We study shear banding in a planar 4:1 contraction flow using our recently developed two-fluid model for semidilute entangled polymer solutions derived from the generalized bracket approach of nonequilibrium thermodynamics. In our model, the differential velocity between the constituents of the solution allows for coupling between the viscoelastic stress and the polymer concentration. Stress-induced migration is assumed to be the triggering mechanism of shear banding. To solve the benchmark problem, we used the OpenFOAM software package with the viscoelastic solver RheoTool v.2.0. The convection terms are discretized using the high-resolution scheme CUBISTA, and the governing equations are solved using the SIMPLEC algorithm. To enter into the shear banding regime, the uniform velocity at the inlet was gradually increased. The velocity increases after the contraction due to the mass conservation; therefore, shear banding is first observed at the downstream. While the velocity profile in the upstream channel is still parabolic, the corresponding profile changes to plug-like after the contraction. In agreement with experimental data, we found that shear banding competes with flow recirculation. Finally, the profile of the polymer concentration shows a peak in the shear banding regime, which is closer to the center of the channel for larger inlet velocities. Nevertheless, the increase in the polymer concentration in the region of flow recirculation was significantly larger for the inlet velocities studied in this work. With our two-fluid finite-volume solver, localized shear bands in industrial applications can be simulated.