Vrbanovic said a match delegate also requested that the banner be removed after consultations with FIFA.
"That banner bothered FARE. Since they are lecturing us, they too should be educational. It is well known what Vukovar means to people in Croatia," he said.
Reporters asked him how it was possible that there were no major reactions when the Croatian flag was set on fire during a Serbia-Croatia match in Belgrade, yet it was prohibited to display a banner with Vukovar's name on it in Zagreb.
Vrbanovic said: "We need to worry about Croatia's treatment by UEFA and FIFA. Before the match with Iceland in Zagreb, we asked for a minute's silence for Vukovar and for the banner (to be displayed), but the delegate was obviously scared. He asked for FIFA's opinion, which banned the banner. A big mistake was made."
The eastern town of Vukovar on Monday held a remembrance day for its victims of the 1991-95 Homeland War.