By Michael Holden

LONDON (Reuters) - At least seven people were killed and more than 50 injured when a tram overturned on Wednesday morning in south London, police said and later confirmed the driver had been arrested.

Early indications were that the tram was travelling too fast on a sharp bend, investigators said.

Emergency services were called at about 6:10 am (0610 GMT) to reports that the two-carriage tram had derailed near a stop close to central Croydon, a large suburb to the south of the British capital and a major transport hub.

"We can confirm a total of at least seven people have sadly died at Croydon," police said in a statement. "Officers continue to work at the scene.

A police spokesman later said the tram's driver had been arrested, but did not specify why.

The independent Rail Accident Investigation Branch said the derailment had happened on a sharp curve with a 12 mph (20 kph) speed limit.

"Initial indications suggest that the tram was travelling at a significantly higher speed than is permitted," it said in a statement.

A London Ambulance spokesman said 51 others had been taken to hospital, some with serious injuries. Eight fire engines, five specialist rescue units and more than 70 firefighters attended the scene using heavy cutting equipment to free those trapped.

Television pictures showed the tram lying on its side across the tracks not far from the Sandilands stop near a junction where the line divides. Police said investigations were ongoing into the cause of the accident which took place in heavy rain.

Local resident Hannah Collier, 23, told local media she had seen very seriously injured casualties being taken away on stretchers.

"I was in bed watching the election when I heard a massive crash at about 6:15 am, which I thought was the wind," she said. "Then I heard people shouting and then the emergency services arriving."

Prime Minister Theresa May said her thoughts and prayers were with those affected by "this terrible incident".

Wednesday's incident was the greatest loss of life in a British rail accident since seven people were killed and 70 injured when a high-speed train from London came off the tracks at Potters Bar station north of the capital in 2002.

(Editing by Stephen Addison)