Championship side Sunderland approached the Foxes with a transfer bid for the youngster, however Kelly and the City board feel that despite the financial aspect of any such deal benefitting the club, the development of the team is the most important ingredient for future success.
Stearman has recently been spending the majority of match days on the substitutes bench, leading to growing doubt over his future at the Walkers Stadium.
When speaking about the situation, Rob Kelly said: 'In Richard we believe we have one of the very best young players in this country.'