Not at the current state. People are still dependent on banks to have access to paper money, because there are few places where you can get this through Bitcoin ATMs. In addition, there are few places where you can spend Bitcoin directly.
So, what do you think more easily?
Places start to accept Bitcoin or a new altcoin made by banks?
Think about that! Bitcoin will never got this market...
An altcoin made by a bank wont be able to get as much success as bitcoin has got, because a bank would only be promote its coin into a single country because they cannot be international but every country has their own banks, but bitcoin is popular in all the world or it will be, so a coin made by a bank wont be able to compete with bitcoin.
Altcoin made by bank would be still useless since people would definitely consider bitcoin as the main crypto and each country has its own bank and if they intend to do altcoins for their country it would be still useless same as you said. They cannot compete with bitcoin for sure. Bitcoin cant make banks disappear.