The car bomb exploded yesterday outside a bank on a busy street in the southern Somali town of Baidoa.
"The blast killed 19 innocent victims and destroyed valuable property," the AU force said in a statement, updating an earlier toll from the police of 10.
The town, which is under the control of government troops backed by AU soldiers, was wrested from the Al-Qaeda-linked Shebab rebels two years ago.
No one has claimed responsibility for the attack, but the Shebab have carried out a string of bombings and vowed to overthrow the war-torn country's internationally-backed but fragile government.
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The Shebab have been driven out of fixed positions in Somalia's major towns by the UN-mandated AU force, but still regularly launch attacks that include bombings and guerrilla-style raids.
Recent Shebab attacks have targeted key areas of government or the security forces, in an apparent bid to discredit claims by the authorities that they are winning the war against the Islamist fighters.
Continued conflict, compounded by poor rains and funding shortfalls, are threatening the few gains made in Somalia since an extreme famine less than three years ago, with the United Nations and aid agencies warning the troubled country could be sliding back into a food crisis.
Today, over 50,000 severely malnourished children are at "death's door", a coalition of 22 international and Somali aid agencies warned earlier this month, with almost three million people in crisis and over one million forced from their homes.
The violence continues, with attacks even in the heart of the capital Mogadishu.