An exception in 'finally' can overwrite exceptions from 'try' or 'catch'.
If an exception is thrown in a 'finally' block, it may mask any exceptions that occurred in the 'try' or 'catch' blocks. This can lead to lost error context, which complicates debugging. For example, if a file close operation in 'finally' throws an exception, it can suppress the original error from the 'try' block.