What's BKBM I hear you ask

Many agreements refer to an interest rate. It might be a rate that is used to set loan repayments, a rate used to calculate present day value, or a default rate which applies if a payment for goods is not made on time. Where the recipient of the interest wants to keep the rate floating so that it bears some relationship to their cost of money, often you'll find that the clause references a rate based on "BKBM" (short for Bank Bill Benchmark Rate). Well, if you've always wondered what that is the Reserve Bank, which sets the rate in New Zealand, has come to the rescue with this handy explanation.