LONDON - Credit ratings agency Standard & Poor's has retained its AA status with negative outlook for the United Kingdom, citing "significant risk" due to Brexit. The agency also noted risk to London's dominant financial sector, "which is a major contributor to employment and public receipts". It said Brexit will continue "to create challenging political and constitutional issues... especially if it results in a second referendum on Scottish independence or increases tensions around Northern Ireland". The vote to leave the European Union also led to a less predictable and less stable institutional and policy framework, "highlighted by the snap election called for June", a statement said. Prime Minister Theresa May took the country by surprise last week by calling for a general election to be held on June 8, hoping to increase her Conservative Party's slim parliamentary majority.

She is seeking to shore up her mandate ahead of two years of gruelling negotiations over the country's divorce from the EU. S&P said that although a stronger majority would give May more legitimacy and space to strike a "viable deal with the EU", there are still risks surrounding "both the election and the Brexit negotiations".