A man facing charges in Northern Ireland over the alleged murder of two soldiers in 1972, a decade before his alleged involvement in the Hyde Park bombing atrocity, has been granted bail by the high court in Dublin.

John Downey, 66, was released from Cloverhill prison in the city on Thursday evening after bail of €35,000 (£30,000) was approved by the judge, Justice Aileen Donnelly.

The Garda Síochána arrested him on Monday at his home in Co Donegal on foot of a European extradition warrant over the deaths of L/Cpl Alfred Johnston, 32, and Pte James Eames, 33, two soldiers from the Ulster Defence Regiment who were killed by an IRA bomb in Enniskillen, Co Fermanagh, on 25 August 1972.

He is due to return to the court on 23 November for an extradition hearing.

Gardaí objected to bail, saying Downey was a flight risk because of the gravity of the offences and potential sentence if convicted. In granting bail, Donnelly noted that Downey had been on bail during court proceedings in England and abided by all conditions.

Downey was accused in 2013 of involvement in the 1982 Hyde Park attack in which four soldiers from the Household Cavalry were killed along with seven horses. His trial collapsed at the Old Bailey in 2014 because of a secret letter from the British government that gave him a guarantee he would not face trial, a revelation that caused uproar.

Downey was one of 187 IRA suspects given “clear and unequivocal assurance” that they were no longer wanted by any police force in the UK, a concession by the British government to secure an IRA promise to decommission its arms as part of the 1998 Good Friday peace deal.

His arrest this week on suspicion of the 1972 bombing was welcomed by relatives of the two soldiers as well as Unionist politicians in Northern Ireland. But Sinn Féin described the arrest as a politically motivated persecution of a republican who had aided the peace process.

In arguing for bail, Downey’s lawyer cited his health, saying he had recently had a pacemaker fitted.