The new team is on board now and the primary objective is to address the shortcomings in the previous business model and its management activities and to place the bank back on a stable platform. As Mr. Dukes also pointed out, we have been appointed to operate in the best interests of the shareholder — the taxpayer — and this leads us in everything we are doing in Anglo Irish Bank at this point.
I will briefly review some of the areas where we have made some rapid and fundamental changes to the bank's business model in the past year. Our approach is focused on a number of key areas and among them are governance and oversight. The corporate board and committee structures have been addressed, the finance function has been addressed and risk management, in terms of credit risk, market risk and operational risk functions, has been and continues to be addressed. We continue to go through a necessary downsizing and derisking of the balance sheet in the current business.
We must also manage our business on a day-to-day basis, so we have an acute focus on the management of various asset portfolios, both those that are bound for NAMA and those that remain with the bank. Operating in a marketplace where the state of the markets is fragile both here and in Europe, we have a keen focus around the funding and liquidity aspects of the management of the bank. The other major area we are focusing on that is coming to a rapid conclusion over the next two or three months is the restructuring plan and the analysis and decision process regarding the future of the bank in the context of the restructuring plan.
We have a number of examples for the areas we have focused on. From a cost perspective, we conducted a thorough cost management initiative which has reduced the cost base by 18%, or €58 million. We have completed a voluntary redundancy plan that has reduced staff by 290. This, together with natural attrition, has been central to the reduction of staff numbers from a peak pre-nationalisation of around 1,800 to about 1,200 today, excluding the NAMA unit of the bank. Interestingly, the reduction of pre-nationalisation staff is now of the order of 800 from the peak. That is a substantial reduction, meaning that part of the process of organisation or renewal means that the natural attrition process has required us to hire around 200 people again. As Mr. Dukes pointed out, it is a different organisation from the bank before nationalisation. An organisation's culture hinges on those in it.
We have also implemented fundamentally new risk management governance and control frameworks. From a risk management perspective, we have reworked the risk management processes around credit risk. Initial focus was on that area because of the substantial exposure to the commercial real estate property markets. We have also focused on making sure that the risk processes around our market risk activities are tight. We run a large balance sheet, with significant exposures, both in capital and foreign exchange, so it is important that we made sure our risk processes are appropriate.
From a finance perspective, led by Mr. van Eden, there has been a total redesign of the finance function, a necessary focus specifically targeted at the management of capital and the management of the balance sheet generally. Importantly, initiatives that are currently under way around management information systems and loan data will allow us to open up the transparency of the organisation to new levels.
From a governance perspective, we have aligned the board committee structures and charters with best practice, as well as making sure the key management committees of the group are also operating at best practice level. We have initiated independent reviews of all our major business loans, lending activities in Ireland, the US and Britain, treasury and financial markets and all supporting and control functions, covering finance and risk areas, and operations, technology and human resource functions.
We have commenced the reduction and de-risking of the balance sheet, with analysis of the balance sheet and all activity in each market, each sector and each geographical location. We have been downsizing exposures and restructuring where possible to support improved asset quality and we have seen a reduction of discretionary treasury assets and a focus on liquidity management and funding needs.
We are fully supportive and committed to participating in NAMA and the first tranche is now complete. We are working towards the move of the second tranche later this month. We have been working on maximising recovery of loans. We have been establishing recovery units in Ireland, the UK and the USA. This is another area where we have brought in specialist expertise. We have initiatives operating around certain particular problem areas of the portfolio. Many of these have been well publicised, for example, former directors' loans and in areas where we have unacceptable large exposures to the bank, such as the exposure of the Quinn Group. These areas are under ongoing focus.
In terms of recapitalising the bank to minimum capital adequacy levels, this is a process internally led by the CFO office. This is obviously done in close consultation and co-operation with the Department of Finance, the NTMA and the Financial Regulator.
The main initiative during the past nine months has been the development of a comprehensive business plan and that process has been extremely thorough and lengthy and I will discuss this further shortly. Before I give members a brief overview of the restructuring plan initiative, I will hand over to my colleague, Maarten van Eden, chief financial officer, who will cover off on two areas, the results as at the end of last year. It is probably worthwhile to go through the position with regard to the current capital situation and expectations of the group.