The bank doesn't eat the fraud. They charge it back to the merchant. That's why restaurants and bars don't like them, and if you fight the charge backs they raise the rates or drop you entirely.
That’s only true for online payments (and even then only if 3DS is not used).
Merchants are not liable for fraud at the POS (which includes almost all restaurants, except maybe those doing deliveries or taking down payments for reservations via the phone etc.)
