SCENARIOS - Post Kim, how might events unfold in North Korea?

By Dean Yates

SINGAPORE (Reuters) - North Korean leader Kim Jong-il has pancreatic cancer and the illness is life-threatening, South Korean broadcaster YTN said on Monday based on information gathered by Chinese and South Korean intelligence sources.

Kim, 67, is believed to have also suffered a stroke last August. Kim's poor health and apparent moves to anoint his youngest son to succeed him have raised questions about the longevity of the regime in Pyongyang.

Following are scenarios for how the situation may play out in North Korea over the coming months and years.

SMOOTH TRANSITION

The longer Kim lives and remains in reasonable health, the greater the chance of a smooth transition of power to his youngest son, Kim Jong-un, 25. If Jong-un has 15 or 20 years to cement his position, he may be able to continue the Kim dynasty.

Kim junior is also believed to have the backing of Jang Song-thaek, effectively the country's number 2 leader. Kim Jong-il in April promoted Jang, his 63-year-old brother-in-law, to the powerful National Defence Commission, which many analysts saw as an attempt to establish a mechanism for the transfer of power, with Jang as kingmaker.

Under this scenario, financial market players would watch events in North Korea with interest but not trade dramatically either way. Global powers would seek to ascertain the intentions of the new leadership as it took shape. North Korean policy toward the outside world may not alter much.