The European Investment Bank (EIB), the European Union's long-term financing institution, announces a loan for EUR 300 million (ESP 50 billion)(1) to Retevisión for funding establishment of Spain's second fixed telephony network. The contracts relating to the second and final tranche of the loan were signed in Barcelona today by Retevisión and the fourteen financial institutions guaranteeing the operation.

Against the background of the EU's telecoms liberalisation policy, Retevisión commenced activity as Spain's second fixed telephony carrier in January 1998, ending the monopoly that had existed previously.

The loan will serve to finance investment in a switching system comprising two international gateway telephone exchanges, located in Madrid and Barcelona, eight transit and eighteen local exchanges, all interconnected by digital transmission facilities. This will enable Retevisión progressively to provide its customers with direct access to its basic telephone network, whilst offering high-tech, value-added telecommunications services such as internet links and data transmission. Retevisión's international connections will be routed via Andorra or the network of Telecom Italia, one of the company's main shareholders along with Endesa and Unión Fenosa.

This operation accords with the EIB's policy of support for telecommunications networks, in line with the EU objective of promoting the development of telecoms infrastructure of European interest (TENs).

The EIB was created in 1958 by the founding treaty of the European Economic Community, the Treaty of Rome. It was set up to contribute to the integrated and balanced development of the Member States, as well as to their economic and social cohesion, by providing long-term finance for capital investment fulfilling EU objectives. The EIB plays a major role in funding communications, including telecommunications, infrastructure, as a means of fostering European integration. Such infrastructure helps to bring the Member States closer together, enhancing the potential for economic growth in the EU's poorest and most remote regions.Owned by the EU Member States, the EIB raises the resources for its lending operations on the capital markets, where its bond issues are consistently rated AAA.

(1) EUR 1 = ESP 166.386, GBP 0.666300.