UPDATE 1-D.Postbank has two-digit mln euro subprime exposure

(Adds background, forecasts)

FRANKFURT Aug 23 (Reuters) - Deutsche Postbank's (DPBGn.DE) total exposure to the U.S. subprime mortgage market is in the low tens of millions of euros, its chief executive said on Wednesday in remarks embargoed for Thursday.

Postbank had investments in the U.S. market for risky mortgage loans through two funds belonging to stricken lender IKB IKBG.DE.

CEO Wolfgang Klein called for calm against a background of nervous global financial markets.

"I can only appeal to everyone to handle the issue with a cool head," Klein told journalists in London.

There is no credit crunch, but rather a shortage of liquidity, he said.

Earlier in the week, the chief executive of state-backed bank WestLB [WDLG.UL] said German banks faced a critical situation because foreign banks were becoming wary of lending to their German partners.

Klein said he was looking at all options for the bank's fund management business as it was unacceptable always to be at the bottom end of the fund rankings.

The CEO also reiterated the bank's forecasts for a full-year pretax return on equity of more than 20 percent and a cost-income-ratio of less than 63 percent.