Story Highlights

Bank of China closes accounts of N. Koreas Foreign Trade Bank Bank is believed to play key role in financing N. Koreas nuclear programs U.S. had asked China to do this in March

120 CONNECT 74 TWEET LINKEDIN 12 COMMENT EMAIL MORE

BEIJING (AP) — One of China’s biggest banks said Tuesday that it has stopped doing business with a North Korean bank accused by the U.S. of financing Pyongyang’s missile and nuclear programs.

It is the latest sign of Beijing’s displeasure with its estranged ally.

The state-run Bank of China has notified the Foreign Trade Bank of North Korea that its accounts were being closed and all financial transactions suspended, said a bank spokeswoman, reading a brief statement. The spokeswoman did not identify the number of accounts closed or provide further details.

The move comes after the Chinese leadership, installed last year, has shown growing frustration with North Korea’s young leader, Kim Jong Un, and the nuclear and missile tests his government has conducted, aggravating regional tensions.

In recent months, Beijing has displayed a willingness to work with Washington to apply pressure — from signing on to U.N. sanctions to issuing a statement with U.S. Secretary of State John Kerry last month urging North Korea to abandon its nuclear programs.

China is North Korea’s economic lifeline, providing nearly all its fuel and most of its trade. North Korea’s economic dependence on China is rising, following a standoff with South Korea that effectively shut an industrial park that was an important source of hard currency for North Korea.

The Bank of China’s suspension of business further complicates the ability of the Foreign Trade Bank, North Korea’s main foreign exchange bank, to access a key financial market.

In March, the U.S. Treasury Department imposed sanctions against the Foreign Trade Bank, effectively cutting it off from the U.S. financial system. It urged Beijing to do the same.

The department called the bank a key financial node in North Korea’s programs to develop weapons of mass destruction. It said the Foreign Trade Bank had financed other banks and companies already targeted by sanctions, including assisting in millions of dollars in transactions for the Korean Mining Development Corp. a major arms dealer.

120 CONNECT 74 TWEET LINKEDIN 12 COMMENT EMAIL MORE