(Adds finance minister comment, background)

VIENNA Oct 14 (Reuters) – A group of creditors representing
claims of more than 2.5 billion euros ($2.9 billion) against
Austrian “bad bank” Heta condemned on Wednesday a
draft law on a settlement with the German state of Bavaria and
said it would fight Vienna’s plan.

Austria’s parliament is expected to pass a bill on Thursday
to implement a settlement reached with Bavaria, the former owner
of Heta’s predecessor Hypo Alpe Adria, by paying 1.23 billion
euros, or 45 percent of Bavaria’s claims.

In addition to money from selling Heta assets, the bill
would also pave the way for federal loans to help Hypo’s home
province of Carinthia pay investors by buying back debt.

Officials have remained silent on the size of losses that
other creditors likely face. However, Finance Minister Hans
Joerg Schelling has said the Bavaria settlement cannot be viewed
as an indicator of what others can expect, leading some to fear
they will get less favourable terms.

Legal attempts to solve Hypo Alpe Adria’s failure have run
into difficulties. In July, Austria’s highest court overturned a
law that had cancelled almost a billion euros of Hypo
debt.

“The federal government still proceeds without any
involvement of the creditors,” said the group, which includes
Germany’s Commerzbank, on Wednesday. “The creditors
will fight this plan of action by all available means.”

Lawyers representing Kaerntner Landesholding, a holding
company in Carinthia, said last month the plans to buy back debt
guaranteed by Carinthia had received “no negative comment” from
creditors bar one.

“This buyback model results in us ensuring that we get
Carinthia out of their guarantees,” Schelling told parliament on
Wednesday.

Carinthia, whose credit ratings have suffered under the Hypo
scandal, has guaranteed around 11 billion euros in Hypo debt,
the equivalent of five times its annual budget.

The creditors in their statement on Wednesday, calling
themselves Ad Hoc group, said they saw the Bavaria settlement as
preferential treatment of one creditor at the expense of others.

“We will oppose all special legislation which devalues the
statutory guarantees of Carinthia … in front of the European
Court of Justice, by international investment arbitration or if
necessary in front of the European Court of Human Rights.”

A settlement with Heta creditors such as the Ad Hoc group
must be reached before a debt repayment moratorium runs out at
the end of May.

($1 = 0.8769 euros)

(Reporting by Francois Murphy and Shadia Nasralla; Editing by
Louise Heavens and Mark Potter)