1293413--3/28/2006--Naugatuck_Valley_Financial

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Rising interest rates may hurt our profits and asset value. If we do not achieve profitability on new branches, the new branches may negatively impact our earnings. Our increased emphasis on commercial and construction lending and the unseasoned nature of these loans may expose us to increased lending risks and could impact the level of our allowance for loan losses. A decline in our return on equity as a result of the capital we raised in our 2004 stock offering may negatively impact our stock price. Expenses from operating as a public company and from new stock-based benefit plans will continue to adversely affect our profitability. Naugatuck Valley Mutual s majority control of our common stock enables it to exercise voting control over most matters put to a vote of stockholders, including preventing sale or merger transactions you may like or a second-step conversion by Naugatuck Valley Mutual. Office of Thrift Supervision policy on remutualization transactions could prohibit the merger or an acquisition of us, which may lower our stock price. Strong competition within our market area could hurt our profits and slow growth. We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations.

Full 10-K form ▸

1293413--3/28/2006--Naugatuck_Valley_Financial_Corp