Morgan Stanley has agreed to pay $62.95 million to resolve claims over the sale of toxic mortgage-backed securities to three banks that later failed, the Federal Deposit Insurance Corp said on Tuesday.

The settlement resolves lawsuits the U.S. regulator filed as receiver for the three failed banks against Morgan Stanley and other defendants over what the FDIC said were misrepresentations in the offering documents for the mortgage-backed securities.

The FDIC said the settlement funds will be distributed among the receiverships for the three failed banks: Colonial Bank of Montgomery, Alabama; Security Savings Bank of Henderson, Nevada; and United Western Bank of Denver.