French police arrested a man who took hostages in a bank in the southwestern French city of Toulouse yesterday, police said.

The man, who had claimed to be a member of al-Qaeda, was arrested when police launched an assault in which he was injured.

The man, known to the police for his record of petty offences and psychological problems, released two female hostages after receiving food and water in the early afternoon, police sources said.

The man took the hostages, who included the bank manager, in a branch of French bank CIC at mid-morning and fired a shot after an attempted armed robbery apparently went wrong, UNSA police union official Cedric Delage said.

"The man has made clear that he [was] not acting for money but for religious reasons. He wants us to make that message clear," Prosecutor Michel Valet said.

Police earlier said four hostages were involved in the latest drama to hit the Toulouse region since a young al-Qaeda-inspired gunman shot dead three soldiers, a rabbi and three Jewish children in March.