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BEIJING — China took a newly tough approach to communist ally North Korea on Friday, siding with the United States in saying the North must back away from nuclear confrontation, and moving to cut Pyongyang's vital supply of hard currency.

Chinese banks have stopped financial transfers to North Korea under government orders, bank employees said Friday.

At an appearance with Secretary of State Condoleezza Rice, China's foreign minister nudged the North to resume negotiations over its nuclear program and assured Washington that China would carry out United Nations sanctions on Pyongyang.

"We hope all relevant parties will maintain coolheadedness, adopt a prudent and a responsible approach and adhere to peaceful dialogue," Li Zhaoxing said as Rice concluded talks in Asia after the North's Oct. 9 nuclear test blast.

China, North Korea's longtime protector, has been reluctant in the past to use economic pressure for fear Kim Jong Il's government might collapse.

But Chinese leaders were stung when the North ignored their warnings not to test-fire missiles over the summer, and again when it defied Beijing by detonating the underground blast this month. China previously had reduced food aid to North Korea amid complaints that Pyongyang had ignored Chinese interests.

The move by China's banks could deal a significant blow to the already impoverished North. China is North Korea's top trading partner — accounting for more than half its total foreign trade of less than $4 billion last year — and is a primary conduit for its hard currency.

China's actions are considered key to enforcing U.N. sanctions on the North over the test, and to coaxing the North to back away from the nuclear brink and rejoin talks.

Rice told reporters China has new resolve against the North that shows it has re-evaluated its relationship with Pyongyang. Last week's U.N. Security Council vote to impose sanctions on Pyongyang, which Beijing supported, proves the point, Rice said.

"In this entire 30-year history of the North Korean nuclear program, this is the first time that the international system has been able to actually impose a cost on North Korea for its nuclear behavior," Rice said. "It's able to impose that cost because China has been brought into the process in a way that China never was before."

The U.S.-backed sanctions were watered down partly at China's request, but China's vote in favor of punishment still represents a shift for Beijing.

All four major Chinese state-owned banks and British-owned HSBC Corp. have stopped financial transfers to the North, according to bank employees in Beijing and the northeastern Chinese city of Shenyang.

China sent a top envoy to Pyongyang this week to warn the North against a second nuclear test and try to bring it back to the arms talks.