BERN, June 6 (Reuters) - UBS will find it more

expensive to expand abroad as a result of new government

proposals to make the Swiss finance sector more resilient, Swiss

Finance Minister Karin Keller-Sutter said on Friday.

Under the proposals, which could make UBS hold up to $26

billion in core capital, big banks will have to fully capitalise

their foreign units.

"I don't believe that the competitiveness will be impaired,

but it is true that growth abroad will become more expensive."

said Keller-Sutter told reporters in Bern.

Still, banks would become more stable as a result and more

attractive in areas like asset management, she said.