UPDATE 2-Swiss government rules out aid for UBS-paper

(Adds UBS comment)

ZURICH, Feb 7 (Reuters) - Switzerland would not come to the rescue of subprime-stricken bank UBS (UBSN.VX), even if the credit crisis were to hurt its business further, the country's finance minister was quoted as saying.

"I can rule out that UBS would ever get an emergency state guarantee," Hans-Rudolf Merz told the country's Tages-Anzeiger daily newspaper in an interview.

A spokesman for the bank said it was "comfortable" with its present capital base, meeting regulatory requirements even before a planned capital increase which must be approved at an emergency shareholder meeting later this month.

Ahead of the meeting, Merz urged shareholders to approve UBS's plans for a 13 billion Swiss franc ($11.86 billion) capital hike through the sale of shares to Singapore's Government Investment Corporation and an unnamed Middle East investor.

"I welcome the recapitalisation very much ... For the robustness of its business, it is better if (UBS) can raise its capital base as planned by the supervisory board," Merz said.

Small shareholders have urged UBS to open up its capital increase for them through a rights issue, rather than issuing a mandatory convertible to the two new investors.

"It (Singapore's GIC) does not plan to impose new strategies or new structures on UBS," Merz said.

UBS has so far announced $18.4 billion in subprime write-downs, making it Europe's hardest-hit major bank by the credit crisis. It has announced a 4.4 billion franc full-year loss ahead of releasing 2007 results next week. (Reporting by Douwe Miedema, editing by Will Waterman and David Cowell)