The 25-year-old man was arrested following a raid on a hideout in Koronadal City on Sunday, three days after the blast in the citys public market, which killed three people and wounded 29 others, Region 12 police director Chief Superintendent Manuel Raval told reporters.
He said two other suspects were being hunted down. Initial investigation showed that the motive could be extortion, Raval said.
"There will be more arrests anytime now," Raval said.
Police said the arrested suspect may be linked to the Abu Sayyaf, a small group of self-styled Islamic militants blamed for a rash of high-profile kidnappings and bombings in the south in recent years.
Raval said that 30 minutes after the improvised bomb tore through the Koronadal public market, a man claiming to be Abu Sulaiman, an Abu Sayyaf leader, called Mayor Fernando Miguel and claimed responsibility for the attack.
Sulaiman reportedly told the mayor that the bombing was in retaliation for a refusal to pay extortion money, police said.
Authorities were also looking into the possible involvement of the Moro Islamic Liberation Front (MILF).
Meanwhile, Armed Forces Southern Command chief Maj. Gen. Roy Kyamko declared yesterday a full offensive against the Abu Sayyaf bandits in Palimbang, a coastal town in Sultan Kudarat.
Kyamko said the offensive they have been conducting against the elusive Abu Sayyaf bandits has been bolstered by the support of the residents of Palimbang.
Local town leaders confirmed that the bandit group being pursued by government troops is headed by Abu Sayyaf chieftain Khaddafi Janjalani.
Townsmen told the military that Janjalani, with 54 armed followers equipped with 90RR (recoilless rockets) landed two weeks ago in the coastal village of Libua on board three pump boats from the Zamboanga peninsula.