From 30 June, loans will be classified as 'bad' only once they have been overdue for at least 12 months, compared to nine months previously, among other changes.
KT Corporation was planning to up its stake in the internet-only bank to 34%, but the FSC put its review process on hold amid an FTC antitrust probe.
Only 100 P2P lending platforms are expected to qualify for new licences under the new registration system set to be introduced later this year.
The focus of the joint audit will be on the small business lending practices at Shinhan Bank, KB Kookmin Bank, Woori Bank and KEB Hana Bank.
The reforms will lower the risk weights Korean banks use, resulting in reduced risk-weighted assets and freed-up capital, which will likely be used for new loans or to pay out dividends.
Additional policy work is needed to level the playing field for internationally active entities, according to Financial Stability Institute chairman Fernando Restoy.
There is a need for supervisors to consider local specificities when implementing the framework in less developed markets, ISDA says.
The proposals could relax capital and stress testing requirements for US branches of foreign banks, but impose stricter liquidity rules on those that engage in riskier activities.
The consolidated Basel Framework has been published initially in draft form, together with a consultative document on technical amendments to the standards.
The RBI has deferred a requirement for banks to link loan rates to external benchmarks, citing difficulties the change presents to banks' interest rate risk management.