Panetta was also director of the Office of Management and Budget and formerly a congressman from the western US state of California.

He is currently director of the Panetta Institute for Public Policy at California State University.

Intelligence controversies

The CIA has been rocked by scandals during the administration of George Bush, the US president.

These include allegations of intelligence failures over the September 11 attacks in 2001 and controversy over the use of waterboarding by CIA agents on al-Qaeda suspects in the Guantanamo Bay prison camp, Cuba.

Obama has also reportedly chosen Dennis Blair, a retired admiral, to be his director of national intelligence, a position currently held by Mike McConnell, the Associated Press news agency reported on Monday.

A former commander of US forces in the Pacific from 1999 to 2002, Blair will be only the third director of national intelligence - a post created in 2004 after investigations into US intelligence services condemned all agencies for failing to share information that could have prevented the September 11 attacks.