Heat oven to 350°F In a large mixing bowl cream butter, vanilla and sugar until light and fluffy. Beat in eggs, one at a time.
Sift flour, baking powder, baking soda and salt together. Mix mashed bananas and milk together.
Blend dry ingredients into batter alternating with banana mixture. Stir in chopped nuts.
Pour batter into 2 greased and floured 8-inch pans.
Bake for 30 to 40 minutes or until cake tester inserted in center comes out clean.
Cool 10 minutes, then turn out on racks until thoroughly cool. serve when chilled