A senior Hezbollah official said that Israel's approval of a prisoner swap with his group was an official admission of defeat as Lebanon declared a national holiday to celebrate the return of Lebanese fighters held in Israeli prisons.

Earlier Tuesday, the cabinet ratified a prisoner exchange deal, to be carried out Wednesday, which will see five Lebanese prisoners released and transferred to Lebanon in exchange for two Israel Defense Forces reservists abducted by the Lebanese militia in July 2006.

Hezbollah's commander in south Lebanon, Sheik Nabil Kaouk, said the prisoner exchange demonstrates Israel's "humiliating failure in confronting the resistance both militarily and politically."

Kaouk added that he considered Israel's ratification of the deal an official admission of defeat.

Later Tuesday, the Lebanese government announced that Wednesday will be a national holiday to celebrate the "liberation of prisoners from the jails of the Israeli enemy and the return of the remains of martyrs."