Anglo Irish Bank is recruiting 125 staff to bring news skills into the institution in preparation for its split into a 'good' bank and a 'bad' asset management company, the bank has confirmed.

The positions, mainly in risk management, legal and general governance, are being filled to address gaps that have opened up through the bank's redundancy programme and through natural attrition in the last year.

The move comes as the European Commission considers whether Anglo's business plan, which is based on carving out a smaller business lender from the wreckage of the failed property bank, is viable.

"Even as the restructuring is being deliberated by the European Commission, the bank needs to be retooled for the split if approval is granted," an Anglo spokesman said.

Anglo is also recruiting to address its lending skills deficit so it can deal with SME clients, according to the spokesman.

The Financial Regulator has called for domestic banks to develop greater competency in cash flow lending to businesses instead of collateral lending, which dominated during the boom.

The bank currently has fewer than 1,000 employees, following 850 departures since the bank began downsizing last year. Of that number, 137 have moved to the bank's full-time Nama unit dealing with the transfer of €36bn of bad loans into the state agency.