FRANKFURT, May 14 (Reuters) - Deutsche Pfandbriefbank

(PBB), one of Germany's top property financiers,

posted a slight rise in first-quarter profit and an increase in

risk provisions as it navigates troubles in the real-estate

industry.

The bank's quarterly profit was 29 million euros ($31.27

million), compared with 27 million a year earlier, while

provisions for loan losses shot up to 47 million euros from 2

million euros last year, it said on Tuesday.

PBB said it would reduce exposure to Britain and the United

States - where it had rapidly expanded at the end of the last

decade - through the disposal of office, home and hotel loans

worth around 900 million euros.

Private equity giant Blackstone is in talks with PBB

to purchase the portfolio, a source familiar with the matter

told Reuters. The discussions were earlier reported by

Bloomberg.

PBB, which earlier this year saw its credit rating cut and

its shares drop sharply as fears of a widening property crisis

in the United States and Europe took hold, said that growth of

non-performing loans was "moderate" and that "capital and

liquidity resources remain at a comfortable level".

"We have generated solid earnings in the first quarter,

weathering an ongoing challenging market environment," said

Chief Executive Kay Wolf.

($1 = 0.9274 euros)