Backyard Banana Joe

in my limited experience I think you are fine. The neighbors cut the bloom on their bunch about a foot away from the bunch. it dried up several inches then just stopped dying. I think the drying is a natural process, as the stem is no longer a pathway (with the bud cut) to send nutrients anywhere (to the bud). I would stop cutting the stem back as the deadness it will just keep backing up towards the bananas. And, if you lose this bunch of bananas, you have a pup that will fruit several months after you plant it in the spring!