According to football.london, the Foxes will keep their star goalkeeper, with the signing of Liverpool's Danny Ward coming in to provide competition for him, rather than replacing him.
News broke on Thursday that Leicester had agreed a fee with Liverpool for Ward, who was subsequently dropped from Liverpool's friendly against Blackburn Rovers on Thursday night - which he was due to start.
Confusion surrounding the future of Schmeichel has heightened since news broke of Ward's potential move, with the Denmark stopper - who featured for his country in the World Cup this summer - heavily linked with a move to replace either Chelsea stopper Thibaut Courtois or former Roma star Alisson, who has moved to Liverpool.
Alisson's move seemed to have kickstarted a potential 'goalkeeper merry-go-round', with Ward, Schmeichel, Courtois and Petr Cech all seemingly involved.
Leicester have already lost Riyad Mahrez in this transfer window and are not willing to let another of their key players go. The Foxes have always been keen to have three first team goalkeepers on their books, having offered Ben Hamer a new contract before he decided to make the move to Huddersfield Town on a free transfer.
In the case of Cech, it seems clear that he will be staying at Arsenal this summer. His agency, Sport Invest International, denied a move was on the cards, saying: "It is only transfer rumour. Petr is full concentrating on the new season in Arsenal, we did not get any transfer offer."