Manila, Mar 2 (AFP) A sacked security guard gave himself up and set free dozens of hostages he seized at gunpoint on Monday in a Manila mall, ending a day-long standoff that terrified shoppers and left one man wounded.

The gunman, who launched the attack over his dismissal, walked out of the V-Mall and was able to complain to reporters about his former employers before police tackled him.

Authorities initially said about 30 people were held in an office inside the mall, but once the standoff ended they said the number was up to 70.

"The crisis is over," said Francis Zamora, mayor of San Juan City, which includes the mall. "They're all safe now."

The drama kicked off Monday morning when the suspect shot and wounded another security guard, who was rushed to hospital in stable condition, and barricaded the hostages in an office.

The gunman was armed with a pistol and what he claimed was a hand grenade when he burst into the mall, sending terrified shoppers and workers fleeing.

Heavily armed police in battle gear and carrying assault rifles massed at the shopping centre while scores of onlookers snapped pictures with their mobile phones.

Zamora told reporters the hostage-taker was upset after losing his job, and had turned to violence to air his grievances.

Authorities worked for hours to convince him to surrender, and later in the day held a press conference where company officers apologised for upsetting him.

"I deeply regret my shortcomings," one of his former supervisors said.

"Because of this, I will resign from my post... to give way to a solution to our current problem."

Police were in contact with the suspect for hours via a walkie talkie.

Philippine malls are centres of life that include everything from restaurants and shops to churches and medical facilities. The building was full when the violence began.

Witness John Paul Buenavista told AFP he saw a wounded person -- believed to be a guard at the mall -- being put into a wheelchair and whisked away.

"We heard three gunshots. Then we saw people running, saying they saw someone getting shot," he said.

Manila was the site of a high-profile 2010 hostage-taking that ended with the deaths of eight Hong Kong tourists.

That day-long ordeal started when an ex-police officer, armed with an M-16 assault rifle, hijacked a bus near a popular tourist destination just a few blocks from police headquarters in a desperate bid to get his job back.

Negotiations broke down after nightfall and the ex-officer began shooting passengers, prompting commandos to storm the bus. (AFP)

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