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RBS supremo Sir Fred Goodwin may have earned £3.9m last year, but the City's strict corporate governance means his earnings are dwarfed by US rivals.

Goodwin's Wall Street arch-enemy, Goldman Sachs chief Lloyd Blankfein, pocketed £27.2m (US$53.5m) over the same period. And the pay of even the lowest earner of the top 18 bank chiefs in America makes Goodwin's wages seem paltry: William Osborn, head of Chicago-based Northern Trust, earned £5.6m (US$11.1m).

It undoubtedly has something to do with size. Whereas Goodwin's Royal Bank of Scotland posted a pre-tax profit of £9.2bn for 2006, Northern Trust's full-year profits came in at £339.2m (US$665m).

But one City banking analyst says a combination of stricter corporate governance in the UK along with greater competition among Wall Street banks is the real reason behind the disparity. He says: "Corporate governance and the assertiveness of independent directors on bank boards is much better in London, so remuneration is usually not so generous. In the US, there are also a greater number of banks chasing a limited number of top-drawer executives, so the rewards, in terms of bonuses, are always greater."

Goodwin can perhaps console himself with the fact that he is the highest-paid bank chief in Scotland, ahead of Edinburgh arch-rival HBOS chief Andy Hornby, who earned £1.7m (although HBOS said on Friday it plans to increase bonuses paid to its directors this year). Meanwhile, Lynne Peacock, head of Scotland's other major bank, NAB-owned Clydesdale, was recently paid £1.1m, almost double the £600k she was paid the previous year.

But former Goldman chief executive Henry Paulson, who quit last year to become White House Treasury Secretary, made more in six months than Goodwin, Hornby and Peacock combined, after earning a £9.5m (US$18.7m) bonus for his half year at the bank.