BOSTON (Reuters) - Swiss bank UBS (UBSN.VX: Quote, Profile, Research) has agreed to buy back $19.4 billion (10.1 billion pounds) of debt securities whose value collapsed during the global financial crisis, and to pay $150 million in fines to settle charges that it misled investors, a Massachusetts official said on Friday,

The bank's settlement with state and federal regulators in the United States followed an announcement on Thursday that Citigroup (C.N: Quote, Profile, Research) and Merrill Lynch MER.N would buy back almost $20 billion of such securities between them.

"There's been an agreement," said Brian McNiff, a spokesman for Massachusetts Secretary of State William Galvin. "It covers state and federal complaints against them."

The $150 million in fines would be split between Massachusetts and New York, which accused UBS of steering broker clients into so-called auction-rate securities that became impossible to sell when the credit market froze.

The agreement is likely to force UBS, Europe's biggest casualty of the markets turmoil, to make further writedowns on the value of its assets beyond the $37 billion it has already taken.

JP Morgan reckons UBS could face $1 billion in writedowns. Others estimated that such a move could cost UBS $1.8 billion. UBS now has a bill for the securities at face value even though they are worth less.

McNiff said a formal statement on the settlement could be released on Monday.

The U.S. Securities and Exchange Commission declined to comment on the settlement.

The bank has declined to comment beyond saying that it was "consistently working with regulators towards a comprehensive solution for all auction-rate securities investors."