Banking industry executives see the perception of their brands’ innovation skyrocketing.

The reality of how much innovation is going on in banking: not so much.

That’s the essence of Bank Innovation‘s State of Banking Innovation study for the third quarter of 2015. Specifically, industry executives rated the overall innovation at their companies at 2.67 on a scale of 1 to 5, where 1 is “poor” and 5 is “excellent.” That innovation rating is down from 3.08 a year ago and off nearly 100 basis points from the second quarter of 2013, when it peaked at 3.45.

Those numbers compared to a soaring of level of innovation perceived for industry brands. Industry executives scored their brands a 4.65 on that scale of 1-to-5. That’s much higher than the 2.80 a year ago.

“There’s a clear disconnect between innovation practice and operations,” one respondent wrote. “Banks wants to be perceived as innovative, rather than actually innovate.”

A total of 115 people took part in the Bank Innovation study.

The true explanation for the disconnect is hard to decipher, but it seems to be rooted not just in desire, but technical challenges. As one respondent put it, there is a “very superficial layer of innovation, not based on true-customer service [or] shared objectives. Banking is unable to destroy [its] IT legacy, thus making innovation slow-moving.” The culprit, it seems, is a “lack of new ideas,” according to one respondent.

Perhaps that’s because so much budget it getting pumped into one area: mobile banking. Nearly a third of innovation budgets are going to mobile banking, the survey data showed. Significant dollars are also flowing into analytics and channel integration, but payments, P2P banking, shopping/rewards, wearables, and blockchain/bitcoin are all scratching by with little budget allocations.

Even so, there is a disconnect on budget allocation, too. A third of innovation budgets might be going to mobile banking, by 47% of respondents said mobile banking “is most valuable to consumers today.”

What is clear, however, is that “the greatest impediment to innovation at your company” remains corporate bureaucracy. In total, 44% of respondents said corporate bureaucracy was the great impediment to innovation — an identical rate to a year ago. However, budget seems to be less of a stumbling block to innovation, the data showed.

But the survey responses indicated that there might be more of a distinction between the innovation “haves” and “havenots.”

Disruption is alive and well. And we’re going through a period of increased stratification between the larger FIs with resources to dedicate to innovation and the smaller ones who are more dependent on vendor product roadmaps. Then, we’ve got disruptive fintechs who are narrowly focusing on pieces of the overall puzzle and delivering interesting results. It’s a fun time to be in bank technology, and I’m looking forward to seeing what happens.

I’m not sure I’d call that “fun.”

Learn more about fintech at Bank Innovation Israel, Nov 10-11 in Tel Aviv. Click here for details.