The United States on Friday formally prohibited US financial institutions from opening or maintaining accounts created on behalf of North Korean banks, extending sanctions imposed on the isolated Asian country over its nuclear and missile programs.

The US Treasury Department said North Korea was using front companies and agents to conduct illicit financial transactions to support the proliferation of weapons of mass destruction and to evade international sanctions.

“Such funds have no place in any reputable financial system,” Adam Szubin, the department's acting under secretary for Terrorism and Financial Intelligence said in a statement.

It said that while US law already generally prohibited transactions with North Korean financial institutions, the move would support international sanctions and better protect the US financial system from illicit North Korean activity.

A Treasury Department order requires US financial institutions "to apply additional due diligence measures to prevent North Korean financial institutions from gaining improper indirect access to US correspondent accounts."

The move comes after the Treasury in June declared North Korea a "primary money laundering concern" and proposed the steps to further block its ability to use the US and world financial systems to fund its weapons programs.

Friday's announcement comes as the United States is pushing for tougher United Nations sanctions against North Korea after its latest nuclear test on September 9.

China's support is crucial for the sanctions to be effective but Beijing has appeared to push back on US efforts to tighten restrictions on North Korean exports.

Beijing expressed concern when the US Treasury plans were announced in June, saying it opposed any country using its domestic laws to impose unilateral sanctions on another country.