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This paper presents an efficient algorithm for solving a balanced regularization problem in the frame-based image restoration. The balanced regularization is usually formulated as a minimization problem, involving an l2 data-fidelity term, an l1 regularizer on sparsity of frame coefficients, and a penalty on distance of sparse frame coefficients to the range of the frame operator. In image restoration, the balanced regularization approach bridges the synthesis-based and analysis-based approaches, and balances the fidelity, sparsity, and smoothness of the solution. Our proposed algorithm for solving the balanced optimal problem is based on a variable splitting strategy and the classical alternating direction method. This paper shows that the proposed algorithm is fast and efficient in solving the standard image restoration with balanced regularization. More precisely, a regularized version of the Hessian matrix of the l2 data-fidelity term is involved, and by exploiting the related fast tight Parseval frame and the special structures of the observation matrices, the regularized Hessian matrix can perform quite efficiently for the frame-based standard image restoration applications, such as circular deconvolution in image deblurring and missing samples in image inpainting. Numerical simulations illustrate the efficiency of our proposed algorithm in the frame-based image restoration with balanced regularization.