You don’t need to manage anyone to be VP. If you manage people you deserve a director title! More than 25% of Goldman Sachs employees are VP, for example. And of course the idea of title inflation can be rendered meaningless in any situation saying “it’s just a different convention”.
It depends on the bank. In some places VPs can manage a lot of people without being promoted to Director.
You’re right. Let me change that to “if you manage a group of VPs you deserve a director title”!