LONDON (Dow Jones) - Germany's two-largest financial companies, Allianz AG and Deutsche Bank AG, each trumpeted market conditions for posting better-than- forecast profit growth during the first quarter.

The bigger of the two firms, insurer Allianz (AZ), said first-quarter profit rose 38% to 1.8 billion euros ( $2.3 billion ), with operating profit jumping 42% to 2.7 billion euros .

Analysts polled by AFX News were looking for a profit of 1.27 billion euros .

Allianz didn't go into much detail - it's saving further details for next week - but it said with benign capital markets, it's already made a "major portion" in the first quarter of the capital gains target it set for all of 2006.

Its Dresdner Bank division and parts of the life insurance business have benefited from the positive environment, and Allianz also benefited from a lack of significant catastrophe claims during the quarter.

But its profit target for the year, of 4.9 billion euros, means that Allianz isn't projecting first-quarter strength to the rest of the year.

At Deutsche Bank (DB), first-quarter profit jumped 55% to 1.7 billion euros after a record quarter for sales and trading.

Revenue rose 21% to 8 billion euros, with debt sales and trading revenue up 19% to 2.8 billion euros , and equity sales and trading revenue up 90% to 1.6 billion euros .

Analysts polled by AFX News were expecting a profit of 1.36 billion euros on revenue of 7.16 billion euros .

Provisions for credit losses fell to 4 million euros from 81 million euros on a series of successful workouts in the corporate and investment bank business.

Deutsche Bank, like Allianz , is more cautious for the rest of the year, projecting double-digit earnings growth.

In early Frankfurt trade, Deutsche Bank shares rose 1.4% and Allianz added 0.7%. (END) Dow Jones Newswires 05-03-06 0432ET Copyright (c) 2006 Dow Jones & Company, Inc.