This is not that surprising. Young people have long viewed investment banks as a path to private equity and hedge funds. Top students at HBS can go straight to PE/HFs, so why go to a bank?
The other dynamic is that banks are increasingly promoting analysts directly to associate, without an MBA, for a variety of reasons. (MBA is kinda worthless, training direct promotes is easier than training new MBAs, if you go to b-school you probably won't go back to banking, etc.) So the most desirable analysts are either staying straight through or going to b-school with plans not to come back.