To end investigations by state and federal regulators, UBS AG agreed Friday to buy back $18.6 billion of auction-rate securities.

The Swiss company will buy back $8.3 billion from individual investors and charities in a two-year period starting Jan. 1. Beginning in June 2010, it will purchase $10.3 billion held by institutional clients.

The company will pay $150 million of civil penalties — $75 million to New York and $75 million to members of the North American Securities Administrators Association.

UBS did not admit or deny wrongdoing. Last month it announced that it would repurchase $3.5 billion of tax-exempt auction preferred stock. The latest agreement was announced at a press conference Friday with New York Attorney General Andrew Cuomo and officials from the Securities and Exchange Commission and the NASAA.

Citigroup Inc. and Merrill Lynch & Co. Inc. announced plans last week to buy back billions of dollars of auction-rate securities from their retail clients.

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