Possible root cause #1:

• The group does not exist on the backend. Maybe someone has deleted it by mistake?
• Possible solution: create the logon group again, at the backend (transaction SMLG); or configure SAP GUI to use a different group.
• SAP Support component: BC-FES-GUI or BC-CCM-CNF-GRP.

Possible root cause #2:

• the group exists on the backend, but then there is an issue at the backend which is returning the incorrect information.
• Possible solution: BC-CCM-CNF-GRP must be involved to identify the root cause.
• SAP Support component: BC-CCM-CNF-GRP would be the appropriate component to perform the initial analysis.

Additional tests that can be performed:

• At the SAP GUI end, a trace can be captured to verify what logon group information is coming to the frontend. Check the SAP KBA 2726688- - After configuring SMLG, when creating a new connection in SAPGUI, group names are not displayed. 

• Logon to the backend and access the transaction SMLG. Confirm that the logon group exists there.