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, 1996        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 Section13 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 17, 1997
Common Stock ($3.33 Par Value)                      952,317 Shares


     State the aggregate market value of the voting stock held by non-affiliates
of the registrant - $17,368,199.


       Aggregrate market value       Based upon reported closing price
           of voting stock                 as supplied by NASDAQ
             $20,236,736                      March 17, 1996


                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Annual Report to Stockholders for the year ended December 31,
1996 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 28,
1997 are incorporated by reference into Part III. Exhibit index is on page 6.

<PAGE>

                              VILLAGE BANCORP, INC.
                                    FORM 10-K

                                TABLE OF CONTENTS

                                                                          PAGE
                                                                          ----
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 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...............................................3

    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


<PAGE>

                                     PART I

Item 1.    Business

"Business" on pages 4 through 9 of the Annual Report to Stockholders for the
year ended December 31, 1996 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, 1996 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 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, 1996, Village had seventy-seven (77) 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 is in the process of building a three-story, 17,000 square foot building
on Parcel 3 of the Danbury Redevelopment Area on National Place, in Danbury,
Connecticut, which it will own. Construction is expected to be completed near
the end of the second quarter of 1997. The first floor will contain a full
service branch banking office. The second and third floor will be used for
non-branch operations offices.

Item 3.    Legal Proceedings

There are no material pending legal proceedings.

                                      -2-
<PAGE>

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 1996.


                                     PART II

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

"Capital Stock" on page 35 of the Annual Report to Stockholders for the year
ended December 31, 1996 is incorporated herin by reference.

Item 6.    Selected Financial Data

"Selected Financial Data" on page 9 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 10 to 13 of the Annual Report to Stockholders for the year
ended December 31, 1996 is incorporated herein by reference.

Item 8.    Financial Statements and Supplementary Data

The consolidated financial statements and notes thereto on pages 15 to 32 of the
Annual Report to Stockholders for the year ended December 31, 1996 and the
Independent Auditors' Report on page 14 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 28, 1997,
on pages 11 through 17 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 28, 1997, on pages 18 through 23 and the information required by
this item is herein incorporated by reference.

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 28, 1997, on pages 6 through
10 and is herein incorporated by reference.

                                      -3-
<PAGE>


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 28,
1997, on pages 15 through 18 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, 1996, are
incorporated by reference in Item 8:

          Consolidated Balance Sheets - December 31, 1996 and 1995.

          Consolidated Statements of Income - Years Ended December 31, 1996,
             1995 and 1994.

          Consolidated Statements of Changes in Stockholders' Equity - Years
             Ended December 31, 1996,1995 and 1994.

          Consolidated Statements of Cash Flows - Years Ended December 31, 1996,
             1995 and 1994.

          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, 1996.

     (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.


<TABLE>
<CAPTION>
<S>                                                                   <C>
By /s/           James R. Umbarger                                      March 27, 1997
---------------------------------------------------------------------------------------------
       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, 1997
---------------------------------------------------------------------------------------------
   Edward J. Hannafin - Chairman of the Board & Director

/s/                Nicholas R. DiNapoli                                 March 27, 1997
---------------------------------------------------------------------------------------------
   Nicholas R. DiNapoli - Vice Chairman of the Board & Director

/s/                Robert V. Macklin                                    March 27, 1997
---------------------------------------------------------------------------------------------
   Robert V. Macklin - President, Chief Executive Officer & Director

/s/                Enrico J. Addessi                                    March 27, 1997
---------------------------------------------------------------------------------------------
   Enrico J. Addessi - Secretary of the Board & Director

/s/                Robert Scala                                         March 27, 1997
---------------------------------------------------------------------------------------------
   Robert Scala - Assistant Secretary of the Board & Director

/s/                Jose P. Boa                                          March 27, 1997
---------------------------------------------------------------------------------------------
   Jose P. Boa - Director

/s/                Richard O. Carey                                     March 27, 1997
---------------------------------------------------------------------------------------------
   Richard O. Carey - Director

/s/                Madeline F. Contegni                                 March 27, 1997
---------------------------------------------------------------------------------------------
   Madeline F. Contegni - Director

/s/                Jeanne M. Cook                                       March 27, 1997
---------------------------------------------------------------------------------------------
   Jeanne M. Cook - Director

/s/                Carl Lecher                                          March 27, 1997
---------------------------------------------------------------------------------------------
   Carl Lecher - Director

/s/                Joseph L. Knapp                                      March 27, 1997
---------------------------------------------------------------------------------------------
   Joseph L. Knapp - Director

/s/                Antonio M. Resendes                                  March 27, 1997
---------------------------------------------------------------------------------------------
   Antonio M. Resendes - Director

/s/                Thomas F. Reynolds                                   March 27, 1997
---------------------------------------------------------------------------------------------
   Thomas F. Reynolds - Director
</TABLE>


                                      -5-
<PAGE>

                              VILLAGE BANCORP, INC.

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT                                                                              SEQUENTIALLY
NUMBER          DESCRIPTION                          REFERENCE                       NUMBERED PAGE

<C>             <S>                                  <C>                                  <C>
3(i)            Articles of Incorporation            Exhibit 3(a) to Registration
                Statement No. 2-81879
                June 1, 1983

3(ii)           By-Laws                              Exhibit 3(b) to Registration
                Statement No. 2-81879
                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

13              Annual Report to Stockholders        Filed Herewith                        7
                for the year ended
                December 31, 1996

21              Subsidiaries of the Registrant       Filed Herewith                       43
</TABLE>

                                      -6-