Banquo responds with suspicion. In Act III, scene i, lines 1-3, he says, "Thou hast it now: king, Cawdor, Glamis, all. As the weird women promised, and I fear thou play'dst most foully for't."
There is a definite rift forming between the former friends, and even Macbeth realizes it which is why he hires three murderers to kill both Banquo and his son, Fleance.
Of course, Banquo takes some comfort in the truth of the prophecy from the witches. Macbeth has been said to be king, and he is. They also, however, said that Macbeth would not have sons on the throne...that honor passes to Banquo. So, Banquo continues with, "It should not stand in thy posterity, but that myself should be the root and father of many kings" (Act III, sc i, lines 4-6).
His reaction is one of suspicion and expectation of honor for his children and grandchildren as future kings of Scotland.