SEOUL (AFP) - South Korean president-elect Park Geun Hye's incoming administration has been hit even before it takes office, with her nominee for prime minister withdrawing ahead of his confirmation hearings.

Mr Kim Yong Joon, 74, a former Constitutional Court chief and current head of Ms Park's transition committee, stepped aside after media reports raised suspicions about his accumulated family wealth.

Allegations were made that he had benefited from a series of unethical real-estate deals in the 1970s and 80s, while other questions were raised over the exemptions his two sons received from South Korea's mandatory military service.

"I decided to resign as the prime minister nominee as I have caused concerns to the people and trouble to the president-elect," Mr Kim said in a statement on Tuesday.

His withdrawal is a major embarrassment for Ms Park, who has spent the past few days berating outgoing President Lee Myung Bak over his decision to pardon a number of friends and close aides serving jail terms for corruption.

"We see it as a decision made after a great consideration by the nominee and the party respects the decision," her ruling Saenuri Party said in a short statement.

Mr Kim, who overcame polio to become the country's youngest judge and went on to a seat on the Supreme Court and finally to head the Constitutional Court, had been a surprise nominee.

The main opposition party blamed his withdrawal on Ms Park's "closed-door" style of personnel selection and urged her to employ a more "open, transparent personnel vetting process".

Successive South Korean presidents have taken office vowing to combat corruption only to be tainted by corruption scandals involving relatives or senior members of their administrations.