The midfielder has opted to quit his homeland and link up with the Greek giants who will offer Champions League football in the coming campaign.
Munch had spent two seasons with Monchengladbach and started his career with Bundesliga titans Bayern Munich.
The 30-year-old has previously played abroad with Italian outfit Genoa and in Turkey with Besiktas.
He has signed a one-year contract with Panathinaikos and has the option of a further 12 months.
The left-sided ace will now link up with his new team-mates in Switzerland where Panathinaikos are preparing for the upcoming season.
