RFE/RL's North Caucasus Service reported that Arsen Kanokov made those comments at a press briefing in Nalchik.
Kanokov said the decision to turn the bodies to families did not depend on him, but on federal authorities. Kremlin officials say Russian legislation forbids the restitution of the bodies of suspected terrorists.
The bodies of the 95 alleged militants officially killed in the 13 October raid were initially kept in refrigerated railroad cars on the edge of the city. But their current whereabouts are unknown. Reports that they were secretly taken to another location have not been confirmed.
Eyewitnesses say most of the raiders were local Nalchik residents.
(RFE/RL's North Caucasus Service, Kavkazsky Uzel)