"I am not guilty of offences I am charged with," Sanader said at the arraignment before the Zagreb County Court in the Hypo bank loan case.

The Office for the Suppression of Corruption and Organised Crime (USKOK) indicts Sanader for having taken in the mid-1990s, when he was Deputy Foreign Minister, 3.6 million kuna in commission for a loan Croatia received from the Austrian Hypo bank.

The original arraignment, scheduled for last Friday, was postponed for today after a court expert said that he deemed Sanader unfit to stand trial due to his health problems. This morning the former prime minister wearing a dark suit was escorted from the Remetinec detention centre to the court room and he was not handcuffed as he was using a crutch.

At the very start of today's arraignment, Sanader was asked to state his name and personal identification information, including the information on his personal assets.

He said that he had earned a doctoral degree and that he was currently a member of the parliament, with the monthly salary of HRK 16,000.

As for his personal assets, Sanader said that he had a stake in two companies, based in Croatia, savings, an old car and an interest in a consulting company, headquartered in Austria.

As for his art collection Sanader said that its value was assessed according to the prices of paintings and works of arts from the time when he had collected it.

In response to the trial chamber presiding judge's question whether he served in the Croatian Army, he said that he had been a member of Croatia's wartime government and a member of the crisis management team for central Dalmatia which was why he was granted a rank of colonel in the Croatian Army and given several decorations.

Presiding Judge Ivan Turudic interrupted Sanader during his elaboration why he was given ranks and medals, adding that the indictee might give further explanatory remark on that subject during the presentation of his defence.

USKOK charges Sanader with abuse of office and powers in 1994 and 1995 when, as Deputy Foreign Minister, he conducted negotiations with the Austrian Hypo bank in Austria and in Zagreb about a loan to be given to Croatia while the war, a high inflation and extremely high interest rates on loans rendered the approval of loans for Croatia very difficult.

According to the indictment read out by Prosecutor Tamara Laptos, Sanader had agreed with Hypo bank executives the payment of a provision in the amount of seven million Austrian schillings, that is HRK 3.6 million. The kickbacks were paid to Sanader in their entirety after the bank and the Croatian government concluded the loan agreement on 140 million schillings to be given to Croatia for the purchase and equipment of diplomatic and consular offices,