You don't do the whole implementation at once - you usually split it into several chunks/releases and everything becomes more manageable. I am a fan of agile where it makes sense - in projects/products where you have a strong uncertainty about the actual outcome/desired product. Then agile gets you there faster and cheaper.

But what people seem to forget about is that waterfall is actually cheaper in those cases where you have a clear understanding of the needs, the end product, and actions and tasks you need to do. This is usually the case in banking - you usually have a box product you need to customize and integrate (the toughest part, and processes are pretty much set (also strongly determined by the regulatory requirements). Hence, most innovations are just automation of specific process steps.

Another thing to consider is that the people in the bank are used to work in this way, so it removes some traction and gets you up to speed faster.