(CN) - The Financial Regulatory Authority lost $84 million because of reduced regulatory fees and lower investment returns, according to its 2011 financial report.
The regulator stated that it had been hampered by a stuttering economic recovery. Revenues from regulatory fees were down by roughly $50 million - a 10 percent decline in comparison to 2008, according to the report.
Revenues from 2011 hit $880.1 million, a $30.2 million increase from 2010. Total expenses, however, increased to $994.9 million - a $54 million increase.
"In light of our robust regulatory responsibilities but static funding levels, we have taken a hard look at spending across FINRA to be sure we are operating as effectively and efficiently as possible," the report states.
The regulator said that it planned to cut its operating budget by $35 million this year, with cumulative savings of $60 million by the end of the next. That will be achieved without compromising FINRA's "regulatory mission," the report says.
The cost of regulating the industry would still eclipse revenues, the reports states. But the regulator says it is working with the SEC to "identify new revenue opportunities," and raising fees to brokerage firm members to meet its regulatory obligations.
Executive pay was also trimmed, albeit modestly. CEO Richard Ketchum has a $2.25 million salary for 2012, compared to roughly $2.7 million in 2011. Ketchum's 2011 salary included a $1.2 million bonus from 2010. Vice chairman Stephen Luparello will earn $1.29 million in 2012, compared to $1.38 million in 2011.