Danske Bank, announced it was reducing its full-year net profit expectation, due to rapidly rising interest rates and unfavorable market conditions.

Previously having predicted net profits would fall around 13-15 billion crowns, it revised that downward to 10-12 billion crowns (about US$1.64 billion).

Chief Executive Officer Carsten Egeriis said in a press release, “… we revise our net profit guidance for the year based on significantly lower expectations for trading income and income from our insurance business.”

The bank also revised cost guidance to roughly 25.5 billion crowns. One crown is equal to about 14 US cents.

In April, reported first quarter profits had failed to meet expectations. At the time the bank cited higher costs and turbulent financial conditions.

A multinational banking and financial services company headquartered in Copenhagen, Danske Bank is the largest bank in Denmark, and a major retail bank serving over 5 million customers throughout the northern European region. It was ranked number 454 on the Fortune Global 500 list in 2011.

Banks tend to be closely watched during financial downturns, as they will typically invest customer deposits to generate returns. Although the percentage of customer deposits they are allowed to invest is limited, as are the types of investments, if their investments decline sufficiently in value, that can cause financial strains on the banks.