(Source: Business Wire)Union Bank, N.A., today announced it will be offering its principal- and Federal Deposit Insurance Corporation (FDIC)-protected market-linked certificates of deposit (MLCD) linked to the Dow Jones-UBS Commodity IndexSM1. The product reflects the bank's expansion from MLCDs linked to the Standard & Poor's 500® Index2 to an index composed of 19 commodities. The offering will be available from Sept. 28 to Oct. 23 and will enable investors to diversify their portfolios and potentially hedge against inflation while protecting their principal when held to maturity.

"As developing countries increase their demand for raw materials, thereby pushing commodity prices higher, this product will provide a range of investors a way to participate in the potential commodity price appreciation without risking the loss of their principal if held to maturity," said Bradley Shairson, senior vice president and head of Union Bank's Global Foreign Exchange and Derivatives department. "The offering also enables investors to potentially hedge against rising inflation amid the possible decline of the U.S. dollar and to diversify their portfolios with a potential for higher returns than traditional CDs."

If held to maturity, the principal invested in the MLCD is protected from market volatility and is FDIC-insured3 up to $250,000 through 2013 when combined with bank deposits in other accounts held in the same name.

After an initial one-year holding period, redemptions of the MLCDs are allowed quarterly at market value. Investors seeking to liquidate prior to maturity may not be able to sell their MLCD. Should an investor sell the MLCD prior to maturity, he/she may receive more or less than the original investment based on market conditions. The payment at maturity may yield a return that is less than that of a traditional CD or debt instrument of a comparable maturity and it may not reflect the full upside performance of the market.

The MLCD features a survivor's option which provides beneficiaries of a client who passes away prior to maturity the option to redeem the MLCD early and receive the full amount of the initial deposit back or hold it until maturity.

Unlike traditional CDs, investors will not receive periodic interest payments and there is no assurance of gains or that any gains will match the performance of the Dow Jones UBS Commodity IndexSM or the Standard & Poor's 500® Index, depending on how a particular MLCD offering is structured.