South Korea saw 4,248 new firms registered in February, down sharply from January's reading of 5,661, the Bank of Korea said in a statement. It was the lowest number since 4,095 companies were set up in September 2010.

The business start-up/failure ratio came to 55.2 last month, versus January's 76.5 which was the strongest reading in more than a decade.

The data came after the world's No.7 exporter posted forecast-beating exports and industrial production in recent months, boosting the average operation rate of facilities to a record high.

The central bank bumped up the base rate by 25 basis points to 3.00 percent earlier this month to contain inflation expectations after annual inflation exceeded its target range of 2-4 percent in January and February.