“They came out in the stairs and carried out a big explosion. Parts of their bodies were spread to 25-30 yards (metres),” said Sanwar Hossain, additional deputy commissioner of the police counter-terrorism unit.
“Two people including a woman are confirmed dead,” he said, adding parts of the staircase were blown off in the explosion, according to the hindustantimes.com.
National police chief AKM Shahidul Hoque told AFP that the dead were members of a new faction of the homegrown Islamist extremist group Jamayetul Mujahideen Bangladesh (JMB), blamed for a series of deadly attacks including a cafe siege in Dhaka where 22 people including 18 foreign hostages were killed.
“Probably three militants including one female died. Two policemen (were) injured,” he said in a text message.
Police had cordoned off the hideout during a major counter-terrorism drive in Sitakundu town, outside Chittagong, since Wednesday evening after suspected militants threw grenades and opened fire at officers.
The gunfight began after police, backed up by an elite security unit, besieged a two-storied building. Police said an officer was wounded by a grenade during the raid.
“The extremists threw at least 10 grenades at our officers. We suspect two to eight extremists are staying in one of the ground floor flats in the building,” additional superintendent of police Mosiuddowla Reza told AFP.
“They also opened fire at us with pistols,” he added.
Elite counter-terrorism police reinforcements were sent to Sitakundu after midnight to storm the compound, he said, adding around 10-20 civilians were also trapped in the building, “but none of them were taken hostage”.
“We’ll storm the compound after making sure all the civilians are safe,” Reza said.
Hours earlier police arrested a couple from another house after officers stormed their hideout in the same town, Reza said.
“We arrested them as the wife was holding her three-month old child in one hand and tried to explode the suicide vest with the other. Our bomb disposal unit later defused the vest,” he added.
Reza said the couple and the extremists who were holed up in the two storey building were JMB members.
The faction is blamed for attacks on religious minorities and foreigners.
The Islamic State organisation has claimed responsibilities for many of these assaults but the government and police have rejected the claims.