King Albert has asked Herman Van Rompuy, a Dutch speaking Christian Democrat, to take the reigns of the Belgian government that quit December 19 after a scandal over the botched bailout of the Fortis bank.
Van Rompuy, 61, is expected to replace Leterme at the head of a quarrelsome alliance of Christian Democrats, Liberals and Socialists in a matter of days.
He is currently parliament president.
The king named him prime minister designate at the suggestion of ex-premier Wilfried Martens, who spent six days sounding out political leaders on how to quickly form a new government.
He is to discuss policy issues with leaders of the five coalition parties in the days ahead, after which the king will formally swear his government into office.
Considered a colorless but reliable leader, Van Rompuy is seen as providing a steady hand on the wheel after 18 months of squabbling among the Dutch and French speaking coalition partners under Leterme.
Finance Minister Didier Reynders, head of the Francophone Liberals, said the five coalition partners want to serve out their term until the next elections of 2011.
Disappearing with Leterme is Justice Minister Jo Vandeurzen. The two were implicated in trying to influence an appeals court to approve the sale of Fortis, once Belgium's largest bank, to France's BNP Paribas. Thousands of jobs are at risk and many Belgian shareholders have seen their stakes become nearly worthless.
Leterme and Vandeurzen deny any wrongdoing but the allegations against them led to the government's resignation.