Strategic Agreement etc

Banco Bilbao Vizcaya Argentaria SA
11 February 2000


Telefonica and BBVA seal a strategic agreement in the area of Internet, e-trade,
mobile phone platforms and payment systems.

- The alliance provides Telefonica and BBVA unique position to grasp the        
 enormous business oportunities in these areas, ensuring speedy execution. The  
leading position of both entities in their natural core markets, the clear     
commitment to the new technologies, the strength of their industrial groups    
and their large client basa in the same geographip areas allow for the         
accelerated development of these initiatives and ensure their success.

- In this context, BBVA will raise its holding in Telefonica to up to 10%       
 through purchases of shares in the market, and Telefonica will buy up to 3%    
in BBVA, also in the market.  It is expected that Mr Villalonga will join the  
BBVA board as a Vice-Chairman.

- The agreement contemplates initially the development of 14 joint projects     
 among which it is worth noting the 49% participation of Grupo Telefonica in    
Uno-e Bank, S.A., which will previously merge with Banco de Comercio, and the  
purchase by BBVA of 40% Telefonica B2B (e-trade amongst businesses).

Telefonical and BBVA announced today the signature of an important strategic
agreement aimed at deepening in the development of high growth businesses.

The alliance, which consists initially of 14 specific project areas, includes as
its most important elements, the increase in Telefonica's stake in internet bank
in Uno-e, from 20% to 49% and the purchase by BBVA of 40% of Telefonica B2B,
involved in e-commerce amongst businesses, providing a solid position to both
entities in these high growth areas.

Banco de Comercio will be redimensioned for the on-line market and most of the
assets will be transferred to BBVA.  BBVA will absorb the traditional banking
activites, brand, and most of the staff, offices, activities and assets of Banco
de Comercio, which will subsequently be merged with Uno-e bank, S.A.,
accelerating the increase in on-line clients.

Additionally, BBVA and Telefonica will develop joint projects in the new payment
systems business, both through fixed telephone lines and mobile lines, through
the company Mobilpago.  They will also create specific ventures for the
generation of wireless internnet applications.  BBVA will participate with up to
5% in the consortium led by Telefonica for the biddings of UMTS licenses in
Europe.

The framework of the agreement also contemplates the creation of corporations
for the joint development of e-commerce between businesses and clients (B2C) and
between clients (C2C) and the cooperaion of both groups in the development of
portals for contents and interactive services, transactional banking and payment
systems.

The alliance also contemplates the acquisition by BBVA of a 20% stake in Atento,
S.A. (up till now 100% Telefonica owned), involved in the development of the
business of 'call-centers' in Europe, and the US and Latinoamerica, which
currently counts with 60,000 client-coverage posts.  BBVA will transfer to
Atento, S.A. its 'call-centers' activity.  BBVA will participate with up to $200
million in Communicapital Partners, a Telefonica led fund, which invests in
start-up-businesses based on internet and new technologies.

Both institutions, initially agree to coordinate themselves with respect to
their holdings in Hispasat where they jointly hold 40%.

Both parties, BBVA and Telefonica, have agreed to offer Caixa the possibility to
join the alliance in the development of some of the lines of businesses, in
which the participation of such a prestigious institution as Caixa may bring a
faster development of the agreed activities.

The agreement permits both firms to cement a solid expansion in internet,
e-business, mobile services platforms and payment systems consolidating the
position of both groups in their natural markets.