Slovakia ranks below the euro area average in some of these areas, as measured by the most commonly used institutional governance indicators. More importantly, while most other new euro area countries showed some improvement over the past decade, reform momentum in Slovakia appears to have slowed after the euro was adopted (Chart 3).
As for government sponsored financial institutions fulfilling government policy objectives, if the areas of overlap with private entities are large, it may prevent private financial institutions from adjusting risk-return balances. The operations of public institutions should be based on the principle that they are complementary to the private sector.