Result of Meeting

Telefonica SA
1 June 2000


                             SIGNIFICANT EVENT

The Board of Directors of TELEFONICA, at its meeting held on May 31st, 2000,
applying the powers bestowed upon it by the General Shareholders' Meeting,
resolved to exercise the early redemption of all the bonds convertible into
TELEFONICA shares, of a nominal value of 1,000 American dollars each, 
corresponding to the issue agreed by the Company's Board of Directors at its
meeting of June 25th, 1997, under the authorization granted by the General
Shareholders' Meeting of March 21st, 1997.

This early redemption will take place under the following terms:

a)  Object: All those bonds convertible into TELEFONICA shares, of a nominal
value of 1,000 American dollars each, will be redeemed if they have not already
been subjected to an application for conversion at least 7 days prior to the
date of early redemption.

b)  Date: The date on which early redemption will become effective will
be July 15th, 2000.

c)  Notification: The bondholders syndicate will be informed of the early 
redemption, through its Commissioner, prior to June 15th, 2000, that is, more
than thirty days previous to the effective date of the redemption.

d)  Payment: On the effective date of early redemption, the holders  of
the redeemed convertible bonds will be paid the aggregate of the following
items:

     (i) The nominal value of each holder's bonds;

    (ii) The accrued interest up to the date of redemption; and

   (iii) A redemption premium of 4.609% of the nominal value, as agreed on
         July 29th, 1997, by the Executive Committee, applying the powers       
        delegated by  the Board of Directors on June 25th, of the               
       aforementioned year, for the voluntary redemption to take place on       
      July 15th, 2000.

The Board of Directors likewise resolved to approve the early redemption of the
bonds, exchangeable for the convertible TELEFONICA bonds, issued by Telefonica
Europe, B.V., the sole holder of the Company's convertible bonds, and to cancel,
from the date of the redemption of the convertible bonds stated in the agreement
above, the irrevocable and unconditional joint covenant granted by the Board of
Directors on June 25th, 1997 for Telefonica Europe, B.V.'s exchangeable bond
issue.

Madrid, June 1st, 2000