Good morning, CFOs. Affirm’s CFO discusses why a bank charter makes sense for the buy-now-pay-later company; Kyndryl’s finance chief departs amid an accounting review; and a close look at the divergence between capital and labor in today’s economy.

Affirm is one of several fintech companies seeking a bank charter under the Trump administration. A charter would allow the buy-now-pay-later company to diversify its funding sources and rely less on its bank partners, according to Chief Financial Officer Rob O’Hare.

Affirm said last month it applied for an industrial loan company charter in Nevada. Such charters allow nonfinancial companies to enter the banking industry without certain restrictions, such as oversight by the Federal Reserve. Trump-appointed regulators have welcomed similar moves by fintech, crypto and other companies seeking to open banks or offer banking services.

The company is best known for offering installment loans through retailers at the point of sale. During the quarter ended Dec. 31, gross merchandise volume—transactions on the company’s platform, minus refunds—increased 36% from a year earlier, to $13.8 billion.

Affirm currently relies on partnerships with banks—including Celtic Bank in Utah and Lead Bank in Missouri—to originate loans and issue debit cards. Even with a charter, Affirm would continue making loans through partner banks, but would use its charter for incremental loan growth, O’Hare said.

Cheaper funding from brokered deposits could also be a boon. Affirm currently funds its business with a mix of warehouse financing, loan sales and securitization. Adding deposits to the mix would provide a fourth funding option, and help the company continue to scale, O’Hare said. “There’s nice diversification that comes from that,” he said.

📆 Earnings

• American International Group
• BP
• Coca-Cola
• CVS Health
• Dupont
• Ford Motor
• Marriott International
• Robinhood Markets
• Spotify Technology

📈 Economic Indicators

• The National Federation of Independent Business releases its Small Business Optimism Index for January.
• The Census Bureau reports retail and food services sales for December.

The estimated funding level of pension plans sponsored by S&P 1500 companies remained level in January at 110% as equities increased and discount rates were relatively the same month over month, according to consulting firm Mercer LLC. As of the end of January, the plans' estimated aggregate surplus increased by $1 billion, to $147 billion, compared with a $146 billion surplus at the end of December, Mercer said.

"With leadership changes at the Federal Reserve, continued global tensions, and uncertain tariff policies, markets have a lot to process in the new year," said Mercer partner Matt McDaniel. "As a result, plan sponsors should continue to consider de-risking options to secure the recent positive movement in pension funded status."

–Jennifer Williams

In 1985, IBM was America’s most valuable company, one of its most profitable, and among its largest employers, with a payroll of nearly 400,000. Today, Nvidia is nearly 20 times as valuable and five times as profitable as IBM was back then, adjusted for inflation. Yet it employs roughly a 10th as many people.

That simple comparison says something profound about today’s economy: Its rewards are going disproportionately toward capital instead of labor. Profits have soared since the pandemic, and the market value attached to those profits even more. The result: Capital, which includes businesses, shareholders and superstar employees, is triumphant, while the average worker ekes out marginal gains.

• Tech-Stock Recovery Fuels Dow Record
• How the Dow Got to 50000, in Charts

📰 Other headlines

• Kyndryl Shares Halved Amid CFO Departure, Accounting Review
• Eli Lilly to Buy Biotech Orna Therapeutics for Up to $2.4 Billion
• He Vowed to Revive RadioShack and Pier 1. Investors Say They Were Swindled.
• Novo Nordisk Escalates Fight Against Hims & Hers
• Red Lobster CEO Says Seafood Chain Needs to Get Smaller

This March 23–24, financial leaders will gather in Palo Alto for The WSJ CFO Council Summit to examine how CFOs are navigating market volatility, evolving trade and regulatory policy and the growing impact of AI on the future of the enterprise. Join the CFO Council and be part of the conversations shaping the future of finance and corporate leadership.

Request Invitation.

Warby Parker, the New York-based eyewear company, named Adrian Mitchell as CFO. Mitchell previously served as CFO and chief operating officer at Macy’s for three years. He succeeds Steve Miller, whose departure was announced in August.

—Katherine Hamilton contributed to today’s Ledger.

The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy.

Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew.

You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.