DNB Bank ASA

Earnings Release • Jan 23, 2023

DNB will report a total tax expense of about NOK 460 million for the fourth quarter 2022

DNB will report a total tax expense of about NOK 460 million for the fourth quarter 2022

The low tax expense is mainly a result of the liquidation of the subsidiary in

Asia in the fourth quarter. DNB hedges investments in foreign subsidiaries to

eliminate the foreign currency exposure which arises when the functional

currency differs from that of the Group. Gains or losses on investments in

foreign subsidiaries are exempt from tax while corresponding gains or losses on

hedging instruments are taxable. When a foreign operation is disposed of or

liquidated, the cumulative gains or losses of the hedging instruments recognised

in equity is reclassified to the ordinary income statement. The result from tax

on gains on these hedging instruments amounts to NOK 1 284 million for the

fourth quarter.

This gives an effective tax rate for 2022 of 18 per cent but will have no effect

on the tax guiding going forward (23 per cent).