They worry that Bitcoin is taking on the banks. Regulators are trying to play catch up with Bitcoin and other cryptocurrencies, and realising now that its not going away. In fact, it is challenging their monetary system which is intrinsically linked to banks, and especially central government-backed banks.
I think the Bank is definitely not needed when making people-to-person transactions, especially cross-border. Big Banks was very nervous about Bitcoin because BTC appeared to split third parties.