $30 billion of loans, most of which have been sold to Fannie Mae and Freddie Mac.

AmTrust was a national correspondent and wholesale lender, concentrating on loans headed for the government-sponsored enterprises.

New York Community Bancorp Inc., which bought most of AmTrust from FDIC (though not the servicing rights), said it plans to keep the failed institution's wholesale mortgage business.

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