It is frustrating because this could be an interesting mechanic that would inject some much-needed dynamism into the battles and TW are just like, "Eh... what if it's overpowered... we don't want tactics to be up-ended... the balance..." There are a lot of other medieval games but banners are either abstracted or meaningless and Bannerlord might be the first were the banners actually have a role beyond looking pretty.
I think the "x% damage reduction" or "x% to morale" wouldn't be such an interesting mechanic anyways, and there would be types that would never be picked and ones that would be pretty much be the only viable choice. I see the ranged damage reduction as a must, even if they keep it as 10% I can hardly think of anything else that would be better, except for maybe survival rates.
I would rather have banners change the behavior of the group. For example, a banner that would add a bias so the AI would choose blocking attacks more often that attacking, or a bias for the troops to prioritize using polearms, a banner that would increase the aggressiveness, a banner that would prioritize a certain type of enemy when picking targets and so on.
Something like this would not only be noticeable, it would also give the player more control over the AI without forcing us to babysit too much and would expand tactical options in battle.
Alternatively, TW could buff armour protection against arrows, and then we would see banners having a noticeable impact without being too OP.
Both sides in a battle should be using banners anyway so I don't think, say, a localised 10-25% boost that both armies have access to would be too gamebreaking
It was you that posted a comparison between hits one troop could take before dying in Bannerlord and Warband, wasn't it? With the current 4-5 arrows, the percentage for an extra arrow would be around 20%, but even if tw rebalanced that to around 7-8 it would still require around 15% for the extra arrow.
I agree that tw should rebalance armors and I think your (?) suggestion of 7-8 is good, but my main problem with the way tw is going with banner bonuses is that ranged damage reduction or even any damage reduction would be a sure pick over anything else.