ZURICH, April 2 (Reuters) -

UBS on Tuesday said it was launching a new share

buyback programme of up to $2 billion, with up to half being

completed in 2024.

The scheme will begin on Wednesday, said the Swiss bank

which announced a $1 billion buyback with its annual results in

February.

Now, the volume of shares to be repurchased could be

expanded up to $2 billion in the scheme which will run until

2026.

The scheme follows a 2022 buyback, where UBS bought back

298.5 million of its shares - equivalent to 8.6% of its stock -

for $5.2 billion.

Rather than being canceled as initially intended, most of

the repurchased shares were used in last year's takeover of

Credit Suisse.

Before the deal was announced, UBS had already repurchased

nearly 1.2 billion Swiss francs ($1.32 billion) worth of its

stock.

"As previously communicated, in 2024 we expect to repurchase

up to $1bn of our shares, commencing after the completion of the

merger of UBS AG and Credit Suisse AG which is expected to occur

by the end of the second quarter," the bank said in a statement.

"Our ambition is for share repurchases to exceed our

pre-acquisition level by 2026," it added, pointing to the $5.6

billion of shares repurchased in 2022.

During buybacks, firms buy their own shares on the stock

exchange, reducing the proportion of shares held by investors,

offering a way for companies to return cash to shareholders -

along with dividends, and often sending the stock higher as

shares reduce in number.

If exercised in full, the new share buyback will amount to

around 64.1 million shares - equivalent to roughly 1.85% of

UBS's share capital.

Analysts at Zuercher Kantonalbank were positive about the

announcement.

"We see the launch of a new share buyback programme as the

first step in preparing for the announced buyback of USD 1 bn,

which we believe is likely to begin in Q3," said analyst Michael

Klien in a note.

($1 = 0.9062 Swiss francs)