Note 13 – Pensions

The Company is required to have an occupational pension scheme in accordance with Norwegian law on required occupational pensions (“lov om obligatorisk tjenestepensjon”) for the employees in DHT Management AS. The company’s pension scheme satisfies the requirements of this law and comprises a closed defined benefit scheme. At the end of the year, there were 12 participants in the benefit plan.

Defined benefit pension

The Company established a defined benefit plan for qualifying employees in 2010. Under the plan, the employees, from age 67, are entitled to 70% of their base salary at retirement date. Parts of the pension are covered by payments from the National Insurance Scheme in Norway. The defined benefit plan is insured through an insurance company.

Calculation of this year’s pension costs:

(Dollars in thousands)
Calculation of this year’s pension costs:	2019		2018		2017
Current service cost		406		403		329
Financial costs		14		10		6
Pension costs for the year		420		413		335

The amounts recognized in the statement of financial position at the reporting date are as follows:

	2019			2018		2017
Present value of the defined benefit obligation		2,494			1,971		1,481
Fair value of plan assets		1,788			1,614		1,266
Net pension obligation		707			357		215
Remeasurement loss/(gain)		(287	)		182		211
Net balance sheet recorded pension liability December 31		420			539		425


Change in gross pension obligation:
Gross obligation January 1	2,090		1,708		1,111
Current service cost	401		398		325
Interest charge on pension liabilities	54		42		31
Past service cost - curtailment/plan amendment	-		-		-
Settlement (gain)	-		-		-
Social security expenses	(31	)	(57	)	(44	)
Remeasurements loss/(gain)	(1,055	)	119		227
Exchange rate differences	(21	)	(119	)	58
Gross pension obligation December 31	1,439		2,090		1,708


Change in gross pension assets:
Fair value plan asset January 1	1,551		1,282		886
Interest income	36		27		20
Settlement	-		-		-
Employer contribution	216		404		313
Remeasurements (loss)/gain	(768	)	(63	)	16
Exchange rate differences	(16	)	(99	)	47
Fair value plan assets December 31	1,019		1,551		1,282

The Company expects to contribute $228 thousand to its defined benefit pension plan in 2020.

Assumptions	2019			2018			2017
Discount rate		2.30	%		2.60	%		2.40	%
Yield on pension assets		2.30	%		2.60	%		2.40	%
Wage growth		2.25	%		2.75	%		2.50	%
G regulation*		2.00	%		2.50	%		2.25	%
Pension adjustment		0.50	%		0.80	%		0.50	%
Average remaining service period		19			18			18

*Increase of social security base amount (“G”) as per Norwegian regulations.