First Horizon National Corp. in Memphis expects to be fined up to $11.5 million by federal arbitration panel, in a dispute over its sale of preferred-term securities to First United Corp. in Oakland, Md.
The $25.7 billion-asset First Horizon said in a Monday regulatory filing that it believes a Financial Industry Regulatory Authority arbitration panel had ruled against it, in a dispute with First United Bank & Trust, a unit of the $1.3 billion-asset First United.
First Horizon said it received word about the panel's decision from a discussion with its counsel and that it has not seen a final ruling.
First Horizon said it has not established a liability or reserve for the FINRA arbitration. The company reported a profit of $67.2 million in the third quarter.
First United accused First Horizon's FTN Financial Securities subsidiary of fraud, breach of fiduciary duty, breach of contract and violation of rules concerning suitability and other regulatory standards, stemming from its purchase of preferred-term securities. First United had sought damages of up to $46.5 million.
First Horizon did not say in the filing when the sale of the securities took place. Kim Cherry, a First Horizon spokeswoman, declined to comment. Tonya Sturm, chief financial officer at First United, could not be reached for comment. Ray Pellecchia, a FINRA spokesman, declined to comment.