The nationwide rollout of the CORETAX system this year is a game-changing structural reform that strengthens public finances and reduces Indonesia's long-term reliance on debt. By establishing a modern tax infrastructure that reduces leakages and broadens the tax base, this reform justifies a strategic rotation into domestic-oriented sectors. As tax revenues are channeled more efficiently through the financial system, we anticipate a surge in sector liquidity that will drive down funding costs and support a material acceleration in credit expansion by 2H26.

This abundance of liquidity and improved purchasing power serve as the primary catalysts for the banking sector to accelerate earnings growth and drive a valuation re-rating.
 

Leading the pack, BBRI stands out as a defensive pick with an attractive 8-9% dividend yield and a clear earnings recovery cycle starting in 2026F as MSME credit costs normalize. Meanwhile, BMRI offers a deep value proposition, supported by a superior 80% CASA ratio resulting from a digital transformation that has structurally strengthened its funding franchise.

For investors seeking high-growth alternatives, BRIS offers unique "scarcity value" as the only large-cap Sharia bank, showing strong momentum in the consumer segment and its leading gold financing business. In the blue-chip space, BBCA remains the gold standard for efficiency, maintaining a cost-to-income ratio at the 30% level. With a massive liquidity buffer, BBCA is well-positioned to capture the recovery in private investment and consumption guided for 2026F without compromising its disciplined asset quality.
 

Lastly, BBNI presents one of the most compelling ROE-to-PBV anomalies among SOE banks, currently trading at a level that underestimates its mid-teens ROE potential. The bank is strategically positioned to benefit from a recovery in corporate and trade-related lending as investment activity improves. Collectively, these five banks represent the primary instruments for capturing the structural tailwinds arising from Indonesia's fiscal modernization and the broader economic recovery cycle.