The Banner Pack is found from the Frozen Chest that requires a Master Ice Pick. 3 Consumables come out; A-I, J-R & S-Z. They can be found in the Consumables tab of your inventory.
It has been speculated that they are used for decoration like in the Duke's kingdom to spell out words but there is uncertainity on how to do this or how many of letter there is or even where they end up in inventory after using them from the Consumables.