True. But when dealing with multiple applicants, Reg B says you only have to notify one, preferrably the primary. And if you close the loan with the primary, you've notified them that the application was approved by closing the loan.
I have several scenarios running around in my head that may the question applicable. But I suppose the end result is that it's not hard to send an AAN, so why argue about it.
You would not have issued adverse action to the applicant who was denied. You would only have notified the one who was approved. They did not have the same outcome so how can one notice serve?
Additionally, put the regulation aside and consider common courtesy. How would you feel if you were totally ignored by a bank and received no notice whatsoever. There is reputation risk in being rude.