Re Investigatory Proceedings

Banco Santander Central Hispano SA
1 July 2002


                                    Statement

Following publication by news media of a judicial decree issued by Central
Magistrates Court no. 3, which concludes investigatory proceedings 53/92 related
to loan assignments, and states the case to the plaintiffs in order that they
either request the opening of a trial, dismissal of the case or separate
proceedings, the Bank

 
                                      STATES      

-   The marketing of the loan assignments was undertaken within the strictest 
    legality, as it has sustained during the more than 10 years that these 
    investigatory proceedings have inexplicably been under way

-   The State Attorney's Office, the State Tax Administration and the Public 
    Prosecutor's Office have corroborated that the Bank's repeated requests 
    since 1996 for the case to be dismissed have been correct, on the 
    understanding that no crime exists.

-   The judicial decree maintains that executives of Santander took part in 
    alleged fiscal crimes involving 138 holders of loan assignments. None of the 
    Bank executives has collaborated in committing any fiscal crime, carried out 
    ultimately by persons of whom it had no knowledge.

-   It is the case that of the 138 cases mentioned, the Public Prosecutor and 
    the State Attorney have asked for more than 100 to be dismissed on the 
    grounds that no crime whatsoever had been committed.

-   The Bank, despite having collaborated fully during the investigatory phase, 
    has been denied access to the individual cases pursued against various 
    holders of loan assignments, at the express order of the Judge, which has 
    clearly left it unable to defend itself.

-   The Bank considers that this decree is clearly contrary to the spirit of the 
    law and contradicts the most recent resolution decreed by the Penal Court on 
    this same matter, which is seriously harms the Company's interests.

-   For this reason, and as an initial step, once formal notification has been 
    received, which had not occurred when this statement was drawn up, it will 
    appeal this decree seeking its complete annulment.



                                                          Madrid, June 28, 2002
 



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