Manage Groups tree not working

Since a recent upgrade to 4.7.10 from 4.6.11 I having unexpected behaviour on manage groups screen. I have a lot of groups with multiple parents assigned and since the upgrade the group tree is not displaying well. If I toggle actived status filter then the nested groups are appearing but without the tree structure. It happens also in the demo site. Has changed the behavior of the screen? Or it is a mistake that has appeared in some of the intermediate upgrades?

You can test it on the demo site by creating two groups and nesting them in a different parent groups. Then you only visualize one collapsable group instead of two. See the attached capture where "Case Resources" group must have a child group.