UBS has confirmed that the US government has reached an out of court settlement with Switzerland over the IRS' request that the Zurich-based bank hand over the names of US taxpayers who may have used secret Swiss bank accounts to evade US taxes.

"Today, the US government informed the US District Court of the Southern District of Florida that all parties have reached an agreement to resolve the John Doe summons matter and that they have initialled the final documentation," UBS said in a statement.

"The hearing scheduled for 17 August will be removed from the court's calendar, and immediately after the formal signing has occurred, the parties will file the agreed upon stipulation of dismissal with the court," it continued.

UBS chairman Kaspar Villiger said: "The board of directors and management of UBS are grateful that the two governments reached this agreement to resolve this issue, and we thank the Swiss government and the Swiss delegation that negotiated this settlement for their outstanding efforts."

Last winter the IRS asked district court judge Alan Gold to order UBS to provide it with information on thousands of US taxpayers with Swiss bank accounts. The Swiss government got involved shortly afterwards because it viewed the fulfillment of such a request as a violation of the traditions and laws of Swiss banking.

Originally the US was thought to want details on as many as 52,000 names, according to media reports. Subsequent reports have suggested a much lower number - without, however, hazarding a new guess as to the number of names sought.

Though court proceedings have been stopped in lieu of the agreement between the US and Switzerland, IRS commissioner Doug Shulman emphasizes that the deal -though final in its form - has yet to be ratified.

"We are pleased to have initialled an agreement with the Swiss government which protects the United States government's interests," Mr Shulman said. "We will release more details when the Swiss government signs the agreement as early as next week."

The Swiss government has confirmed that it has reached an agreement on disclosing the identity of US taxpayers with Swiss bank accounts.

Last winter UBS admitted to having helped a couple of hundred US clients evade taxes and agreed to pay the US $780 million in fines related to the matter. To date, however, UBS has maintained that it is under no obligation to give US authorities - specifically the IRS - information on those of its US clients with Switzerland-based accounts.

With the recently added retail-brokerage might of Merrill Lynch, Bank of America has supplanted UBS as the world's largest wealth management firm, according to rankings provided by Scorpio Partnership, a London-based consultancy to the private banking industry.

Wendy Spires and Knud Noelle in London contributed to this report.