Re Telefonica Agreement

Banco Bilbao Vizcaya Argentaria SA
13 October 2006

BANCO BILBAO VIZCAYA ARGENTARIA, S.A. (BBVA), pursuant to the provisions of
article 82 of the Spanish Securities Market Act, proceeds by means of the
present document to notify, together with TELEFONICA, S.A. (TELEFONICA),
the following:

                              RELEVANT EVENT

In February 2000, the two companies reached a Framework Agreement for the joint
development of a number of projects related to the new technological
developments, of which the market was informed at that time.

It was then also agreed that a representative of TELEFONICA would join the
Board of Directors of BBVA, and this was executed accordingly.

Once the agreed projects have been implemented as suggested by the course of
business in each case, both companies consider that, at present, the factors
which justified the presence of a representative of TELEFONICA on the Board
of Directors of BBVA no longer apply, and the latter will therefore shortly
cease to form part of that Board.

BBVA holds a significant stake in the share capital of TELEFONICA, and has
two proprietory Directors on the Board of Directors of such company; this
situation will persist in accordance with BBVA's shareholding in TELEFONICA.
On the other hand, TELEFONICA retains its current holding in the share
capital of BBVA.

To whom it may concern for the purposes of notification to the Market.



                                                        Madrid, October 13, 2006


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