That is correct.
Let me explain how banners work.
No one understands the banner format truely except for team twiisers(marcan made a few tools that let them make the homebrew channel banner).
All the custom banners that people have made are the banners for virtual console games with the textures replaced. As a result of this, it is possible to mess up and create an improper banner, by injecting improper textures, etc.
When you install a WAD that contains a broken banner, when the Wii System Menu tries to load it....it keels over and dies. The menu assumes that all banners are legit, because as far as its concerned, they all should be. Theres no error checking, so the system menu just errors out and dies