UPDATE 1-Swiss seek solution to German bank data spat

* Swiss won't help states if they use stolen data

* Merz says hope to clinch new tax deal with Berlin in March

* Germany prepared to pay for Swiss bank account data

* Netherlands, Belgian add to pressure

(Adds details)

By Jason Rhodes

BERNE, Feb 3 (Reuters) - Switzerland said on Wednesday it would not help Germany hunt tax cheats on the basis of stolen Swiss bank data but hoped to finalise a new tax deal with Berlin by the end of March.

Germany has said it is prepared to pay an informant for data on clients of Swiss banks who may have been using secret accounts to evade German taxes, a new blow to Switzerland's massive private banking industry. [ID:nLDE6101VZ]

"Germany is Switzerland's most important trade partner.... With this in mind, the Federal Council wishes to resolve the problem of the stolen data which has been offered for sale to the German authorities," the government said in a statement.

"It wants to pursue talks with Germany. Nonetheless, it will not provide administrative assistance based on stolen data, even to Germany."

Switzerland moved to calm the sharply escalating row with its northern neighbour a day after the Swiss banking lobby said Berlin was acting as a receiver of stolen goods.

Swiss Finance Minister Hans-Rudolf Merz told a news conference he hoped talks with Germany on a new tax deal to help Berlin catch tax evaders in Switzerland would be wrapped up by the end of March.

Germany had already paid for stolen data in 2008 when it purchased information stolen from Liechtenstein's top bank LGT, forcing the tiny principality to give up bank secrecy rules.

Other European governments are piling pressure on Switzerland and its treasured bank secrecy laws, with Belgium, the Netherlands and Austria all reported to be seeking copies of stolen Swiss bank data from the German government.

This comes just months after France, another key market for Swiss private banks, announced it had obtained sensitive data belonging to potential tax evaders, some of which belonged to the Swiss operations of HSBC (HSBA.L).

Switzerland and France settled the row over the stolen bank records last week after Berne threatened in December to freeze talks on a new treaty aimed at helping Paris catch tax cheats. [ID:nLDE60Q2P0]

Last year Switzerland agreed to relax its strict rules on client privacy to fend off potential sanctions by the G20 group of leading nations, after a clampdown led by Germany and the United States in a bid to recoup potential tax revenues.

UBS (UBS.N) (UBSN.VX), Switzerland's biggest wealth manager, settled with the U.S. tax authorities in August by agreeing to share data on 4,450 clients.

But that deal, considered crucial to UBS's business in the United States, is in question after a Swiss court ruled last month that most of the data cannot be released.

The threat of German tax authorities getting their hands on the stolen data has caused a fresh stir among some clients of Swiss asset managers, worried their accounts could be implicated in the latest tax affair. [ID:nLDE6110ZM] (Editing by Philippa Fletcher)