Israel yesterday returned five Lebanese prisoners to Hezbollah after receiving the bodies of two kidnapped Israeli soldiers from the Lebanese group in a prisoners swap between the two sides.

Four imprisoned Hezbollah militants and a convicted Lebanese killer named Samir Kuntar were handed over to representatives of the International Committee of the Red Cross (ICRC) at the Rosh Hanikra border crossing, who then transferred them to the Lebaneseside.

Kuntar and the other four were pardoned by Israeli court and President Shimon Peres Tuesday in order to carry out the exchange, as the Israeli cabinet gave the final go-head to the prisoners swap deal with Hezbollah.

Prior to their return, Hezbollah delivered two bodies contained in black coffins. Following several hours of DNA tests, an Israeli forensic team concluded that the bodies were the remains of Ehud Goldwasser and Eldad Regev, who were captured by the Lebanese group two years ago.

The exchange is the major part of the swap deal mediated by a UN-appointed German official, under which Israel will also return the bodies of 199 others who were killed while infiltrating northern Israel.

Hezbollah is also required to return the remains of Israeli soldiers killed in south Lebanon during a 34-day war sparked by Goldwasser and Regev's capture in 2006. Meanwhile, the group also calls for the Jewish state to release scores of Palestinian prisoners on a later date.

The dramatic swap deal also saw that Hezbollah, days ago, transferred to Israel an 80-page report on the fate of missing Israeli navigator Ron Arad, who was shot down over Lebanon in 1986and held by Shiite Amal group until the night of May 4, 1988, whenhe disappeared.

Israeli Prime Minister Ehud Olmert has believed the release of Kuntar to be the last bargaining chip for information on Arad. But Israel said the report supplied by Hezbollah on Arad had failed to clarify his fate.

SORROW VS JOY

Seeing the black coffins on TV, many Israelis, foremost the two captives' families and friends, burst into tears, and an aunt of Regev's collapsed. Tens of people lit up memorial candles outside the soldiers' houses.

Although Israeli army said before the swap that they believed Goldwasser and Regev, were dead, the two families insisted that no evidence could verify that conclusion, and had been clinging to the last glimmer of hope.

"It was a terrible thing to see, really terrible. I was always optimistic, and I hoped all the time that I would meet Eldad and hug him," Regev's father Zvi told Army Radio.

"It is not easy to see this, although there was not much surprise to it," Goldwasser's father Shlomo told Israel Radio. "But confronting this reality was difficult."

"The entire Israeli nation is enveloping and hugging the Goldwasser and Regev families in their mourning. This is a day in which doubts have been removed regarding Udi and Eldad's fates butalso regarding Israel's moral might," said Olmert in a special statement.

Olmert and Defense Minister Ehud Barak are to meet the families later Wednesday when the bereaved will bid farewell to their beloved ones. Funerals have been scheduled for Thursday.

The sorrow marked a sharp contrast with the joyous atmosphere among Hezbollah supporters, as the return of Kuntar, who was sentenced to life plus 40 years in prison for murdering three family members and a police officer in Nahariya in 1979, and the four militants is seen as a big victory for the militant group.

TV footage showed that the five returnees received a red-carpet welcome at the Lebanese side, and a large event is being staged in Beirut to celebrate their release.

"I pity the people that are celebrating at this time the release of an animal that crushed the skull of a little girl of four," said Olmert, referring to Kuntar.

HOPE VS DANGER

UN Secretary-General Ban Ki-moon welcomed the execution of the swap deal, saying that he hoped that it was the first of many more.

As for Israelis, the next similar case is to secure the return of reservist Gilad Shalit, who was kidnapped two years ago by three Palestinian militant groups led by Hamas and believed to be still alive.

Israel and Hamas had been negotiating over Shalit's release for months through the middleman Egypt, and a ceasefire deal reached between the two sides last month called for more efforts to advance the talks.

However, the Gaza Strip ruler, which demanded Israel release hundreds of Palestinians in exchange for Shalit, announced earlier Wednesday that it had halted the Shalit talks because Israel did not commit itself to the ceasefire in Gaza.

Hamas also congratulated the release of the Lebanese prisoners. Hamas spokesman Sami Abu Zuhri said the swap represents "a great victory of the resistance" and that Hamas would not abandon the Palestinian prisoners jailed in Israel.

"This is also a proof that kidnapping Zionist soldiers is the best way to free the prisoners since the occupation keeps arresting them," Abu Zuhri added.

On Tuesday, Israeli National Security Council issued the most severe warning this year that terror cells in Egypt's Sinai Peninsula were planning kidnapping attempts against Israeli citizens, and urged Israelis traveling in the area to leave immediately.

Meanwhile, Israeli army have beefed up security measures along the border with Lebanon, amid worries that Hezbollah might launch attacks against Israel after the prisoners swap.