Can you clear the browser cache, restart browser and check if it works.
If not ensure you set the size correctly for the login section, please refer:
Please also refer note:
How to create a custom login page that displays an image logo (Doc ID 331045.1)
R12 Login Page: How to Personalize the Logo ? (Doc ID 849752.1)
Hope this helps!
Have you tried to bounce the application services (server cache) and see if this helps?
Tips For Personalizing The E-Business Suite R12 Login Page (MainLoginPG) (Doc ID 741459.1)
How to change the Corporate Branding Image System Wide in the E-business Suite (Doc ID 395663.1)
After Upgrading to Release 12 my Corporate Branding Images are Distorted. Why is This? (Doc ID 1278155.1)