The 28-year-old midfielder penned a new five-year deal in south west London on Thursday, which includes the option of a further 12 months.
Bayern remain keen on signing Palhinha after he arrived in Germany to complete a medical on deadline day a fortnight ago, only for the £60million deal to collapse after Fulham failed to sign a replacement.
Palhinha admitted it was his dream to join a Champions League club like Bayern on Fulham’s official channel.
Palhinha said: “I can’t lie, in football, we all have dreams and those are to play in the Champions League and for the best clubs in the world.
“People need to see and understand that as well but I also want to say I have all respect and I am really happy to be here as well.
“The move didn’t happen and now I am just focused on Fulham again. I will focus on my work and give everything I can like I have done in the past. If I am honest, I got this opportunity [to move to Bayern] because of my teammates, without them it might not have happened.
“I only have 100 percent commitment to this club and full respect for the fans who support me. I will give everything I have inside and outside of the field. I am ready to start again to give my best and achieve good things.”
Harrison Reed also signed a new four-year deal with the option of an added 12 months, which would keep him at Craven Cottage until 2028.