Bitcoin and The Blockchain are only useful when you absolutely can't trust anybody but yourself. Why would financial institutions need Bitcoin and its immense overhead when they all can use the law as a tool to ensure adequate trust? If they can trust each other at that level, all they need is a simple database.

In other words, "financial institutions" have no need for the blockchain.

Want proof? You think the NASDAQ uses anything more than a (fancy, probably very high priced, extremely robust) database to store its stuff? They deal with all kinds of people who are actively trying to fuck them over every day and every second. They have no need for the blockchain. Neither does any other "financial institution".