TNS-12531: TNS:cannot allocate memory

Symptoms
On windows platform, new client connections to the database through listener fails, "TNS-12531: TNS:cannot allocate memory" error found in listener.log.

Cause
The issue here seems to be that we are running out of Desktop Heap memory. This problem may happen if you are running lot of windows services which consume same default desktop heap.
Solution
http://support.microsoft.com/default.aspx?scid=kb;EN-US;126962

When you run a large number of Windows-based programs, "Out Of Memory" error messages appear when you attempt to start new programs or try to use programs that are already running, even though you still have plenty of physical and pagefile memory available.
To correct this problem, increase the size of the desktop heap:

1. Run Registry Editor (Regedt32.exe).
2. From the HKEY_LOCAL_MACHINE subtree, go to the following key: \System\CurrentControlSet\Control\Session Manager\SubSystems
3. Select the Windows value.
4. From the Edit menu, choose String.
5. Increase the SharedSection parameter.
   
   For Windows NT:
   SharedSection specifies the system and desktop heaps using the following format:
   SharedSection=xxxx,yyyy
   Add ",256" or ",512" after the yyyy number.
   
   For Windows 2000, Windows XP, and Windows Server 2003:
   SharedSection uses the following format to specify the system and desktop heaps:
   SharedSection=xxxx,yyyy,zzzz
   For 32-bit operating systems, increase the yyyy value to "12288";
   Increase the zzzz value to "1024".
   For 64-bit operating systems, increase the yyyy value to "20480";
   Increase the zzzz value to "1024".

Ref: 308386.1