Zagorec had accounts in Liechtenstein that have been discovered with EUR 16.5 million in frozen funds, but the country's authorities unfroze them at Austria's request and transferred to the Hypo bank.

Zagorec applied for the loans to buy real estate in Croatia and develop it, Kurier said.

Two large loans given to Zagorec's Vienna-based company Aktor, which dealt in real estate, have also been cleared. Kurier said Zagorec found a buyer for two properties and that sales contracts were signed with the Immovate company.

Hypo has got back its loans for both properties in the amount of EUR 43 million, Kurier said.

The bank has also got back EUR 500,000 from its former board chairman Wolfgang Kulterer who put up that amount as collateral for a loan for projects in Croatia.

Zagorec is serving a seven-year prison sentence for abuse of office after taking a bag with jewels from the Croatian Defence Ministry as he was leaving his post in 2000.