The Premier League champion has acquired the Brazilian midfielder from Porto for 15 million euros.
Fernando had been targeted by City for his midfield anchorman qualities and will compete with the likes of Fernandinho and Yaya Toure for a starting berth.
And he has expressed his delight at finally completing his long-reported move to Etihad Stadium, saying: “I am so happy to finally be joining Manchester City. I know there was talk of me possibly signing last January so I am delighted that the deal has now been done and that I am a City player.
“I’m looking forward to meeting my new teammates and helping City to defend the title. It is a very exciting time to be part of this football club and I cannot wait to play in the Premier League. City fans can be assured I will give my all every time I play and I’m looking forward to many happy years in Manchester. I have enjoyed my stay with Porto and I thank the club and the fans for their support during my time in Portugal. Now I am ready for a new chapter in my career.”