This was driven by two key factors. The first was a deficit of £24.9m (2014: £2.9m), principally caused by the timing delay between set-up costs (or scope change) incurred during the year of £30m for consumer credit activities, and the recovery of those costs over a ten year period from 2016/17. This loss was anticipated due to the FCA’s chosen strategy for recovering such costs from its fee payers.
The FCA also saw an actuarial loss of £33.4m (2014: £26.4m) in respect of the defined benefit pension scheme. The increase in the actuarial loss was due mainly to the discount rate decrease from 4.40% to 3.40% over the year. The consolidated loss of £69.8m includes £11.5m of PSR set-up costs which will be recovered in 2015/16.
The report also confirmed that penalties of £1.417bn were received in 2014/15, compared to £432.1m in 2013/14.
Last month, the FCA confirmed that it will raise fees in 2015/16 by £7m, or 10.2%.
Firms in the A13 block, primarily mortgage brokers and general insurance advisers, will pay £74.9m in 2015/16, up from £68m in the previous year.
The regulator stressed that fewer than 3,000 advisory firms pay more than the minimum fee, contributing a total of £7.2m, or around 9.6% of the total amount levied.
Although smaller firms will pay the minimum fee only, this is set to increase from £1,000 to £1,084 - the first increase since 2010.
The industry has since criticised FCA chief executive Martin Wheatley for taking his £92,000 annual bonus, pushing his total pay to £701,000 - a 15% yearly increase.
