Goldman Sachs has relaxed its dress code, allowing its bankers to swap their bespoke suits for a more casual look.

The change was signalled by the new chief executive of the US investment bank, David Solomon, a veteran banker who also DJs under the stage name D-Sol, and two other senior executives in a memo to staff.

They wrote: “We believe this is the right time to move to a firm-wide flexible dress code.” The memo cited the “changing nature of workplaces generally in favour of a more casual environment”.

However, they cautioned that staff should “exercise good judgment” and that casual dress would not be appropriate for every situation.

Goldman had already loosened its dress code for its technology staff but had maintained formal business attire for the remainder of its 36,000 employees.

It did not give further guidance to staff. The memo said: “All of us know what is and is not appropriate for the workplace.”

Goldman becomes the latest Wall Street bank to take a more casual approach after JPMorgan Chase relaxed its dress code three years ago. Its chief executive, Jamie Dimon, is often pictured without a tie.

Goldman is competing with hedge funds and large technology firms, which have more relaxed work environments, to attract the best employees. More than three-quarters of the bank’s workforce are millennials – people born after 1981.

In October, Solomon took over from Lloyd Blankfein, who had steered the bank before and after the financial crisis. The new chief executive is an investment banker and dealmaker – a change in direction for a firm that has been dominated by traders – and, in his spare time, practises yoga and plays electronic dance music as DJ D-Sol.

In his previous role as president and chief operating officer, Solomon pushed for the secretive Wall Street firm to become more open and nimble. In 2007, while he was co-head of Goldman’s investment banking division, he won the initial public offering of LuLulemon Athletica after his team wore the athleisure brand’s clothes rather than suits to the meeting. He wore a maroon blazer and sweatpants.

This week Virgin Atlantic said its female cabin crew will no longer be required to wear makeup. The airline will also provide female crew with trousers as part of their standard uniform, rather than giving them only on request.