S. Korea needs to enhance financial stability: BOK head

South Korea should make efforts to enhance its financial stability by tackling volatile cross-border capital flows in a bid to beef up its economic fundamentals, the country's top central banker said Wednesday.

Bank of Korea (BOK) Gov. Kim Choong-soo said at a forum in Seoul that Korea should continue its efforts to dispel potential risks lurking in the financial system and draw up measures to smooth out cross-border capital movements.

Since 2010, Korea has taken a set of macro-prudential steps as the country has fallen victim to volatile capital flows whenever a financial crisis has cropped up.

Kim said on Monday that Korea may strengthen its measures to ease volatile capital movements, if needed, but any such measures would not take on features of capital control.

His remarks earlier this week were quite different from his stance showed at Friday's press conference where he said that Korea is always open to adjusting its macro-prudential measures, but now is not the time to discuss it.

The governor also said that the BOK plans to flexibly manage the monetary policy by taking into account economic conditions at home and abroad.

"The main task facing Korea is to brace for economic uncertainty including the protracted eurozone debt crisis and the fiscal cliff risks in the U.S.," Kim added.

The BOK froze the key rate at 2.75 percent on Friday following its rate cut in October as recent economic data pointed to improvements. The bank trimmed the rate in July as well. (Yonhap News)