Bank of China Ltd. said it cut off dealings with North Korea's primary foreign-exchange bank in the first publicly announced move by a Chinese state-owned company to distance itself from Pyongyang and its young leader Kim Jong Eun.

The Obama administration quickly praised Bank of China's action Tuesday as an important step in attempting to contain North Korea's growing nuclear-weapons and ballistic-missile programs.

The U.S. has accused the Foreign Trade Bank of North Korea, which performs many functions of a central bank, of facilitating millions of dollars of transactions on behalf of North Korean arms companies and entities involved in Pyongyang's nuclear program.

Treasury Secretary Jacob Lew specifically raised the issue of the Foreign Trade Bank during his meetings with senior Chinese officials last month in Beijing, according to senior U.S. officials.

The Obama administration has been alarmed by escalating threats by the North against U.S. and allied targets in Asia. Pyongyang has also conducted a nuclear-weapon and long-range missile test in recent months.