The Federal Deposit Insurance Corp. (FDIC) hopes to sell a MBS collateralized by at least $500 million of performing residential whole loans by the end of this month through a private placement deal, investment banking sources told National Mortgage News.

The agency hopes this could be the first of many MBS offerings, depending on how well it's received in the market. The exact size of the private security could be just under $1 billion, one source said.

"These are all performing loans that are not subject to loss-sharing agreements. All different collateral types are involved," he added.

Bidder information on the private security is currently being shown to investors and July 28 is being discussed as the final settlement date.

An FDIC spokesman said he could not provide any details and would only say that the agency has "a bunch of loans" that it is looking to securitize.

Over the past several months, the FDIC has backed away from offering generous loss-sharing arrangements on mortgages when it sells failed banks to investors.

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