Sources told the Nine O'Clock news that the fraud extracted "substantial amounts" of money.

But Egg continues to insist that the fraudsters, who attempted to establish bogus accounts, only stole a nominal amount of money from the bank, in which Prudential has a majority stake.

The news raises fresh fears about online security and comes as the National Crime Squad decides to widen its probe into fraud at internet banks.

Multiple applications

The alleged fraud was a simple deception using fake names and addresses on multiple applications for savings accounts and loans.

Egg has admitted that some cards were issued.

Egg, which has 1.1 million customers, stressed that no money was stolen from individual accounts, and that none of its computer or security systems had been breached.

"In no way have any of our customers suffered," Gary Clifton-Marshall, the bank's operations director, said.

All banks, not just internet ones, faced the same level of security risks in such cases, Egg claims.

It was advanced software which can spot multiple applications coming from the same computer, and which Egg installed two months ago, which had led to the arrests on Wednesday, the bank added.

On Wednesday, three men were released on police bail after being arrested by officers investigating the break-in.