How did the police save the hostages in the bank in Inside Man?

From the wiki page for Inside Man:

The robbers detonate smoke bombs throughout the bank and release the hostages, resulting in a horde of identically dressed people exiting through the smoke in mass confusion. The police detain and interrogate everyone. However, the police are unable to distinguish the robbers from among the hostages. The police search fails to turn up Russell, but reveals the hostage execution was faked and the robbers' weapons turn out to be plastic toy replicas. As nothing appears to have been stolen, Frazier's superior orders him to bury the case, commenting "What do you expect me to say?".

So, in effect the police didn't really save the hostages themselves - the robbers released them as part of their elaborate scheme. If you'll recall, the whole point of the plan was to hide the gang leader (Clive Owen) inside the building.

Robbers had managed to bug the conversations of the police officers in the MCC by planting a transmitter on the drawer given to them with their demands in it. When they heared the plan to enter the bank through the device, they released all the hostages and just got out along with them.