Police questioned Israeli Prime Minister Ehud Olmert on Thursday for the second time this week as part of an investigation into whether he interfered in the sale of Israel's second largest bank.

The investigation into the privatization of Bank Leumi is one of two criminal probes facing Olmert. He also is suspected of buying a Jerusalem home from a real estate developer at a substantial discount in return for helping the builder obtain construction permits from Jerusalem authorities.

Olmert has denied any wrongdoing. But the investigations have embarrassed the prime minister just as his popularity is starting to rebound from harsh criticism for his handling of last year's inconclusive war in Lebanon.

Police arrived at Olmert's official residence in Jerusalem for questioning, police spokesman Micky Rosenfeld said. Olmert also was questioned for five hours on Tuesday in the same investigation, which is looking into possible breach of trust, Rosenfeld said.

He gave no further details on the interrogation, citing the sensitivity of the issue.

Israeli police suspect Olmert tried to rig the sale of Bank Leumi in favor of two associates when he was finance minister in 2005. The associates, Australian real estate developer Frank Lowy and American billionaire S. Daniel Abraham, never submitted a formal bid for the bank.

Olmert has said he is confident he will be cleared.

The questioning is a fresh setback for Olmert whose dismal popularity following last year's inconclusive war in Lebanon has finally started to rise.

Olmert has faced repeated allegations of corruption throughout his three-decade political career, but he has always proclaimed his innocence and has never been convicted.

In a separate investigation, police questioned a lawmaker for two hours Thursday morning on suspicions of sexual harassment. Police are looking into allegations that Izhak Ziv, of the Pensioners Party, harassed a female party activist.

Rosenfeld said Ziv would be questioned further, but had no information when that would happen. He also gave no details on the alleged incident involving Ziv and the woman.

But the Israeli paper Yediot Ahronoth reported that Ziv, 69, allegedly fondled the woman in a bedroom at his home before the 2006 parliamentary elections.

The paper reported the woman tried to resist, but Ziv threw her down on the bed. She then managed to get away and flee the apartment, the paper reported.

Ziv's office could not immediately be reached for comment.