The geology of the Bay of Plenty region is a representative slice of the geological history of New Zealand. The basement rocks that form the hills and ranges are sedimentary in origin, formed during the Mesozoic era (250 - 65 million years ago). These are overlain by younger sedimentary and volcanic rocks. Volcanism in the Bay of Plenty has occurred sporadically within the Okataina Volcanic Zone over the last 7 million years, increasing in tempo through time to the present situation where the Bay now boasts spectacularly active geothermal features and New Zealand's most active volcano, White Island.
Such a dynamic geology is due to the positioning of the North Island above an active plate boundary - where the Pacific tectonic plate is being subducted beneath the Indo-Australian plate, as shown below. This process of plate subduction involves very active plate movements which not only cause the episodic volcanism, but also faulting and earthquakes.
Source: Molloy, L. 1988. "Soils in the New Zealand Landscape - The Living Mantle". With permission from NZ Society of Soil Science.
The Okataina volcanic centre has been the source of some of the most voluminous volcanic eruptions on Earth during the last 200,000 years, producing tephras (volcanic ashes) that cover most of the Bay of Plenty region forming loose sandy soils prone to landsliding. Additionally, the Bay lies adjacent to the Taupo Volcanic Zone, source of one of the largest eruptions ever known, the Oruanui eruption of 26.5ka that produced ~530km3 of magma.
Historically, the Bay of Plenty has experienced many geologic hazards including the 1886 Tarawera volcanic eruption that covered the village of Te Wairoa with up to 3 metres of mud, ash and rocks and destroyed the 'Pink and White' terraces; the 1987 Edgecumbe earthquake of magnitude 6 that caused extensive damage to the Bay of Plenty; and the recent landslides at Matata in 2004 and Tauranga in 2005.