UPDATE 1-SNB says mkt upswing impact on UBS Stabfund modest

*SNB saw no big benefit as fund valued at amortised cost

*Says value of loan to UBS was $21.5 bln end-Q3

(adds details from statement, background)

ZURICH, Nov 13 (Reuters) - The Swiss National Bank said on Friday a third-quarter market upswing had only a marginal impact on the fund it created to absorb billions of dollars of UBS' (UBSN.VX)(UBS.N) toxic assets and help prop up the bank.

"Since a large part of the portfolio is valued at amortised cost, the improvement of the markets in the third quarter had only a modest impact on the stabilisation fund," the SNB said in a statement on Friday.

The bank also said that the loan extended to UBS was being steadily reduced and amounted to $21.5 billion at the end of September.

The Swiss central bank agreed in October 2008 to help rescue battered Swiss banking giant UBS by offering to buy up to $60 billion of illiquid assets that were weighing on the lender's balance sheet.

The setting up of the so-called stabilisation fund (Stabfund) came in conjunction with a Swiss government cash injection worth 6 billion Swiss francs ($5.91 billion).

UBS had originally planned to transfer assets with some $60 billion in toxic assets to the SNB. This was later reduced to under $40 billion. ($1=1.015 Swiss Franc) (Writing by Lisa Jucca; Editing by Hans Peters)