The 38-year-old has agreed a one-year extension as his previous deal was set to expire this summer.
Birmingham completed the signing of goalkeeper Ben Foster from Manchester United earlier this week.
The Birmingham boss said: “Maik has accepted a new deal. I can see him becoming a future coach.
“He is nearing the age of 40, but like David James he is in superb condition.
“I need Maik to drive Ben and he still has the hunger. I’m sure that he’ll still be in Northern Ireland’s thoughts which will keep him on his toes.”
