The former reserves and academy coach has left Villa this summer.
"He's definitely capable of being a manager if that's what he decides to do," Bannan told the Birmingham Mail.
"A couple of years ago when he took us for a couple of games all the players loved it.
"But then he obviously never got the job. I think from then on he wanted the job because he liked the feeling of it. I think probably Championship or League One he could do really well.
"He was an all rounder, you'd know not to step out of line with Kev but there were times when you could have a bit of banter with him. Coaching wise he was second to none, he was brilliant."