South Korean President Moon Jae-in watches as President Donald Trump waves after they spoke in the Rose Garden of the White House in Washington, on June 30, 2017.

:: Washington’s move to shut off Bank of Dandong from the U.S. financial system punishes a small regional Chinese lender with what US authorities say has been an outsized exposure to North Korea and its banned nuclear and missile programs.

The US Treasury on Thursday accused the bank of facilitating millions of dollars in transactions for companies tied to North Korea’s weapons development, as Washington ratchets up pressure on Beijing to rein-in its isolated neighbor and ally.

“Bank of Dandong will in effect be shunned by the US banks that may in the past have been used to clear its transactions,” said William Newcomb, a former member of the United Nations Panel of Experts on North Korea. “Most international banks will also cease dealing with Bank of Dandong because of reputational risk.”

“Similarly, other Chinese banks could damage their own ability to cleartransactions should they try to act on Bank of Dandong’s behalf and be found out,” he said, calling the move “an overdue step.”

Key conduit

Based in the northeastern border city of Dandong, through which the bulk of North Korea’s trade with China flows, Bank of Dandong is small, with five branches, 1,570 staff, and assets of $10.66 billion.

But according to the US Treasury, Pyongyang has used it as a key conduit to the US. financial system.

“As of mid-February 2016, North Korea was using bank accounts under false names and conducting financial transactions through banks located in China, Hong Kong, and various southeast Asian countries,” it said. “The primary bank in China was Bank of Dandong.”

North Korea is subject to UN Security Council sanctions over its nuclear and ballistic missile programs.

The US Treasury on Thursday also sanctioned China’s Dalian Global Unity Shipping Co Ltd, as well as two Chinese citizens.

Bank of Dandong and the China Banking Regulatory Commission did not respond to faxes seeking comment. China’s foreign ministry said it opposes sanctions outside the UN framework.