UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10K
              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1997              Commission File number:
                                                                 0-11786

                              VILLAGE BANCORP, INC.
             (Exact name of registrant as specified in its charter)

              CONNECTICUT                                         06-1076844
    (State or other jurisdiction of                           (I.R.S. Employer
     incorporation or organization)                          Identification No.)

  25 Prospect Street, Ridgefield, Ct.                               06877
(Address of principal executive offices)                          (Zip Code)

        Registrant's telephone number, including area code: 203 438-9551

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

       Title of each class:           Name of each exchange on which registered:
Common Stock ($3.33 Par Value)                         NASDAQ

        SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  report(s),  and (2) has  been  subject  to such  filing
requirements for the past 90 days.

                 Yes _X_    No ___

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  the  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. |_|

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

              Class                                Outstanding at March 13, 1998
Common Stock ($3.33 Par Value)                           1,918,434 Shares
------------------------------                           ----------------

State the aggregate market value of the voting stock held by non-affiliates of
the registrant - $32,922,480.

Aggregrate market value                        Based upon reported closing price
    of voting stock                                  as supplied by NASDAQ
      $38,368,680                                    March 13, 1998
      -----------                                    --------------

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Annual Report to  Stockholders  for the year ended  December 31,
1997 are  incorporated  by  reference  into parts I, II and IV.  Portions of the
Proxy  Statement for the Annual Meeting of  Stockholders to be held on April 27,
1998 are incorporated by reference into Part III. Exhibit index is on page 6.


<PAGE>


                              VILLAGE BANCORP, INC.
                                    FORM 10-K

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                        PAGE
                                                                                        ----
<S>        <C>                                                                            <C>
PART I
           Item 1.    Business ........................................................   1
           Item 2.    Properties ......................................................   2
           Item 3.    Legal Proceedings ...............................................   2
           Item 4.    Submission Of Matters to Vote of Security Holders ...............   3

PART II
           Item 5.    Market for Registrant's Common Stock and
                      Related Stockholder Matters .....................................   3
           Item 6.    Selected Financial Data .........................................   3
           Item 7.    Management's Discussion and Analysis of Financial
                      Condition and Results of Operations .............................   3

           Item 7.a.  Quantitative and Qualitative Disclosure About Market Risk .......   3
           Item 8.    Financial Statements and Supplementary Data .....................   3
           Item 9.    Changes in and Disagreements with Accountants on
                      Accounting and Financial Disclosure .............................   3

PART III

           Item 10.   Directors and Executive Officers of the Registrant ..............   3

           Item 11.   Executive Compensation ..........................................   3
           Item 12.   Security Ownership of Certain Beneficial Owners
                      and Management ..................................................   4

           Item 13.   Certain Relationships and Related Transactions ..................   4

PART IV

           Item 14.   Exhibits, Financial Statement Schedules and
                      Reports on Form 8-K .............................................   4

SIGNATURES ............................................................................   5

EXHIBIT INDEX .........................................................................   6
</TABLE>


<PAGE>


                                     PART I

Item 1. Business

"Business"  on pages 4 through 10 of the Annual Report to  Stockholders  for the
year ended December 31, 1997 is incorporated herein by reference.

Additional information required pursuant to this Item follows:

Village Bancorp, Inc.

The  management of The Village Bank & Trust  Company  (Village)  caused  Village
Bancorp,  Inc.  (Company)  to be formed in 1983 to enhance the  opportunity  for
diversification  and  expansion,  and to allow for greater  flexibility  in both
banking and non-banking  functions which banks are prohibited from entering.  On
July 19, 1983,  the Bank became a wholly  owned  subsidiary  of the Company.  On
November 18, 1994, Liberty National Bank (Liberty),  Danbury, Connecticut became
a wholly owned  subsidiary of the Company.  On June 20, 1995, the Company merged
Liberty into Village and now operates Liberty's former office as a branch office
of Village.  As a combination  of entities  under common  control the merger was
accounted  for in a manner  similiar  to a pooling of  interests.  As such,  all
historical  financial  data  presented in the annual report has been restated to
include  both  entities for all periods  presented.  As of December 31, 1997 the
Company's only subsidiary was Village.

The Village Bank & Trust Company

The  Village  Bank &  Trust  Company  was  incorporated  in 1973  and  commenced
operations  in  1974.  The  Bank  maintains  its   headquarters  in  Ridgefield,
Connecticut  where it conducts  general  banking  business as a state  chartered
commercial  bank as allowed by Sec. 36-57 of the Connecticut  General  Statutes.
The Bank began  offering  trust and  similiar  services in the third  quarter of
1993. Liberty was merged into Village in June 1995, with its former office now a
Village branch. The Bank intends to offer services in the future that will allow
the Bank to remain competitive with other financial  institutions as regulations
permit.

Patents, Trademarks, Licenses and Concessions Held

There are no  patents,  trademarks,  licenses  or  concessions  held that have a
material importance to the Company.

Seasonal Variations In Business

The Bank experiences little or no seasonal variation in it's business due to the
retail composition of it's customer base.

Dependence Upon Limited Number Of Customers

The Bank is not materially  dependent on any single person,  group of persons or
organization.  The loss of any customer or group of related  customers would not
have a materially adverse effect on the continued operation of the Bank.

Competition

The Bank  encounters  substantial  competition for deposits and loans from other
financial  institutions.  Vigorous competition exists between the Bank and other
branch  offices of  financial  institutions  in Danbury,  New  Milford,  Wilton,
Westport and Ridgefield,  including  commercial banks, savings banks and savings
and  loan  associations.  No  one  financial  institution  is  dominant  in  any
particular function of the banking market place.

Number of Employees

At December  31,  1997,  Village  had  seventy-seven  (97) full time  equivalent
employees.  Of these employees two officers of Village  provide  services to the
Company.

Supervision and Regulation

Village is insured by the Federal Deposit  Insurance  Corporation  (FDIC) and is
subject to extensive  regulation by the FDIC.  Village,  as a Connecticut  state
chartered bank, is also subject to regulation by the  Connecticut  State Banking
Commissioner,  who is responsible for  administering  Connecticut  banking laws.
(Bancorp,  as a bank  holding  company,  is also  subject to  regulation  by the
Federal  Reserve  Board.



                                      -1-
<PAGE>


The  FDIC has  adopted  regulations  which  require  FDIC-insured  banks to meet
certain  minimum  capital  requirements.  Banks that have less than the  minimum
required  capital  are  considered  to be  operating  in an unsafe  and  unsound
condition,  and are  subject  to a number  of  possible  regulatory  enforcement
actions,  ranging  from  being  required  to  acquire  additional  capital up to
termination of the Bank's FDIC deposit insurance.

Until recently most  legislation had been aimed at increasing  capital levels in
the  banking  industry  and  restricting  business  for  those  who fail to meet
adequate capital levels. As the Company is well capitalized the majority of this
legislation has had little effect on the operation or financial condition of the
Company.  Legislation and proposed legislation most recently has been addressing
the area of risk, specifically interest rate risk. Essentially it is looking for
the banking industry to have a comprehensive  risk management  process in place,
that effectively identifies,  measures, monitors and controls interest rate risk
exposures.  Other regulatory actions focus on risk management (i.e. credit risk)
and the proper use of internal controls.  Proposed legislation runs a wide gamut
of proposals. It is not possible at this time to predict whether or not any such
proposals will have any adverse effect on the Company,  although management does
not  expect  any  material  adverse  effect on the  financial  condition  of the
Company.

Item 2. Properties

Village  owns in fee simple a self  contained  facility  at 25  Prospect  Steet,
Ridgefield,  Connecticut.  The site contains  0.929 acres.  The building has two
floors,  the first floor which approximates 5,500 square feet is the location of
the general banking area, board room and President's  office.  The second floor,
which  approximates  5,000  square feet,  is the location of the  administrative
offices, loan operations department, sanitary and employee facilities.

Village  entered into a lease  agreement  on April 5, 1985 for a branch  banking
facility at 219 Town Green,  Wilton,  Connecticut.  The  leasehold  contains two
thousand six hundred forty five (2,645) square feet,  that the Bank uses for its
branch banking office. The lease arrangement is for ten years with two five year
extensions  options that can be exercised by the Bank.  The lease has provisions
for consumer  price index  increases,  and the current  annual rental expense is
$75,343 not including  property tax and maintenance  charges.  This facility was
opened November 16, 1985 and is a full service branch banking office.

Village  extended  a  lease  agreement  on  March  31,  1993,  for a  non-branch
operations  (back-office) facility at 96 Danbury Road, Ridgefield,  Connecticut.
The leasehold contains  approximately six thousand (6,000) square feet of office
space and one thousand  (1,000) square feet of storage space. The original lease
arrangement was for five years with provisions for two five year extensions,  at
an annual  rental of  approximately  $90,870,  not  including  property  tax and
maintenance charges.  This lease originally commenced November,  1988, with five
percent annual  increases.  Four  stockholders,  two of whom are Directors,  are
affiliated with the partnership which is leasing the facility to the Bank.

Village owns in fee simple a self contained  facility at 54 Bridge  Street,  New
Milford, Connecticut. The site contains 0.16 acres. The building has two floors.
The first floor,  which  approximates  1,700 square feet, is the location of the
general banking office.  The second floor, which approximates 1,524 square feet,
will be used for offices and loan originations and closings.

Village has a lease  agreement for a branch banking  facility at 28 Shelter Rock
Road, Danbury, Connecticut, that extends through October 31, 2001. The leasehold
contains  approximately two thousand four hundred sixty (2,460) square feet. The
annual rental is approximately  $39,360,  not including property and maintenance
charges.

Village  entered  into a lease  agreement  in May,  1997  for a  branch  banking
facility at 244 Post Road East,  Westport,  Connecticut.  The leasehold contains
eight thousand seventy-nine (8,079) square feet, of which approximately 6,000 is
used by the Bank for its branch  banking  office.  Currently  approximately  one
thousand  six hundred  (1,600)  square feet of this space is being  sublet.  The
lease  arrangement is for ten years with one five year extension option that can
be exercised by the Bank.  The current  annual  rental  amount is $270,000,  not
including tax and maintenance charges.

Village  completed the building a three-story,  17,000 square foot building at 2
National  Place,  Danbury,  Connecticut,  in July of 1997,  which it owns in fee
simple.  The first floor  contains a full service  branch  banking  office.  The
second and third  floors are being  utilized  for loan and  deposit  back-office
operations.



                                      -2-
<PAGE>


Item 3. Legal Proceedings

There are no material pending legal proceedings.

Item 4. Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of the Company's security holders during the
fourth quarter of 1997.

                                    PART II

Item 5. Market for Registrant's Common Stock and Related Stockholder Matters

"Capital  Stock" on page 36 of the Annual  Report to  Stockholders  for the year
ended December 31, 1997 is incorporated herin by reference.

Item 6. Selected Financial Data

"Selected  Financial Data" on page 10 of the Annual Report to  Stockholders  for
the year ended December 31, 1996 is incorporated herein by reference.

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" on pages 11 to 14 of the Annual Report to Stockholders  for the year
ended December 31, 1997 is incorporated herein by reference.

Item 7.a. Quantitative and Qualitative Disclosure About Market Risk

"Market Risk" and  "Interest  Rate  Sensitivity"  on pages 8 to 10 of the Annual
Report to  Stockholders  for the year ended  December  31, 1997 is  incorporated
herein by reference.

Item 8. Financial Statements and Supplementary Data

The consolidated financial statements and notes thereto on pages 16 to 33 of the
Annual  Report to  Stockholders  for the year ended  December  31,  1997 and the
Independent Auditors' Report on page 15 are incorporated herein by reference.

Item  9.  Changes  in and  Disagreements  With  Accountants  on  Accounting  and
Financial Disclosure

None.

                                    PART III

Item 10. Directors and Executive Officers of the Registrant

Information  relating to directors and executive  officers of the Registrant and
Bank and the  information  required  by this  item  are  included  in the  proxy
statement for the annual meeting of  stockholders  to be held on April 27, 1998,
on pages 9  through  15 and the  information  required  by this  item is  herein
incorporated by reference.

Item 11. Executive Compensation

Compensation of directors and officers and the information required by this item
are included in the proxy statement for the annual meeting of stockholders to be
held on April 27, 1998, on pages 16 through 22 and the  information  required by
this item is herein incorporated by reference.



                                      -3-
<PAGE>


Item 12. Security Ownership of Certain Beneficial Owners and Management

Information  relating to security  ownership  of certain  beneficial  owners and
management  as required by this item is included in the proxy  statement for the
annual meeting of  stockholders to be held on April 27, 1998, on pages 4 through
8 and is herein incorporated by reference.

Item 13. Certain Relationships and Related Transactions

Information of certain relationships and related transactions is included in the
proxy  statement for the annual meeting of  stockholders to be held on April 27,
1998, on pages 13 through 16 and is herein incorporated by reference.

                                     PART IV

Item 14. Exhibits, Financial Statements

     (a) (1) The following consolidated financial statements and the Independent
Auditors'  Report  included  in the  Annual  Report to  Stockholders  of Village
Bancorp,  Inc.  and  Subsidiaries  for the year ended  December  31,  1997,  are
incorporated by reference in Item 8:

          Consolidated Balance Sheets - December 31, 1997 and 1996.

          Consolidated  Statements  of Income - Years Ended  December  31, 1997,
          1996 and 1995.

          Consolidated  Statements  of Changes in  Stockholders'  Equity - Years
          Ended December 31, 1997,1996 and 1995.

          Consolidated Statements of Cash Flows - Years Ended December 31, 1997,
          1996 and 1995.

          Notes to Consolidated Financial Statements.

     (a)(2)  Schedules  to the  Consolidated  Financial  Statements  required by
Article 9 of Regulation S-X are not required under the related  instructions  or
the information is included in the  Consolidated  Financial  Statements or Notes
thereto and has therefore been ommitted.

     (a)(3) Exhibits.

     The exhibits which are filed with this Form 10-K or which are  incorporated
herein by reference are set forth in the Exhibit Index on Page 6.

     (b) There  were no  reports  on Form 8-K filed for the three  months  ended
December 31, 1997.

     (c) Exhibits.

     The exhibits which are filed with this Form 10-K or which are  incorporated
herein by reference are set forth in the Exhibit Index on Page 6.

     (d) Financial Statement Schedules - None.



                                      -4-
<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, therunto duly authorized.

Village Bancorp, Inc.
By  /s/ James R. Umbarger                                         March 27, 1998
--------------------------------------------------------------------------------
    James R. Umbarger - Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the date indicated.
                                                                      DATE
                                                                      ----

/s/ Edward J. Hannafin                                            March 27, 1998
--------------------------------------------------------------------------------
Edward J. Hannafin - Chairman of the Board & Director

/s/ Nicholas R. DiNapoli                                          March 27, 1998
--------------------------------------------------------------------------------
Nicholas R. DiNapoli - Vice Chairman of the Board & Director

/s/ Robert V. Macklin                                             March 27, 1998
--------------------------------------------------------------------------------
Robert V. Macklin - President, Chief Executive Officer & Director

/s/ Enrico J. Addessi                                             March 27, 1998
--------------------------------------------------------------------------------
Enrico J. Addessi - Secretary of the Board & Director

/s/ Robert Scala                                                  March 27, 1998
--------------------------------------------------------------------------------
Robert Scala - Assistant Secretary of the Board & Director

/s/ Jose P. Boa                                                   March 27, 1998
--------------------------------------------------------------------------------
Jose P. Boa - Director

/s/ Richard 0. Carey                                              March 27, 1998
--------------------------------------------------------------------------------
Richard 0. Carey - Director

/s/ Madeline F. Contegni                                          March 27, 1998
--------------------------------------------------------------------------------
Madeline F. Contegni - Director

/s/ Jeanne M. Cook                                                March 27, 1998
--------------------------------------------------------------------------------
Jeanne M. Cook - Director

/s/ Carl Lecher                                                   March 27, 1998
--------------------------------------------------------------------------------
Carl Lecher - Director

/s/ Joseph L. Knapp                                               March 27, 1998
--------------------------------------------------------------------------------
Joseph L. Knapp - Director

/s/ Antonio M. Resendes                                           March 27, 1998
--------------------------------------------------------------------------------
Antonio M. Resendes - Director

/s/ Thomas F. Reynolds                                            March 27, 1998
--------------------------------------------------------------------------------
Thomas F. Reynolds - Director

/s/ James R. Umbarger                                             March 27, 1998
--------------------------------------------------------------------------------
James R. Umbarger - Executive Vice President & Director


                                       -5-


<PAGE>


                              VILLAGE BANCORP, INC.

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT                                                                                SEQUENTIALLY
NUMBER               DESCRIPTION                       REFERENCE                       NUMBERED PAGE
<S>           <C>                                <C>                                         <C>
 3(i)         Articles of Incorporation          Exhibit 3(a) to Registration
                                                 Statement No. 2-8 1879
                                                 June 1,1983
 3(ii)        By-Laws                            Exhibit 3(b) to Registration
                                                 Statement No. 2-8 1879
                                                 June 1, 1983
 4            Specimen Common                    Exhibit 4 to Form 10-K
              Stock Certificate                  December 31, 1986
 10(a)        Lease Dated April 18, 1985         Exhibit 10(a) to Form 10-K
                                                 December 31, 1986
 10(b)        Lease Dated March 31, 1988         Exhibit 10(b) to Form 10-K
                                                 December 31, 1988
 10(c)        Lease Dated April 28, 1997         Exhibit 10(c) to Form 10-K
                                                 December 31, 1997                           7
 13           Annual Report to Stockholders      Filed Herewith                              44
              for the year ended
              December 31, 1997

 21           Subsidiaries of the Registrant     Filed Herewith                              80
</TABLE>


                                       -6-