UPDATE 2-Ex-TV anchor Yair Lapid named Israeli finance minister
* Upstart centrist party joins Netanyahu coalition
* Party leader, ex-TV presenter, gets finance portfolio
* Faces budget deficit reduction challenge
By Tova Cohen and Steven Scheer
TEL AVIV, March 15 (Reuters) - A former TV anchor whose upstart political party was the biggest surprise in Israel's January election was named finance minister on Friday as a coalition deal was signed, his spokesman said.
Yair Lapid's centrist Yesh Atid party, which champions bread-and-butter issues of the Israeli middle-class, won 19 of parliament's 120 seats, second after Prime Minister Benjamin Netanyahu's right-wing Likud-Beiteinu alliance's 31 seats.
After nearly six weeks of negotiations, Yesh Atid agreed on Thursday to join a Netanyahu-led government. The deal, and a separate coalition pact with the far-right Bayit Yehudi (Jewish Home) party, were signed on Friday.
Lapid, who will replace Yuval Steinitz once a new government is sworn in, ran largely on a platform of easing financial pressures on the middle class through the need to share the burden - a rejection of privileges for ultra-Orthodox Jews.
The new minister faces a major fiscal challenge in trying to reduce a budget deficit that reached 4.2 percent of gross domestic product in 2012, double an initial target of 2 percent. Continued...