Fred Goodwin has received a "fair level of award" says RBS

The �990,000 is part of a total salary and bonus package of �1.9m for 2003, and reward for the bank unveiling a record annual pre-tax profit of �6.2bn.

Mr Goodwin also received Royal Bank of Scotland (RBS) shares worth some �1.3m at current stock market value.

The RBS said the pay was fair reward for another year of strong performance, but it was attacked by unions.

'Excellent performance'

A spokeswoman for the bank said the �1.9m figure was lower than the �2.6m Mr Goodwin received in 2002, following its successful �21bn takeover of NatWest and subsequent cost savings of �2bn.

"The directors' remuneration today reflects an absolutely fair level of award against the backdrop of another year of excellent performance," she said.

Mr Goodwin's pay is also now behind the recently-announced �3.9m pay-packet of Barclays' chief executive Matthew Barrett, whose salary has doubled.

As a reward for leading the bank to profits of �3.84bn last year, Mr Barrett will also pick up share options worth �831,000 - four times the amount he collected in 2002.

Banking critics have argued pay deals like Mr Goodwin's and Mr Barrett's are unethical, and that banks should instead give more of their record profits back to their customers through moves like increased interest rates for savers.

Demanding 'equality'

"It beggars belief that the senior management can see this bonus as acceptable when they are refusing to pay rises in line with inflation to 25,000 of the RBS staff," said a spokesman for the finance union Unifi.

"Some form of equity throughout the group has to be brought into place."

And Amicus said the fact firms were now having to disclose details of executive pay was showing "over the top" benefits being received at a time when workers were under pressure.

It said huge salaries were built on the work of staff, who were not getting equal treatment.