Bangladesh police on Thursday shot and killed two suspected commanders from a banned Islamist militant group blamed for a deadly bomb blast on a Shiite shrine in Dhaka.

Bangladesh police on Thursday shot and killed two suspected commanders from a banned terrorist militant group blamed for a deadly bomb blast on a Shiite shrine in Dhaka, officers said.

Detectives raided a Jamayetul Mujahideen Bangladesh (JMB) hideout in the capital around midnight following a tip-off, triggering a shootout with police.

"Two militants were wounded as police fired back after the militants hurled a grenade and started shooting indiscriminately. They were declared dead after they were brought to Dhaka Medical College Hospital," a police statement said.

One of the commanders named as Kamal, alias Hiron, was a suspect in the attack on Dhaka's packed shrine in October that left two dead and dozens injured.

Deputy commissioner Sanwar Hossain said commanders Abdullah al Noman and Kamal, who used one name, were both prime suspects in the murder of a police constable at a check-post in November.

Three JMB militants were also arrested during the overnight raid, police said.

Police have stepped up a crackdown on local terrorist militants after the Muslim-majority country was left reeling from an upsurge in deadly violence last year blamed on religious extremists.