Bank bill rate (BKBM / BBSY)

BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED 2026-11-06

// THE SHORT ANSWER

The bank bill rate is the short-term benchmark over which most floating-rate corporate and commercial loans in New Zealand and Australia are priced: BKBM, the bank bill benchmark rate, in New Zealand, and BBSY, the bank bill swap bid rate, in Australia. Each is published every business morning for terms of one to six months, and a loan resets to the rate for its chosen period, often 90 days, with the credit margin on top; smaller loans and overdrafts often use a bank's own base rate instead. UK loans have no direct equivalent: since LIBOR ended most are priced over compounded SONIA or the Bank of England base rate.

BASIS  Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.