A gunman who took four people hostage in a bank in Toulouse has been captured, and his captives released unharmed.
Police said the man was slightly injured in the operation to capture him.
The announcement came soon after a series of gunshots were heard from the area of the bank.
Authorities say the gunman had psychiatric problems in the past and claimed he was acting for religious reasons.
Some reports said he claimed allegiance to al Qaida.
The incident plunged the city into fear for the second time in recent months. Tensions have been high in Toulouse since March, when a gunman who police said claimed links to al Qaida killed three Jewish schoolchildren, a rabbi and three paratroopers in the area. Those were France's worst terrorist attacks in years, and led to a crackdown on suspected Islamist radicals around France.
In the latest incident, the gunman entered a CIC bank branch in central Toulouse at about 11am local time and took the bank director and three other employees hostage. Authorities started negotiations with the gunman, and he released one hostage mid-afternoon, a woman in her late 20s who was feeling ill.
Toulouse Mayor Pierre Cohen said the gunman had been known to authorities for having psychiatric problems. French Prosecutor Michel Valet said that during negotiations, the gunman said he wanted to advertise the religious motivation behind his act.
The bank is in the same neighbourhood where Mohamed Merah, the suspected gunman in the March attacks, was shot and killed by police. It is near the police station where authorities were overseeing the operation to surround and negotiate with Merah.
While there was no sign that the latest gunman had links to terrorism, it came amid heightened concerns in France about homegrown radicals following the Merah affair. Pakistan had earlier announced it had arrested a Frenchman reportedly linked to one of the masterminds of the September 11 terrorist attack.