Bankers are a bunch of idiots, too. I know this to be true because that one investment bank collapsed a bunch of years ago.
In all seriousness though, ETH is just a commodity; a bearer instrument; a thing. It's similar to gold or cash in some ways. If you store it properly, you're fine. If you give it to someone untrustworthy who loses it, of course that's a problem.
Well-regulated banks can start holding crypto on behalf of customers as soon as they're given the regulatory go-ahead. They've stored gold in vaults for thousands of years; they can store crypto in digital vaults too.