Catalog Cache Overflows can occur when the demand for concurrent Catalog Cache Memory exceeds the amount of memory available. This is most like to occur when many statements are being simultaneously prepared in high volume OLTP database environments.
Since Catalog Cache memory is drawn from DBHEAP memory, if Catalog Cache Overflows occur, then you should increase both the CATALOGCACHE_SZ and DBHEAP by 10% until overflows stop occuring.