BTC itself is central bank, BTC is money!
Banks are naturally afraid of competition, which will bring new competition to financial markets and replace some of the Banks' businesses!
Less banking means less profit!
Banks are afraid of BTC because it really affects their daily transactions and considered BTC as one of their major competitors. Why? Because when people know how to invest in BTC, they don't need a bank to do the transaction. They can easily transfer and get money as it is their own bank who do transactions for them. The use of BTC also decreases the number of depositors and creditors. People do not need to deposit in a bank but rather investing their money in BTC for a higher return on investment.
That's exactly right, that's why some countries did not embrace bitcoin at their place. There is the reason why it is because it may use for illegal activities but behind of that they want to regulate bitcoin or they want to eliminate their big competitor in terms of currency holding.
Yes, it may lessen their investors and creditors because bitcoin is very profitable to invest and the best thing is you are the one who holds your money without paying tax.