South Korea defence nominee withdraws South Korean President Park Geun-hye has decided to retain the incumbent defence minister after her preferred nominee for the post withdrew his candidacy over allegations of corruption, adding controversy over her cabinet picks. She appointed the country's new finance minister, its top financial regulator and its intelligence chief on Friday, moving a step closer to forming a full cabinet, after the National Assembly passed a bill to reorganise the government after nearly two months of political squabbling, which has hampered the new administration's fresh start. The presidential office said Kim Kwan-jin will be retained as defence minister after Ms Park's designate Kim Byung-kwan resigned after being accused of various wrongdoing including tax evasion and influence peddling. Kim Hang, the president's spokeswoman, told a briefing that Mr Kim will "continue his job in light of the grim security situation arising from North Korea's continuing threats and the necessity to ease worries among the people." It is the first time in the country's history that a defence minister has been retained under a new government. The decision comes as tension grows over the peninsula, with North Korea ratcheting up its hostile rhetoric against the South over new UN sanctions and the annual joint military drills between the US and South Korea. Ms Park had promised a new effort at engagement with North Korea before she took office but experts say time pressure has forced her to retain Mr Kim, who worked for former president Lee Myung-bak and is known for his hardline policy towards North Korea. Mr Kim has warned of swift and strong retaliation for North Korea's provocations. Under the government reorganisation bill, two ministries - science and fisheries - will be added while the job of trade negotiations will be moved from the foreign ministry to the commerce ministry. The passage of the overdue bill comes as a relief to Ms Park, who has struggled to assemble her cabinet. However, Kim Byung-kwan's resignation has intensified criticism of her ministerial appointments. "Her appointment style heralds a catastrophe," said Moon Hee-sang, the leader of the opposition Democratic United party. The defence minister nominee's withdrawal is the latest in a series of problems during the process of appointing high-ranking government officials. So far, at least six key nominees of top government posts resigned amid allegations of wrongdoing, dealing a blow to her election promise to clean up politics. Kim Yong-joon, her nominee for prime minister, stepped down even before she took office, amid controversy over decades-old property transactions. Kim Jeong-hoon, a Korean-American former president of Bell Labs, withdrew his nomination for science minister after coming under fire over his earlier advisory work for the US Central Intelligence Agency. His departure was widely seen as a setback for Ms Park's drive to build a "creative economy" through science and IT initiatives.