A new, four-year term, equity-linked deposit account is being launched by BOVI, Bank of Valletta's private banking arm.

With a 100 per cent capital guarantee if held until maturity and a 4.5 per cent guaranteed interest paid after the first year, this new product may be an ideal investment avenue for those seeking to diversify their portfolio and potentially improve their returns.

The deposit account is available in both Euro (EUR) and pound sterling (GBP). Investors will benefit from potential annual interest linked to the performance of a basket of 16 international blue-chip stocks.

In this regard, the interest on this BOVI Equity Linked Deposit Account will be linked to the stock market performance of major companies such as General Electric, Nike, BMW, Sony, Coca-Cola Company, Royal Bank of Scotland, Toyota Motor Corporation, Enel, Tesco, Microsoft and Lloyds TSB, among others.

For the first year interest is guaranteed at 4.5 per cent, payable on the amount deposited. From the second year, interest is calculated according to a formula based on the performance of the lowest performing stock within the basket since the start date.

As an example, this formula generates an interest rate of 11.2 per cent for an increase of 30 per cent in the value of the lowest performing stock and an interest rate of 1.4 per cent should such stock depreciate by 40 per cent.

In years three and four, interest will be calculated on the basis of the same formula used in year two, and it is guaranteed to be, at least, equal to the interest paid in the previous year.

The minimum deposit is £1,000 and e2,000 with multiples of 1,000 thereafter. No fees are payable for opening a BOVI Equity-Linked Deposit.

This new product is being offered for a limited period that will close on November 1. The deposit will start operating on the November 5 and will mature on November 6, 2006.

The deposit account is governed by the terms and conditions reproduced on the application form, which should be read with the additional important information included in the brochure before completing the application form.

In accordance with current tax legislation, Maltese resident investors may opt to be taxed at a 15 per cent final withholding tax on any interest received.

Investors who are not subject to tax in Malta will receive interest gross without deduction of final withholding tax. Future changes in tax law or practice may affect the interest payable on maturity.