NH Nonghyup Bank said on Monday it will launch its equity-linked deposit (ELD, Equity-Linked Deposit) 26-1, which guarantees principal and a minimum contracted interest rate if held to maturity while offering the potential for higher additional returns.

The product is a one-year deposit linked to the KOSPI200 index, with returns determined by index moves. It comes in three types: Return I, II and III.

Return I applies when the index at maturity rises 0 to 20 percent from the initial level. Return II applies when the index at maturity is down 10 percent to up 10 percent from the initial level. Return III applies when the index at maturity rises 0 to 25 percent from the initial level. It offers annual returns of 1.7 to 7 percent for individuals and 1.6 to 6.7 percent for corporates.

The subscription period runs from Jan. 28 to Feb. 6, and customers can sign up at branches nationwide as well as through Smart Banking and All One Bank.

A bank official said, "In a period of falling interest rates, an equity-linked deposit will be a suitable alternative product that offers principal protection and the potential for additional returns."