ZURICH (Reuters) -UBS may be able to carry out fewer share buy-backs in future following proposals that it should hold higher levels of core capital, the Swiss government said on Friday.

The government proposed higher capital requirements for the lender's foreign units as part of wide-ranging new rules for UBS aimed at making Switzerland's financial centre more robust in the wake of the collapse of Credit Suisse in 2023.

Dividend payments and organic growth should still be possible, subject to "appropriate transitions periods and provided profits have been generated," the government said.

"The measure could mean that UBS will temporarily implement fewer share buybacks and reports a slightly lower return on equity along with lower risks," the government said in a statement.

UBS Chairman Colm Kelleher in April reiterated the Swiss bank's intention to repurchase shares to the tune of $3 billion in 2025, despite the looming capital rule changes and global economic uncertainty.

The growth of foreign subsidiaries or acquisition of foreign companies by UBS will still be possible, but will become more expensive because it has to be fully financed by the core capital, the government added.

"The measure can therefore make foreign growth in subsidiaries more expensive," it added.