Financial institutions are not going to disappear, crypto or not. The are an essential, integral part of the current economic system. Retail banking is just a small part of it, financial institutions providing capitals for corporations are much more important, and crypto is of no danger for them.
The entry of Crypto currency into market trading still need the financial institution. Does the local business transaction would still requires the banking system in local trading. It wont eliminate the Banking system with the growing interest on Bitcoin investment, A lot of financial institution were looking into the Regulation issues were Bitcoin transaction would be regulated base on the mandate on Laws about trading transaction. Once this issues were address, we can see the more investor participating into the Bitcoin transaction on the trading market.