SAVERS with banks in Eurozone trouble spots are being urged to withdraw their funds by a major York-based wealth management company.

Pearson Jones Plc, of Northminster Business Park, which advises more than 2,000 private clients and 500 businesses, is temporarily suspending all banks in the threatened areas of Portugal, Italy, Greece and Spain (PIGS) from its bank deposit recommendations.

Pearson Jones Plc, which also has offices in Leeds, Sheffield, Bishop Auckland and Reading, said it is changing its investment advice after the recent bail out of the Republic of Ireland increased the focus on PIGS.

The award-winning independent financial adviser has 123 staff. It was named as International IFA Team of The Year 2009/2010 in the Society of Trust and Estate Practitioners (STEP) Awards. It is recommending savers with European PIGS banks to move any fixed term deposits at maturity and any instant access accounts as soon as possible.

John Metcalf, Pearson Jones Plc York-based wealth management director, said: “Although Ireland has now agreed its bail out, the impact could be dramatic for Eurozone countries if this contagion spreads. It is estimated that, if Spain does eventually need a bail-out, it could be 750 billion euros – almost ten times the support package for Ireland.

“Our investment recommendation follows our review of the credit default swap (CDS) rates which indicate perception of default risk and have increased for PIGS banks.

“In the circumstances, our prudent approach to managing client money has led to our recommendation that savers withdraw their funds where appropriate.”

Pearson Jones Plc said if the contagion were to spread it would also affect the equity markets which have some of the risk built into their current prices.

Mr Metcalf said: “This is a risk which equity investors have to accept. However, if the contagion does not spread, the potential upside for European equities could result in good returns for investors. There are lots of strong European companies making good profits and retaining healthy sums of cash on their balance sheets.”