Finance Minister Kwon O-Kyu urged financial institutions to improve their competitiveness through active investment overseas.

"The government will help local funds improve their ability dramatically to invest abroad," he told reporters.

"We need a radical change in our financial rules," he said, vowing to revise tax codes and "unreasonable" regulations that have restricted outbound investment.

South Korea previously encouraged companies to invest within the country to create jobs, increase production and exports and boost domestic economic growth.

But the policy has resulted in the rise of the won, which raises the price of exports, and more foreign direct investment into the country than outbound investment.