The Mirror reports that City will give the 21-year-old a new long-term deal and a chance to play in the Premier League.
The England under-20 defender has impressed while on loan at Championship side Doncaster and City believe Wabara can become a regular in their first team.
City are expected to recall Wabara in January.
Wabara’s current contract with City is due to expire at the end of the season.
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The start of the 2017-18 Premier League season is just around the corner and is shaping up to be one of the most competitive yet.
As always it is the so called “big clubs” that have splashed the most cash in the transfer window so far this summer. Manchester United or City? Arsenal or Tottenham? Who are the winners and losers of the transfer window so far?