1. Open up chrome and clear the browsing history from the beginning of time.
2. Type a word or a letter in the url.
3. Chrome pulls up all the visited links that are saved as bookmarks.

As it is feature request marking it as Untriaged to get more inputs from dev team.

Thanks,

Should I have opened this issue as a bug? 

I have no strong feelings on this. Should we tie it to the "[X] Use a prediction service to help complete searches and URLs typed in the address bar or the app launcher box" setting?

I reckon the question is not to me. Nice options though.

This is working as intended.

It's also documented publicly, e.g., the section on "Turn off predictions" here.
https://support.google.com/chrome/answer/95656?hl=en
Remove matches from your browsing history and bookmarks
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The address bar also shows matches from your browsing history and your bookmarks. Even if you turn off predictions, matches from your browsing history and your bookmarks will still appear in your search bar.

If you don't want to see this info in your predictions, clear your browsing history and delete your bookmarks.
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I deleted the browsing history from the beginning of time because I have saved them as bookmarks. May anyone suggest me an option so I can discuss on this further.

If you don't want the omnibox to suggest your bookmarks, I suggest you delete your bookmarks as well.

You could always use the bookmark manager to export your bookmarks to some other file first.