A bomb has exploded in the southern Philippines, injuring at least 18 people.

Police in Kidapawan city, a largely Christian town on the island of Mindanao, said the bomb was placed in front of a three-storey commercial complex.

Several of those hurt were caught in a huge fire that the bomb sparked in the office block.

The incident is the latest in a series of bomb attacks in the south of the country.

In October 2002, a bomb at a bus station in Kidapawan city killed seven people and injured 24 others.

Tuesday's bomb went off at around 1300 local time (0500 GMT) as police worked to defuse it. One police officer reportedly lost his hand as a result.

"It was a powerful blast," police chief Casimiro Medes told the Associated Press news agency. "We still don't know if it was a grenade or a mortar, but the explosive had shrapnel."

Police said that witnesses saw three men plant the bomb outside the building, hidden in a plastic bag.

Muslim extremists blamed

The governor of North Cotaboto province, Emmanuel Pinol, said he believed a regional Muslim extremist group may have been responsible.

"It is possible that this is the work of elements linked to the Moro Islamic Liberation Front (MILF)," Emmanuel Pinol told Reuters news agency.

The MILF has been linked to several attacks in the area, including a blast in the southern town of Datu Piang which killed at least 13 people in December.

The group, which operates on central Mindanao island, has signed a ceasefire with the government and peace talks are expected to resume in Malaysia next month.

The southern Philippines has been a scene of separatist conflict for 30 years, led by Muslim rebels in the predominantly Catholic country.