Result of Meeting

TELEFONICA S.A.
30 September 1999

                   CAPITAL INCREASE TO BE CHARGED TO RESERVES

At the meeting of the Board of Directors of 'Telefonica , S.A.' held on the 29th
of the present month of September, it was resolved to execute the resolution to
increase the Company's capital stock charged to freely disposable reserves that
had been adopted by the Annual General Shareholders' Meeting of March 26, 1999
through the issue and listing of 63,976,998 ordinary Company shares, of the same
series and with the same rights as those currently outstanding, each with par
value of 1.00 euro, thus increasing capital stock by the sum of 63,976,998
euros.

This capital increase shall be effected wholly subject to the conditions
established in the sixth resolution, section A), of those resolutions approved
by the General Shareholders' Meeting of March 26th, 1999 and the new shares
shall be issued in accordance with the provisions of the Securities Markets Act
24/1988 of July 28 and other pertinent regulations.

For this purpose, the procedures established in law to satisfy the prior legal
requirements for a capital increase shall be effected immediately, following
which the corresponding announcement shall he published in the Official Gazette
of the Mercantile Register, thus marking the start of the period of free
allocation of the new shares to whomsoever is a shareholder at the end of the
day on which this announcement is published, in the proportion of one new share
for every fifty old shares held.

The period of free allocation shall be fifteen days, during which time the right
of free allocation corresponding to shareholders may be exercised at any member
institution of the Securities Settlement and Clearing Service, and may also be
transferred or traded under the same conditions as the shares from which they
derive.

Lastly, the new shares shall have the right to receive the full sum of dividends
resolved to be distributed as from the date of the issue and their admission to
official listing on the markets where the Company's shares already trade shall
be requested as soon as possible.

                        Madrid, September 29th, 1999