KUALA LUMPUR (July 21): Alliance Financial Group Bhd (AFG) is targeting an 8%–9% loan growth for the financial year ending Mar 31, 2016 (FY16).

For FY15, AFG posted a loan growth of 14.9% to RM36.6 billion, driven by expansion in consumer and business banking loan portfolio.

"We are working to change the mix of origination. The areas that you are going to see much lower loan growth are hire purchase for auto, business purpose financing and mortgages. Those are basically the elements that are going to drive the lower loans growth," AFG chief executive officer Joel Kornreich told pressmen after the group's 49th annual general meeting.

When asked if AFG's net profit would grow in tandem with its loan growth, Kornreich declined to provide specific guidance, but said the group's bottom line growth would not differ much from its loan growth.

Nevertheless, Kornreich said the group's loans to small and medium businesses would continue to see a double-digit growth.

"Last year (FY15) our SME (small and medium enterprises) loan growth was 26.8% to RM7.5 billion, this year we are hoping for another 15% growth," he said.

AFG (fundamental: 1.5; valuation: 2.25) closed unchanged today at RM4.3 for a market capitalisation of RM6.66 billion.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)