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Morgan Stanley announced on Friday it would take a $1.25 billion hit in its fourth-quarter earnings because of a cut in the corporate tax rate as part of the U.S. tax code overhaul, according to a report in Fox Business.

According to official documents, the bank will lose roughly “$1.4 billion net discrete tax provision, mainly due to the remeasurement of certain net deferred tax assets using the lowered corporate tax rate,” but this loss “would be offset by $160 million in other positive effects.”

The sweeping tax code changes, which were enacted in late December, slashes the corporate tax rate — from 35 percent to 21 percent. The measure was expected to bring short-term pain, but long-term gain for U.S.-based corporations.

According to the Fox report, many large companies, including big banks like Citigroup and JPMorgan Chase & Co, have squirreled away an estimated $2.8 trillion overseas in recent years.

The Joint Committee on Taxation (JCT), a nonpartisan research arm of the U.S. Congress, predicted that the one-time tax on those earnings is expected to raise $339 billion in federal revenues over the coming decade.

Goldman Sachs Group Inc said on Dec. 29 that it expects its fourth-quarter earnings to decrease by about $5 billion due to the repatriation tax, which imposes a tariff on moving money from foreign countries to the U.S., Goldman said in a filing.

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