Italian police have stormed a bank in Milan and captured a gunman, ending a siege which had lasted more than 24 hours.

Italian television said the Sicilian-born gunman Domenico Gargano, 35, and two policemen were injured as shots were fired during the assault.

Gargano had seized four hostages on Monday after being refused a loan.

Police said they had given him a $2 million in ransom but refused his request for a getaway helicopter.

Gargano took over a branch of the Banco Popolare di Milano in the south-eastern suburbs of Milan just before closing time on Monday and held the manager and two other workers hostage overnight.

Domenico Gargano...has surrendered

He was armed with a pistol and a hand grenade.

Gargano earlier handed over the grenade to negotiators after setting free his last hostage.

He had earlier been given a four billion lire (£1.2m) ransom by senior bank officials.

Armed officers had surrounded the building and special forces were reported to be standing by.

Negotiations with Gargano were led by Francesco Savirio Borelli, one of Italy's top judges.

Bank president, Paolo Bassi, joined in the negotiations overnight

The bank's president, Paolo Bassi, was also involved in the talks.

Gargano had earlier refused pleas from his girlfriend and mother to surrender.

He took over the bank when he was refused a mortgage because of his convictions for theft and deception.

Gargano seized four employees - one was released almost immediately - and demanded a ransom of 10bn lire (£3.7m).

He later lowered his demand to 6bn lire (£2.1m).

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