WASHINGTON, July 18, 2008 (AFP) - An official of the Swiss bank UBS announced Thursday that it was halting its offshore banking services for US citizens after it came under scathing criticism for facilitating massive tax evasion.

The official, Mark Branson, UBS' chief financial officer of global wealth management, also said the bank is cooperating with the US government to identify US clients who might have committed tax fraud.

Branson told the Senate Permanent Subcommittee of Investigation that the bank 'genuinely regrets' failures in complying with US regulations and will stop offering offshore banking to Americans.

'We have decided to exit entirely the business in question,' Branson told the panel of senators.

'That means UBS will no longer provide offshore banking and securities services to US residents through its bank branches. Such services will only be provided to residents of this country through companies licensed in the United States,' he said.

In addition, he added, 'we are working with the US government to identify the names of US clients who may have engaged in tax fraud.'

Branson said client identity is usually protected under Swiss law, but not when a foreign government formally request the information for a tax fraud investigation.

'We will fully support and assist that process,' he said.

Branson was speaking at the committee's inquiry into wealthy American's use of foreign tax havens to evade taxes that is costing the country an estimated 100 billion in lost income, according to the senators.