An Israeli court acquitted former prime minister Ehud Olmert on two key corruption charges on Tuesday while finding him guilty on a lesser charge, in a verdict he hailed as just.

The Jerusalem district court cleared Olmert on charges of receiving cash-stuffed envelopes and falsely billing trips abroad multiple times, but convicted him on the charge of granting favors to a former colleague during his time as a minister.

Olmert still faces a second trial over allegations he accepted bribes during his time as Jerusalem mayor to smooth the way for the construction of the massive Holyland residential complex in the city.

But his acquittal on the most serious charges against him in this trial, including the allegations that forced him to resign from his post as prime minister in 2008, will be seen as a victory for the former leader.

The former premier hailed the verdict outside the courtroom.

Olmert faced three primary allegations in the first trial against him.

The first charge related to favors he granted a former colleague, Uri Messer, while Olmert was serving as trade and industry minister.

On that charge, the court found Olmert guilty, saying he displayed a "conflict of interest," in the lengthy ruling handed down on Tuesday morning.

Olmert was also accused of receiving hundreds of thousands of dollars from Jewish-American businessman Morris Talanski, in return for promoting his companies in Israel.

And he was alleged to have engaged in multiple-billing of trips overseas, on occasions charging as many as four different institutions for the same trip.

But he was acquitted on both those charges, with judges saying the evidence failed to prove "beyond a reasonable" doubt that Olmert was guilty.

He acknowledged his conviction on the third set of allegations, but said the judgment described his behavior as "procedural misconduct."

Olmert was mayor of Jerusalem from 1993 to 2003 after which he served as a cabinet minister, holding the trade and industry portfolio as well as several others, before becoming premier in 2006.

He led the center-right Kadima party into government, but resigned from the premiership in September 2008 after police recommended he be indicted in several graft cases.

He has consistently proclaimed his innocence, calling the allegations against him a "ruthless witch-hunt."

Deliberations on Olmert's sentence are set to begin in September, and in the meantime he faces allegations in a separate case that he accepted bribes in return for helping the developers of the Holyland residential complex in Jerusalem.

AFP