My first inclination would be to ignore them...
After that, I would fight and fight hard. Find out the university rules on displaying banners on university property... Perhaps the dean of student life might be of assistance. You might talk to the head of the music department to find out their feelings on the matter.
Don;t give up and don't be bullied. Find out the university rules and use them against the other group.
If there's something I absolutely detest, it's one group thinking they are better than another...