Are you required to give a initial privacy notice to those people who you do not open an account for due to a record from chexsystems and/or decline an loan application? Some of us say yes and some say no.

The regualtion only requires that you give the initial notice to your customers, when you establish a customer relationship, if you never establish any relationship no notice would be required.

The above response is true, but don't forget the US Patriot Act Notice that must be posted at new accounts:

U.S. PATRIOT Act Notice
To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license or other identifying documents.

Under the privacy regulations, someone whose application is denied is a "consumer" but not a "customer". Customers must always get privacy notices, consumers only get them IF you share information about them with nonaffiliated thrid parties outside of the exceptions.